Is Alternative Energy the Next Boom Market?

[Guest]

Re: Is Alternative Energy the Next Boom Market?

Zoog,

I never replied to your post about the Charley Maxwell article. Late is better than never. Belatedly therefore, thanks for that reply!

[PeterM]

Re: Is Alternative Energy the Next Boom Market?

Alt Energy will be big thing in the future .... and probably it will become more bubbly.... but take extreme caution.

There are a lot of companies out there with lofty stockprices that are sold on promises and ideas that never will be realized. Must be like pre dot.com activity.

I still remember 15 years ago when a company tries to convince the firm I worked for at the time to invest in their cellulytic ethanol technology. We didn't fortunately.
The ideas are often good ... theoretically ...., but the technology and/or economic issues often prove to be not feasible.

Apart from Brazilian cane ethanol I have not yet seen anything in the transport energy that really makes sense economically at the moment.
This includes corn ethanol .... good for spending subsidies and buying votes,....
But I cannot imagine any of those plants being built at the moment will make money in the long term (without protection import tariffs from cane ethanol, and mandatory ethanol in petrol inclusion levels). Just have a look at the corn cost and DDGS sales prices they use for their investment scenarios.
And that is even without contemplating the low EROI and the fact that with all arable US land you can only replace 20% of the petrol use..... while at the same time increasing food prices. What is more important ... food or petrol?

Most plans related to cellulytic ethanol with ideas of different fiber pre-treatments (heat/acid/enzyme/extrusion to name a few), sound promising but most have a low EROI, large scale or even pilot scale technology is not proven, and projections work with low input feed (straw/wood, etc) costs.
Some routes to cellulytic ethanol are technically feasible now, but require cheap fiber input and .... cheap energy (electricity / natural gas) to run the process.


Biodiesel from rape/used fat etc. works and is common practice in Europe proven. Palm based biodiesel of course works too, but large tracts of forests are cleared e.g. in Indonesia to produce this 'green fuel'.:rolleyes:

Biodiesel from algea has considerable hurdles. When you go in detail over their investment cost estimates and assumptions on production and growth rate of the algea some of it makes no sense....... I have seen calculations where the energy output from algeal oil was bigger than the light photon energy coming in.:eek: (even with processes where extra CO2 was added).
But hey, if you get a good story out there you can make a killing and disappear before the thing really produces.


Some pyrolysis (gasing) projects and then gas_to_liquid (GTL) might work, e.g. Choren. Complicated story there ... the devil is again in the detail. Again the cost of getting fiber/waste to the plant is often not included in the feasibility assessment. Probably details to be sorted out later.... lets first develop the process and engineer it.
Having worked a decade leading European process research/development in an Agri Multinational one thing I did learn the hard way was that it takes a lot more than working technology to get from a process to a built factory and getting it to deliver base-line financial contributions. It is fun though when it does. :cool:


For non-transport energy (electricity) things are more promising:

Wind Energy is proven and makes money.

Photo Voltaic works technically ....but economically it needs huge subsidies. The danger here is that thin film and other PV developments might destroy the current PV companies working with silicum based PV.

Geothermal ... very promising ... certainly combined with new low delta_T electricity generation developments.

Tidal electricity ... my knowledge is limited on that one ....but the case looks compelling.


This is just a shortlist there are a lot more more developments.
A lot of possibilities, and I reckon that there are a lot of hyping, misconceptions and snake-oil salesmen out there. A lot of companies will not make it.
So if you are investing instead of speculating ....spread your bets ... or study the details.

This is of course my private opinion.... the usual disclaimers apply

[Tet]

Re: Is Alternative Energy the Next Boom Market?

re verenium: what do you make of this chart??

Looks like it's ready to go higher.




Looks ready to me, I don't play the penny stocks though, insiders are buying, not a lot of daily volume which could be a problem but does allow for easy upside manipulation, maybe they rally it into earnings to be announced on August 7th and disappoint on earnings then. Upside looks like something over $12 making it past $6 could prove to be a problem, not a whole lot more downside here which is good. Looks good to me for those playing these types of stocks, I think I'd wait for it to break through $6 maybe about $6.25 to confirm a move higher before I bought.

[Guest]

Is Alternative Energy the Next Boom Market?

Investing without trading ...

Conoco Philips, Schlumberger, Apache.

[zoog]

Re: How about petroleum as the next boom market?

