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June 2008 Archives
The growing pains of the wind industry have been covered here in detail on this blog a few times, most recently here. But some firms appear to be less able to deal with it than others and Suzlon, following a report in today's Wall Street Journal, appears to be exhibit A.
Specifically, there seem to be two problems with their export models to America;
The second reminds us that there is a whole world of technical connection issues with wind power that can't be glossed over. The power supply in India meanwhile is said to be so unreliable, wind turbines are obtained by factories as backup power. All this matters because as the article says; Three years ago, 90% of Suzlon's sales were in India; today, international sales account for 60% of the total. Suzlon's presentations to investors predict exports will jump to 75% of total sales next year, with the U.S., China and Europe accounting for an equal share. Since it began its push into the U.S. in 2005, Suzlon has secured an 8% share of the U.S. wind market, the world's fastest growing. For all that, these problems are not insurmountable but the damage to Suzlon's reputation is serious. Whilst we'd all like to see windpower costs going down, that doesn't look too likely in the next few years. I question then if the industry has missed a trick by not building turbines that can genuinely last say, 35 years? That just might deliver the kind of cost breakthrough in wind - cheaper than coal - that google.org has been fantasising about.
Top 5 Gainers
Questair Tech LSE:QAR Hydrogen 740.00%
Andersons (The) (MM) NASDAQ:ANDE Bioethanol 26.39%
Ceres Power LSE:CWR FuelCells 19.79%
Quantum Fuel Systems Technologies Worldwide (MM) NASDAQ:QTWW FuelCells 16.73% Beacon Power (MM) NASDAQ:BCON EnergyStorage 14.36%
Top 5 Losers Tanfield LSE:TAN ElectricVehicles -43.14%
Sunopta (MM) NASDAQ:STKL Bioethanol -20.22%
Active Power (MM) NASDAQ:ACPW EnergyStorage -15.79%
Nova Biosource Fuels, AMEX:NBF Biodiesel -13.51% D1 Oils LSE:DOO Biodiesel -10.81%
THE GAINERS
Andersons (The) (MM) NASDAQ:ANDE Bioethanol 26.39% Ceres Power LSE:CWR FuelCells 19.79% Quantum Fuel Systems Technologies Worldwide (MM) NASDAQ:QTWW FuelCells 16.73% Beacon Power (MM) NASDAQ:BCON EnergyStorage 14.36% Hydrogenics Corp Com Npv TSE:HYG FuelCells 13.85% Verasun Energy Corp NYSE:VSE Bioethanol 11.39% Aventine Renewable Energy Holdings NYSE:AVR Bioethanol 10.72% Run of River Power Inc. (Tier1) TSX:ROR DiversifiedAltE 8.33% Medis Technologies Ltd. (MM) NASDAQ:MDTL FuelCells 8.06%
Continue reading Global Alt. E. Stock Report - 26 to 27 June 2008.
Most of the time, this blog focuses on big listed companies. And yet, whilst they tend to be the most relevant to alternative energy investors, in so doing we are missing out on something crucial; innovative small companies that just might one day deliver the game-changing invention that will BE BIG. It may be a cliche, but my admittedly partial anecodatal evidence is that when alt. e. companies become large blue chips, the corporate culture takes over and the innovation goes out of the window. The question is why?
Arguably, because they have a much greater fear of failure. Silly really, when if you've read Why most things fail: evolution, extinction and economics by Paul Ormerod, you understand that failure is the natural order not only of the economy but of the biosphere. You have to budget for failure to succeed. Roughly 99.8% of all species and companies that have ever existed do not do so today. But that's ok because we have superfecundity - as Eric Beinhocker argued in a similarly excellent book, The Origin of Wealth: Evolution, Complexity and the Radical Remaking of Economics, i.e. a surplus of players in the biosphere and the marketplace who are destined to fail but in so doing provide competition, and a learning mechanism for the survivors. So after that rather long introduction, I'd like to introduce you to three players who have emerged into the light over the last few weeks, who have very novel innovations to their name. First of all, Broadstar Wind Systems who have developed a turbine that looks like it fell off the back of a paddle steamer called the Aerocam.  This is potentially exciting not only for the aesthetics (!), or even for the lower avian mortality rates, but more seriously because Broadstar believe they can deliver this technology at an overnight capital installation cost of $1 per watt - roughly where it was a few years ago before the ramp up in steel prices, construction costs and various supply constraints kicked in. I've tried squinting at the power curve (can't they and everyone else just give us the underlying numbers so we can overlay them with others on the same chart?) on this machine compared to a conventional horizontal axis turbine with inconclusive results - you may do better. It has the added advantage of requiring shorter towers and a possibility to infill on existing wind farm sites. All that' s quite exciting, novel and still has a high risk of failure because as far as I can see, there is as yet, no working example, displayed on their website. Here's another wind turbine which is vertical axis - quiet revolution - and beautiful to behold.  On the face of it, it looks pretty expensive but that's not a reason for it not to succeed, just look at Ferrari. If you fancy a trip to a less desirable corner of London some time - Elephant and Castle - you can see one of these perched on top of a block of flats at the opposite end to a conventional Proven wind turbine and draw your own conclusions on the horizontal axis versus vertical axis wind turbine debate.Finally, Raw Solar. Students at the Masachusetts Institute of Technology have come up with this;  basically a concentrated solar thermal device, which creates steam for say, a food processing plant or district heating. Nothing immediately radical there except, in Raw Solar's own words; RawSolar's patented design flexes flat mirror into precisely the right shape without any special tooling or skilled labor, acheiving incredibly high performance, long lifetime, and at a very low cost. Which in principle sounds great, although I worry a bit about companies that keep talking about low cost without giving us any prices to indicate the true cost of their product at all. Perhaps I'm unkind and this is something they can only divulge to their investors, or they're not really sure of the numbers until they know how big the investment can be. Fair enough. So, the long and short of this is, keep an eye on the little tiddlers - everyone has to start somewhere.
