Increased demand for solar as a viable and environmentally-friendly method for power generation. Rising oil prices appear to be helping solar stocks. And, as the AP reports in an energy roundup, now may be a good time to think about renewable energy investing:
"Market psychology favors renewables when there are reminders of the "finite" nature of petroleum reserves, said Cowen & Co. alternative energy analyst Rob Stone. ...When oil enters new trading ranges, that has a significant impact on the group," Stone said in a phone interview. "You saw further discussion this morning of whether oil was going to breach $100."
As oil prices continue to cause concern over such issues as refining margins (Chevron - CVX - and Marathon Oil - MRO - are especially hard hit right now), the time for a shift in energy investing may be coming.
Most energy stocks are down right now, even giant ExxonMobil (XOM). But some, like Ascent Solar Technologies (ASTI), are on the rise. And even though SunPower (SPWR) is down right now, it has shown itself to be a strong company fundamentally, especially in terms of solar stocks. Solid renewable energy investing now could be of great benefit down the road. SPWR is solid, and ASTI offers a bargain price. Either of them may good choices in a long-term buy and hold strategy. However, it is important to realize that solar stocks, and other renewable energy investing, tends to be rather volatile - and hence riskier - since most of the companies are new.
Perhaps one of the reasons Big Oil has been reluctant to let gas prices catch up with oil prices is because when people see gas prices skyrocketing, they tend to start thinking about alternative energy. And it seems that this reaction is starting to be borne out as solar stocks gain on the back of rising oil prices.
Panel prices are declining at a very fast rate and sooner solar power will achieve cost competitiveness compared to other renewable technologies. The fall in prices will trigger demand for solar panels world wide, thereby benefiting solar companies. This price drop will also be fueled by more efficient use of polysilicon ingots, particularly in the wafer slicing segment of the value chain, where NorSun (largest player, based in Norway, private), is testing cleaving by ion implantation, which has the promise of 2-4X yield improvement http://www.sigen.net/articles/SiGen_NorSun.pdf. But isn't falling panel prices negative for a commodity like solar panel? Well the answer is yes, but the decline will cause pricing pressures at solar panel makers end, who'll in turn pressurize and bring down raw material (poly silicon) costs. So at the end of the day, margins remain the same. more panels would mean high volumes, and hence high returns.
In late February, First Solar announced that it had hit the landmark production cost of $1/watt - a cost-level that has long been touted as one that would put the solar industry on a cost-competitive basis with other sources of electricity. Other solar companies are working hard to bring their costs down to the same level; at this pace, the industry should be competitive with fossil fuels in just a few years.
The economy is starting to see signs of recovery and investment related to solar energy is starting to take shape.
Companies in the sector have already begun rolling up their sleeves. Chinese company Suntech Power Holdings is currently working on establishing its first manufacturing plant in the U.S.
Suntech Power Holdings is not the only company looking to expand its U.S. presence: Trina Solar Limited, for example, is reportedly looking for partners for a U.S. project. SunPower, a Calif.-based manufacturer that makes its panels everywhere but the U.S. (including Mexico, the Philippines and China), plans to bring its new facility a bit closer to home. Even good old GE has launched a solar panel production pilot program in Colorado.
General Electric Corp. (GE) is strengthening its commitment to clean energy with a $230 million (150 million euros) investment in Spain’s Fotowatio. The investment, made through GE’s Energy Financial Services unit, will amount to a 32% stake in the solar-energy firm.
“By facilitating the growth of one of the solar industry’s leading developers, this investment gives us immediate access to attractive solar markets in Europe and the United States and will form an important part of GE’s broader strategy to become a major player in solar power,” Alex Urquhart, President and CEO of GE Energy Financial Services, said in a statement. “GE has all the right ingredients to succeed in solar: capital, technology, research and ecomagination.”
Ecomagination is GE’s in-house term for its program to help customers meet their energy needs through cleaner technologies such as solar and wind power. The company recently announced that its alternative energy investments had crossed the $4 billion threshold.
Thanks to companies like Quantum Materials Corp and their subsidiary Solterra Renewable Technologies, Inc. (ticker - QTMM) they are in the forefront of a new Flexible Solar Power Industry that will replace the silicon wafer-based solar cell industry with Thin Film Quantum Dot Photovoltaic Solar Cells. The new proprietary Quantum Dot (QD) technology is more economical, more energy efficient, has a broader spectral performance and Solterra reduced the cost of Q.D. production by more than 90%. The Quantum Dots are stable and reproducible with their new high quality Cadmium Selenide Tetrapods. These "mega-molecules" of semi conducting materials are smaller than living cells. Q.D.'s interact with light in unique ways to give off different colored light or to create electrons and holes, due partly to their tiny size, partly to their shape and partly to the material from which they are made. Quantum Dot Solar Cells have extremely high potential efficiency, having demonstrated the production of multiple excitons from a single electron. This phenomenon is the key to exponential increases in conversion efficiency. Quantum dot solar cells also have the ability to harvest light energy in the infrared and ultraviolet spectra leading to better low light collection efficiency and the potential to continue harvesting energy 24/7 even when little or no visible light is present. Solterra is a solar investors dream come true for continuing profit potential as the industry changes! That is one reason to be bullish on the solar industry but in a different sector of it as the technology changes.
With the inauguration of the European Supergrid Initiative, will the Sun shine for QTMM in Saudi Arabia? Solterra is in the running to receive one of several mega contracts the Saudi government is going to award.
Additional info requested to explain the Supergrid Initiative:
The link to the Supergrid Initiative is here: http://www.e-parl.net/eparlimages/general/pdf/081029%20The%20Supergrid%20Initiative%20nb.pdf I would be doing it an injustice trying to explain the importance or enormity of this project. QTMM's involvement would be part of the Solar Photovoltaic Energy contribution. What QMC/Solterra Renewable Technologies brings to the plate is economical 24/7 generation. This article was written in mid to late 2008 before Solterra was even a company. Since then they have brought this innovative technology into the light. Their Quantum Dot PV thin film solar cells allow energy to also be extracted from the ultra violet and infrared spectrum. I would imagine this is the kind of ground breaking technology the Consortium is looking to include in their projects. Part of the Supergrid plan is to use solar during the day and hydro at night that was powered by solar, Solterra would change some of that with additional generation around the clock, in addition the Solterra Solar Cells are cheaper. They were able to change the process and create higher quality Quantum Dots at ~10% of the current cost of conventional manufacturing, thus reducing solar cell costs. A huge advantage.
New products are being developed, and even more will be developed with complimentary benefit effects to solar power. Comments by Loyd Vernon -Sugar Land, Tx., U.S.A.
Incandescent 50 watt = cfl 16 watt = 3 watts led for the same luminescence. Shelf life, incandescent 1000 hrs, cfl 10,000 hrs rated, led 40,000 - 50,000 hours rated. All equals less power, longer life, and less maintenance. Also benefit,,,,small power need, solar charged standard automotive and marine batteries that can supply lighting for 2-3 days, enough to last through most cloudy spells.
Solar voltaic, and solar thermal will become more competitive with complementary applications.
Likely very few will ever be completely off the commercial power grids, but the technology is developing to make some serious inroads to energy conservation, peak load reductions, and lower costs. The future has some bright alternative lights shining in the distance.
A number of large solar companies, including SPWRA, STP, SOLF, and ESLR, reported increases in demand at the end of the first quarter and during the second quarter of 2009. Combined with the price of oil increasing and slightly better-than-expected margins in Q109, these demand increases may signal that the industry is past it's recessionary bottom.