Earlier in this thread about alternative energy as the next hot thing, Lukester wonders if petroleum is the next boom market, while over in the Gazprom thread today, Moe_Gamble posts an article warning about "production stagnation" in Russian oil companies, and another article that says BP is investing Ł32m in jatropha for biodiesel production. Perhaps one could invest in BP and a few other carefully-chosen oil companies and catch an upswing either way?

While I do think some of the big oil companies have their heads in the sand, I think some of the others are just feigning blissful ignorance, while quietly investing in alternatives. BP has been fairly public about their operations beyond oil. I believe the smart oil companies will strive to become major players in alternative energy production and distribution.

Admittedly, one is not likely to get rich investing in an already well-established global corporation. But as oil prices go up, it is likely that oil stocks will go up as well, at least until there is a panic about a particular company running out of supply. If said company is already established in something like biodiesel or wind, the stock value might bridge the gap as they shift from oil as a primary focus to something else.

PeterM's excellent comments on alternative energy stumbling blocks duly noted. This is not going to be easy, and many companies will fail in the attempt.

[Tet]

Re: Is Alternative Energy the Next Boom Market?

re verenium: what do you make of this chart??

Great find, up over 6% today.

[bill]

Re: Is Alternative Energy the Next Boom Market?

http://www.windaction.org/news/10649

News

Florida to get tougher emission standards
July 10, 2007 by Mary Ellen Klas in Miami Herald

Florida will adopt California's car-pollution standards -- the toughest in the nation -- and become the first state in the Southeast to enact targets for reducing greenhouse gases, under executive orders Gov. Charlie Crist plans to sign Friday in Miami.

Drafts of the orders released Tuesday would require the state Secretary of Environmental Protection to immediately adopt rules to limit pollution-causing emissions for cars, diesel engines and electric companies.
The orders also impose tough new energy conservation goals for state agencies, demand better fuel efficiency from state-owned vehicles and require state cars to ``use ethanol and biodiesel fuels when locally available.''
But the most optimistic step in Crist's green agenda is the requirement to lower the amount of carbon dioxide in the air to 1990 levels by 2025, and reduce those levels by 80 percent by 2050, in spite of what is expected to be a near doubling of the state's population.
''Florida is the second-fastest growing state in the union with respect to the annual increase of new greenhouse gas emissions,'' the governor's draft order states, adding ``immediate actions are available and required to reduce emissions of greenhouse gases in Florida.''
Crist will sign the orders at a two-day climate change summit he is hosting in Miami beginning Thursday. The summit will feature speeches by California Gov. Arnold Schwarzenegger and environmental activists Robert Kennedy Jr. and Theodore Roosevelt IV.
The governor's orders say the new rules can be enacted without approval from the Legislature because they are based on already-existing state environmental laws.
The orders would bring Florida's pollution controls up to par with at least two dozen other states on the East and West coasts, but would be the strictest in the Southeast.
Former Gov. Jeb Bush rejected appeals from environmentalists to support similar pollution control standards, although he quietly drafted a carbon-reductions policy in the final months of his term.
Crist, who was elected in November, has vowed to make reducing greenhouse gases in Florida a priority of his administration. One of the orders he will sign says the state's vulnerability to rising ocean levels and violent weather makes ``global climate change is one of the most important issues facing the State of Florida and this century.''
Under the California emissions standards, automakers that sell cars in Florida beginning with the 2009 model year would have to reduce greenhouse gas pollutants, such as carbon dioxide, by 25 percent for cars and 18 percent for sport utility vehicles.
At least 12 other states have adopted California's standards, including New York, New Jersey and Pennsylvania. Automakers are challenging the standards in court and, for two years, the federal Environmental Protection Agency has refused to allow the new law to take effect.
Environmentalists hailed the proposals and utility executives said they were cautious but encouraged.
''They're very significant and very comprehensive,'' said Susan Glickman, a consultant for the National Resources Defense Council and other environmental groups. ``It's clear from these executive orders that he is dead serious about reducing [carbon dioxide] emissions. The governor's goals now provide the starting point for the Legislature to enact them.''
The governor's orders also require electric companies to reduce greenhouse emissions to 2000 levels by 2017 and to the 1990 levels by 2025. They also ask the Public Service Commssion, the state agency that regulates utilities, to impose rules this year that require electric companies to produce 20 percent of their electricity from renewable sources, ''with a strong focus on solar and wind energy.'' Regulators would set the deadlines.
Florida Power & Light President Armando Olivera said he hadn't seen the proposed executive order but the company, the largest producer of solar-power and wind-power energy in the nation, generally supports increasing the state's reliance in renewable energy.
''It depends on what the rules are and how those rules are developed,'' he said. ``But we are obviously very supportive of renewables and we think it should be a huge element of our energy policy.''
Crist's orders include several elements of an energy bill passed by legislators that he vetoed last month because it didn't go far enough.
Among them: State agencies must buy cars cars with the highest fuel efficiency, maintain vehicles to maximize maximizes gas mileage and use biofuels when possible instead of gasoline. Rental car contracts must put a priority on fuel efficiency.
The state will also give agencies a ''preferred products list'' and require that meetings and conferences take place in hotels or centers that have been given a ''green lodging'' certification from the Department of Environmental Protection.
Sen. Lee Constantine, an Altamonte Springs Republican who supported the bill Crist vetoed and authored a bill last year that authorized a state energy plan, said he was encouraged by the governor's proposals but considers it the first step.
''The goal here is to move forward fast,'' he said. ``I'm hopeful the executive order does that but we still have to do legislation.''