Top 5 Gainers
Nova Biosource Fuels, AMEX:NBF Biodiesel 19.35% Plug Power (MM) NASDAQ:PLUG FuelCells 15.09%
Hydrogenics Corp Com Npv TSE:HYG FuelCells 10.17%
Dynetek Industries Com Npv TSE:DNK EnergyStorage 6.94%
Quantum Fuel Systems Technologies Worldwide (MM) NASDAQ:QTWW FuelCells 6.81% Top 5 Losers Active Power (MM) NASDAQ:ACPW EnergyStorage -28.30%
Mechanical Technology Incorporated (MM) NASDAQ:MKTY FuelCells -18.46%
Tanfield LSE:TAN ElectricVehicles -18.40%
China Sunergy CO., Ltd. ADS (MM) NASDAQ:CSUN Solar -16.36%
Trina Solar Ltd Adr NYSE:TSL Solar -11.60%
Top 5 Gainers
Daystar Technologies (MM) NASDAQ:DSTI Solar 9.11%
Futuref Regs LSE:FFU Biodiesel 9.09% Energy Dev Fpo ASX:ENE Wastegas 8.75%
Medis Technologies Ltd. (MM) NASDAQ:MDTL FuelCells 7.72%
Biopetrol Inds Inh.SF 1 XE:B2I Biodiesel 7.25%
Top 5 Losers Applied Intel. LSE:AINC EnergyStorage -13.52%
Hydrogenics Corp Com Npv TSE:HYG FuelCells -13.24%
Missionbio Fpo ASX:MBT Biodiesel -12.73%
Opel International (Tier2) TSX:OPL Solar -12.22%
Austrefuel Fpo ASX:ARW Biodiesel -11.11%
I meant to flag up this article in the FT a while ago when it first appeared in the orange newspaper. It's well worth a read. A few choice points the article - or people quoted in it - mentions;
1) Grid parity will be reached first in Italy by 2011 or 2012 - (for that I'm afraid Italy can thank it's own bureaucratic incompetence in failing to license the building of adequate power supplies!) 2) Germany has 55% of the global solar market, Japan 17% and the USA, just 5% (which makes you think of the growth potential of the United States) 3) the current price of $3.80 per watt of solar capacity equates to a power price of about $0.245 per kilowatt hour - about double the European average wholesale electricity price (which I would suggest will probably go up a bit faster than solar will come down) I keep thinking though about Texas and how wind power there has actually started to become a deflationary force, lowering the price of electricity to consumers, as it has become cheaper to produce than gas-fired electricity since 2006. Better than wind parity in other words with gas, or as www.google.org would put it RE<G. As this article in Renewable Energy World makes clear; Bringing new wind energy online is critical to protecting Texas consumers from increases in the price of fossil fuels, wind energy advocates point out. Texas currently depends on natural gas to generate 49% of its electricity, and natural gas plants make up 71% of the state's generating capacity. From 1998 to 2006 natural gas prices in the state tripled, which caused the price of electricity for the average residential consumer to increase from US 7.6 cents per kWh to US 12.9 cents per kWh.
