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Editors Picks Green Is the New Green
Editors Picks Green Is the New Green 
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| Green Is the New Green |
| Saturday, 24 November 2007 | ||||||||
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You may not think that doing a slideshow about greenhouse gas emissions has much to do with world peace, but it does tell us about how hyped up everybody from the scientific community to politicos have become about the whole global warming thing. But what really matters--beyond discussing the end of days and all of the stuff from Revelations and such--is that global warming has us and billions more around the planet thinking about being greener. Green, meaning cold, hard cash. Warming fever is spreading like wildfire around the world. Public and private capital is being thrown at companies with reckless abandon, from blue chips to start-ups. Stock prices for companies that can be positioned as climate-friendly are soaring, even if underlying business basics are lacking. But results are results, and those who have invested with the emerging trend are realizing both varieties of green. The PF Growth Portfolio already includes companies on the receiving end of climate cash, Monsanto based on biofuels and Siemens and Toshiba due to nuclear power. But the biggest boom is being felt by the smaller fry, and we’ve come up with a climatic collection of companies cashing in on growing concern over global warming. Just like the go-go days of the Internet, we can get on board a collection of potentially market-changing companies that are all about cashing in on the world's appetite,companies addressing greenhouse gas emissions. I'll start with the glow of the sun. Solar is one of the first alternative energy groups to cash in on warming fever. SunPower Corp (NSDQ: SPWR) designs and markets photovoltaic (PV) solar cells, cells that convert sunlight into electrical energy. When evaluating solar power companies, the key is to understand how efficiently a company's cells turn solar energy into electricity. The industry average is around 14 to 16 percent; SunPower's current least-efficient cells are around 20 percent conversion efficient, while its state-of-the-art cells manage closer to 22 percent. This is the highest efficiency ratio of any company in the solar industry. SunPower can generate the same amount of power as competitors' cells using a unit that's far smaller. And SunPower cells require less polysilicon, the key raw material used to make solar cells and semiconductor chips, which is in extremely short supply right now. The company is a solar power leader in California and Spain, markets that are both enjoying strong government support and rapid growth. In fact, Spain recently hiked its target for installed solar capacity from 400 megawatts to 1.2 gigawatts by 2010. Solarworld (Frankfurt: SWV, OTC: SRWRF) is headquartered in the world's largest solar PV marketplace; Germany is home to nearly 40 percent of the world's PV capacity. Germany's solar industry has grown rapidly thanks to a generous feed-in tariff structure that guarantees solar power generators a high price for all the power they generate. And the company is on track to expand: Spain, Greece, Italy and France have all adopted feed-in tariff structures that will continue to subsidize solar power capacity expansion for as long as 25 years. In addition, the company has one of the most advanced polysilicon recycling plants in the world. By recycling the key material, SolarWorld cuts down on its need to purchase raw material. We aren’t limited to the new-age greenies for profit opportunities; old-line companies have new green coming their way because they supply necessary components for solar power. Semiconductor chips are the basic building block of most modern electronic devices. St. Louis-based MEMC Materials (NYSE: WFR) is a leading supplier of raw polysilicon and wafers to both markets.Right now, the semiconductor market for polysilicon is worth roughly $10 billion per year, and the market for solar is about $4 billion. But the market for solar cells is growing at a 30 percent annualized rate, around three times the growth rate for semis. MEMC is the third-largest supplier of wafers to the semiconductor industry and has a market share of around 15 percent. Its market share in solar is less than 5 percent, but the company has plans to boost its share to 15 percent in the next few years.Another form of warming-friendly energy that’s profiting from climate cash is wind power. Vestas Wind Systems (Denmark: VWS, OTC: VWSYF) is the world's largest producer of wind turbines; the company has captured more than a third of the global wind turbine market. That market is expanding at a rapid pace, aided by generous government subsidies. In fact, demand has been so strong this year that there has been a global shortage of components needed to manufacture turbines; Vestas' order books are full.
Spain's Gamesa (Madrid: GAM; OTC: GCTAF) has a roughly 15 percent share of the global wind-turbine market and is also a generator of wind power. Gamesa sold off most of its operations outside the wind market last year to become a purer play on the growth of wind power.Excerpted : Pay Me Weekly This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
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