Web link: http://www.miamiherald.com/416/story/166518.html

Florida Climate Change Summit:http://myfloridaclimate.com/

[bill]

Re: Is Alternative Energy the Next Boom Market?

EJ Says the US government program will include a floating tariff on energy imports to maintain prices, increase tax revenues, and protect Alt Energy investors;

Any new details on this plan?

[renewable]

Re: Is Alternative Energy the Next Boom Market?

Tidal electricity ... my knowledge is limited on that one ....but the case looks compelling.

Tidal is currently the preserve of the large civil engineering companies that are able to build big dams across rives with large tidal ranges and use conventional turbines in an open section of the dam. There are lots of ideas for small scale systems - such as what are effectively under water wind turbines (turned by water currents rather than air streams), but these are nowhere near economical and may only ever become so in waters with strong tides.

Wave power is interesting, too.

[zoog]

Barrons article from the future

Apparently Barrons has a time machine, and they are testing it out with little steps, as here is an article from this coming Monday, July 16 called Cleaning Up.

Venture capitalists plunked down better than $1.5 billion in funding for clean tech in 2006, bringing the total to $4.2 billion since 2000, according to the National Venture Capital Association. These strong inflows have helped launch 1,500 start-ups worldwide.


"These companies are popping up like weeds, just like dot-coms, but hopefully with better rates of success," says Vinod Khosla, the well-respected venture capitalist who founded Khosla Ventures and is an affiliated partner at Kleiner, Perkins, Caufield and Byers.

Clean tech no doubt will suffer from some of the same ills as the Internet: Already, solar stocks are frothy... ethanol shares have soared only to plunge as corn prices rose, and some fuel-cell companies seem to have borrowed their business plans from long-departed Web enterprises. But the sector also appears to be a fertile source of profitable growth investments for the next decade or more.

In part, this is because governments worldwide are expected to pass tougher environmental laws aimed at saving the planet, by forcing industry and utilities to do less harm. Global accords like the Kyoto Protocol, which limits carbon-dioxide emissions and promotes trading of emission rights, are gaining. Just last week in the U.S., which didn't agree to the protocol, the Senate introduced a measure that would mandate a "cap and trade" system that limits total emissions and then allows carbon-dioxide producers to trade emission credits.


"The likely trajectory of legislation on global warming is creating a great investment opportunity," says Khosla.

As in biotech, venture capitalists are more likely to exit their investments in clean tech via buyouts rather than IPOs.

They will also compete against huge multinationals, which are likely to be active acquirers both for defensive purposes and as ways to enter new areas, Dolezalek says.


Instead of Big Pharma, it will be oil, chemical, agricultural, and energy-utility behemoths, among them companies like General Electric, BP, Dow Chemical, ConAgra, Monsanto that will be on the prowl for these companies.

didn't I essentially say that a few days ago? duh

I believe the smart oil companies will strive to become major players in alternative energy production and distribution.

One of the early success stories and highfliers is SunPower (SPWR), a majority-owned spin-off of Cypress Semiconductor (CY).

... the shares hit their 52-week high last week at 69.80, or a pricey 36 times 2008 earnings. Some insist it's worth it for high-quality growth. Merriman Curhan's target is 75. Says one angel investor: "It's rich, but it's kind of like buying Microsoft in the early '90s. It will just stay rich."