Top 5 Gainers
Envitec Biogas O.N. XE:ETG Biogas 10.79%
Hydrogenics Corp Com Npv TSE:HYG FuelCells 10.57%
Medis Technologies Ltd. (MM) NASDAQ:MDTL FuelCells 9.56%
Ldk Solar CO Adr NYSE:LDK Solar 8.42%
Schmack Biogas NA O.N. XE:SB1 Biogas 5.48%
Top 5 Losers Quant Ene Fpo ASX:QTM HeatPumps -16.67%
Opel International (Tier2) TSX:OPL Solar -11.76%
Ceres Power LSE:CWR FuelCells -11.10%
Pacific Ethanol - Commonstock (MM) NASDAQ:PEIX Bioethanol -10.19%
Xethanol Corp. AMEX:XNL Bioethanol -10.00%
Today's news that Envitec Biogas - a producer, planner, constructor and commissioner of turnkey biogas plants - has just closed a deal worth EUR 60 million tells us a few things;
i) The continuing effectiveness of generous subsidies in Germany in attracting investment - recently revised to further promote Biogas ii) Recent rises in natural gas prices across the world, with probably more to come are pricing Biogas into the mainstream iii) On energy security issues, for the import of gas, Germany has no real choice other than Russia - talks of creating LNG terminals to tap into other suppliers have remained just that - that means the only real option is the exploitation of domestic gas supplies from biosources The company is way off its highs since a year ago and in the face of this news, you wonder how long that will last. Meanwhile, the other day I was interviewed on Al-Jazeera TV again and argued that OPEC was increasingly irrelevant and its importance long-overrated to the oil price. It was never as if they all sat down at a table and planned for $140 a barrel. As if they could ever all agree and flawlessly coordinate and trust each other ! The leading player in this game was the emerging market consumer, led by the Chinese middle class. China, I added, still plans to have 100 million more vehicles on its roads by 2020.
Top 5 Gainers
Hydrogenics Corp Com Npv TSE:HYG FuelCells 12.74%
Active Power (MM) NASDAQ:ACPW EnergyStorage 11.56%
Chongqing Three GO 'a'cny1 SHX:600116 Hydro 10.05%
Sichuan Minjiang H 'a'cny1 SHX:600131 Hydro 9.98% Altair Nanotechnologies Inc. (MM) NASDAQ:ALTI EnergyStorage 9.82%
Top 5 Losers Medis Technologies Ltd. (MM) NASDAQ:MDTL FuelCells -26.09%
Verasun Energy Corp NYSE:VSE Bioethanol -13.43%
Wind Hydgn Fpo ASX:WHN DiversifiedAltE -9.38% Itm Power LSE:ITM FuelCells -8.33%
Sustainable Energy Technologies Ltd. (Tier2) TSX:STG DiversifiedAltE -8.16%
Three years ago, Japan, a powerful, wealthy island nation who at the time had the highest retail electricity prices in the world, pulled th plug on its pioneering - albeit expensive - solar subsidies. With hindsight, you could easily say that the timing of this decision was awful, coming as it did just as the cost of conventional energy started to escalate and the solar industry took off. You might even say that this effectively handed leadership of the world's solar industry to Germany. As Japanese demand dropped off, solar sales declined, curtailing investment in capacity expansion and long-term silicon procurement which meanwhile happened everywhere else.
And yet, retrospectively, it wasn't actually that bad a decision - 3 years of no subsidies has saved them some money. For now, the solar industry continues to be much more national than global so they probably have not lost that many exports. Moreover, they still have quite a few solar companies growing fast within the industry at the upstream equipment supplier and solar module manufacturing level. One last point on Japan's solar industry - few realize that on some metrics, Japan had actually already reached grid parity with solar power in 2005, it's just that no one got that excited about it ! So my interest was piqued to learn today from Reuters that Japan, spurred on by its famously interventionist Ministry of Economy, Trade and Industry - METI - is poised to provide subsidies and tax breaks for solar panel makers from 2009. Other than successful lobbying by the Keiretsu, the principle reason for this appears to be a target which aims to have more than 70% of new homes equipped with solar panels by 2020. And with annual housing starts running in Japan at just under 750,000 per year, that's a lot of solar power that will need to be bought.
Top 5 Gainers Plug Power (MM) NASDAQ:PLUG FuelCells 12.05%
Sichuan Minjiang H 'a'cny1 SHX:600131 Hydro 10.07% Chongqing Three GO 'a'cny1 SHX:600116 Hydro 9.94%
Verasun Energy Corp NYSE:VSE Bioethanol 9.91%
Quantum Fuel Systems Technologies Worldwide (MM) NASDAQ:QTWW FuelCells 7.00% Top 5 Losers Medis Technologies Ltd. (MM) NASDAQ:MDTL FuelCells -26.40% |
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