Another alternative start-up is New Hampshire-based Environmental Power Corp. (EPG), a big bet on the institution of emissions caps and the trading of pollution credits in the U.S. The company's technology cuts the natural release of animal-produced methane...

...Analyst Tanous estimates the credits could be worth as much as $4.6 million, or 33 cents a share, by 2009.

Making power plants run more efficiently at lower costs is a big-step toward cleaning the air, which is where Fuel Tech (FTEK) comes in. It is a $75 million-in-revenue company that installs air-pollution controls that improve the performance of combustion furnaces.

Analysts at Lux Research project a $3 billion market opportunity in clean water, but the area has attracted only $154 million in venture-capital funding since 1995.

...PICO Holdings (PICO), which is essentially an asset play, has been acquiring water rights throughout the West with plans to redistribute fresh water to areas where it's in short supply.

Another knock on wind energy has been the availability of windmills, or wind turbines. Composite Technology (CPTC.OB) hopes to help solve that problem. Its wholly-owned subsidiary, DeWind, is expected to release a new turbine later this year that should challenge General Electric and help address a significant global backlog. The shortfall in supply, Tanous explains, has occurred because GE, a major producer of turbines, owns much of the intellectual property and has made it difficult for others to compete without paying licensing fees.


But Irvine,Calif.-based Composite has developed its own technology, allowing it to cut into pent-up demand and earn high-profit margins.

In some sense, bubble markets are a rite of passage for any new growth technology -- a validation of sorts.

hmm.

[bill]

Re: Is Alternative Energy the Next Boom Market?

Looks like the Corporations want Cap-and-Trade.

A Cap-and-Trade bill "Low Carbon Economy Act of 2007"

The bill:http://energy.senate.gov/public/inde...ssueItem_ID=55





http://www.snl.com/interactivex/arti...6001167&KPLT=2

Senate bill details plan for distributing emissions allowances
July 11, 2007 4:44 PM ET
By Kathleen Hart

Source URL http://energy.senate.gov/publi...

Related Documents Industry Overview Presentation "Bingaman/Spector Climate Change Bill" presented on 7/10/2007

Related Articles 7/10/2007 Senate energy leader to sponsor bill with mandatory cap on carbon emissions

Senate Environment and Natural Resources Committee Chairman Jeff Bingaman, D-N.M., and Sen. Arlen Specter, R-Pa., introduced bipartisan legislation on July 11 designed to reduce U.S. greenhouse gas emissions by creating an economywide mandatory tradable-permits system. The bill sets out a detailed method for distributing tradable emissions allowances.
The target is to reduce U.S. greenhouse gas emissions to 2006 levels by 2020 and to 1990 levels by 2030.
A majority of the tradable emissions allowances would be given out for free to the private sector at the start of the program. The amount would be gradually reduced each year after the first five years of the program. In addition, 8% of allowances would be set aside each year to create incentives for carbon capture and storage and to jump-start technologies.
The government would auction 24% of total allowances to generate revenue for research, development and deployment of low- and no-carbon technologies, to provide for climate change adaptation measures and to assist low-income households.
Another 5% of allowances would be reserved to promote agricultural sequestration, and 1% would be used to reward companies that have undertaken "early actions" to reduce emissions before program implementation.
Finally, 9% of the allowances would be distributed directly to states to use at their discretion to address regional impacts, promote energy efficiency and enhance energy security.
"This legislation provides a deliberative and measured response to climate change," Specter said. "It brings together many interest groups in the fight against global warming, and I believe this is a bill that can be passed."
By setting an annual target and allowing firms to buy, sell and trade credits, The Low Carbon Economy Act of 2007 is designed to achieve cost-effective carbon reductions across the economy. Specter and Bingaman said that the target and technology incentives are designed to avoid harm to the economy while promoting a gradual but decisive transition to new, lower-carbon technologies.
To limit economic uncertainty and price volatility, the government would allow firms to make a payment at a fixed price in lieu of submitting allowances. This "technology accelerator payment" price starts at $12 per metric ton of CO2 equivalent in the first year of the program and rises steadily each year thereafter at 5% above the rate of inflation.
If technology improves rapidly and additional policies such as fuel efficiency standards and a renewable electricity standard are adopted, the payment option would never be engaged, the senators said. However, if technology fails to improve rapidly and program costs exceed predictions, the program would allow companies to make a payment into an "energy technology deployment fund" at the technology accelerator payment price to cover a portion of their entire allowance submission requirement.
Under the legislation, greenhouse gas emissions from petroleum and natural gas are regulated upstream, at or close to the point of fuel production. For these fuels, regulated entities are required to submit tradable allowances equal to the carbon content of fuels produced or processed at their facilities.
Greenhouse gas emissions from coal are regulated "downstream," at the point of fuel consumption. Regulated entities that must submit allowances include petroleum refineries, natural gas processing plants, fossil fuel importers and large coal-consuming facilities.
"There is a great desire in our country to address the global warming crisis," Bingaman said in introducing the bill. "I believe our legislation represents a strong and balanced approach. It will dramatically reduce U.S. greenhouse gas emissions while also spurring new energy technologies, protecting the American economy and engaging developing nations in their efforts to address climate change."
To engage developing countries, the legislation would fund joint research and development partnerships and technology transfer programs.
The bill also calls for a five-year review process requiring a reassessment of domestic action in light of efforts by major U.S. trade partners and scientific and technological developments.
If sufficient international progress is made in reducing greenhouse gas emissions, the president could recommend changes in the U.S. program to achieve further reductions that are at least 60% below current levels by 2050. However, if other countries fail to make adequate efforts, starting in 2020 the president could require importers from such countries to submit special emissions allowances from a separate reserve pool to cover the carbon content of certain products.
Sens. Tom Harkin, D-Iowa, Ted Stevens, R-Alaska, Lisa Murkowski, R-Alaska, and Daniel Akaka, D-Hawaii, co-sponsored the legislation.
For a chart of climate change bills currently introduced in the Senate, please see the document attached to this article.

[zoog]

Re: Is Alternative Energy the Next Boom Market?

A majority of the tradable emissions allowances would be given out for free to the private sector at the start of the program. The amount would be gradually reduced each year after the first five years of the program. In addition, 8% of allowances would be set aside each year to create incentives for carbon capture and storage and to jump-start technologies.

The government would auction 24% of total allowances to generate revenue for research, development and deployment of low- and no-carbon technologies, to provide for climate change adaptation measures and to assist low-income households.

Another 5% of allowances would be reserved to promote agricultural sequestration, and 1% would be used to reward companies that have undertaken "early actions" to reduce emissions before program implementation.

That seems to jive with this:

3. Law of Government Assistance. The hyper-growth phase of an asset bubble cannot develop without government assistance—in the form of accommodative monetary policy, tax incentives, or both.

[Rajiv]

Re: Is Alternative Energy the Next Boom Market?

Sorry to be a wet blanket, but do read the following relevant articles regarding alt energy technologies

If Brazil Can Do It…

The Cellulosic Ethanol Delusion

Hot Air - The False Promises of Wind Power Generation

[zoog]

Re: Is Alternative Energy the Next Boom Market?

The stochasticity of wind-power generation can be seen by looking at July 2006. During that month, wind turbines in California produced power at only about 10 percent of their capacity; in Texas, one of the most promising states for wind energy, the windmills hit about 17 percent. Studies in Europe have shown similar results. In Britain, a recent study found that between October 2006 and February 2007, there were 17 days when the output from the country’s windmills was less than 10 percent of their rated capacity and 5 days when output was less than 5 percent.

That's pretty dismal.

I would add to that, not every place has enough potential wind to even consider wind power. See maps such as this.

[bill]

Re: Is Alternative Energy the Next Boom Market?

Sorry to be a wet blanket, but do read the following relevant articles regarding alt energy technologies

Hot Air - The False Promises of Wind Power Generation

Facts:
http://www.awea.org/pubs/factsheets/...Fact_Sheet.pdf

http://www.nrel.gov/wind/publications.html

http://www.eere.energy.gov/windandhy...wpa_update.pdf

I think wind has good potential at 80m http://firstlook.3tiergroup.com/ and or using low speed wind technology turbines at low speed wind sites. The wind industry still has a lot of kinks in it as well as very few statistics, however it is growing. Now if you’re looking for an answer to our nations future non carbon energy supply needs, wind will contribute to that need but not fulfill it completely. If alternative energy including wind is not subsidized by a permenate carbon taxable system as in the past it will go down as another failed cycle to the industry.