Relaxnews
Tuesday, 14 December 2010
Cascadia Capital, an investment bank serving both public and private growth companies around the world, has published its predictions for sustainable industries in 2011. One of the four predictions is that waste-to-energy technologies will grow and become part of mainstream society.
Though focused on the corporate end of the renewable energies spectrum, Cascadia Capital's "Top Sustainable Industries Predictions for 2011" are important as they hint at what the future could contain for green products.
Of particular interest to consumers are the "waste as energy" trend and the work of companies such as InEn Tec. InEn Tec, which was recently honored as 2010 Top Innovator by the Wall Street Journal, uses new technologies to transform industrial, household and even medical waste into electricity and fuel for transport; Cascadia Capital predicts that by 2011, continued investment in this area could lead to the widespread commercialization of waste to energy technology and lead the way for cars or houses that are indirectly powered by household waste.
More information and videos about waste to energy technology can be found at: http://www.energyplanet.info/Waste_Energy/, via the US Environmental Protection Agency website and from ESWET in the European Union. Videos providing an overview of waste to energy technology such as An Overview can be found on YouTube courtesy of the Pure Energy Systems Network and other groups.
Published on December 6, the four key predictions for sustainable industry in 2011 according to Cascadia Capital are:
1. Cap and trade discarded by Congress in National Energy Policy (US)
Cascadia Capital predicts that the US Congress will implement a policy that focuses on gas, nuclear and renewable energies, but it will not offer companies economic incentives to lower their carbon footprint (such as cap and trade).
2. Rising oil prices lead to investments in natural gas
Cascadia Capital also predicts that oil will rise to over $100 (€75.12) a barrel, leading companies to expand their operations into the field of natural gas, which will continue to be seen as a viable supply of alternate energy.
3. Waste to energy technology
Technology that converts municipal solid waste into energy will be ready for commercialization in 2011; according to Cascadia Capital's predictions, this drive for commercialization will be led by companies such as InEn Tec and Plasco Energy Group.
4. Traditional energy companies pursue acquisitions in renewable energy
Companies such as BP, Chevron and Shell will acquire renewable energy technology companies; the majority of these mergers and acquisitions will be focused on wind, solar and waste to energy.
Tuesday, 14 December 2010
Climate Funds Move Beyond Wind, Solar
By SAM MAMUDI
The poor performance of some sectors aiming to slow climate change is pushing money managers to cast further afield for investments that both carry green credentials and are likely to post better returns.
Some renewable-energy stocks, such as those in solar and wind industries, have fallen spectacularly in recent years, belying hopes that they were poised to break out.
Money managers say this poor performance is due in part to a lack of hoped-for policies to help these industries grow. As a result, say the managers, they are looking at other areas of the market that are part of the climate-change story, such as recycling and energy efficiency. Even eBay Inc., as a promoter of reusing goods, fits the bill.
"Nobody's questioning the long-term prospects, market share or gains of [renewable energy] sectors, but over the medium [term], it's not been that good," said Vipin Ahuja, manager of Allianz RCM EcoTrends Fund (trading symbol AECOX). "So people are looking elsewhere for sustainable stories for the next couple of years."
Mr. Ahuja's fund, which he joined about one year ago, is down 19% a year in the past three years, according to data from Morningstar Inc.
The deteriorating prospect for new policies to combat climate change was palpable at the recent United Nations Climate Change Conference in Cancun, where delegates from nearly 200 countries met to hash out a possible extension of the Kyoto Protocol and other policies. The more sober atmosphere this year, particularly compared to the gathering's predecessor in Copenhagen, reflected toned-down hopes that the world's largest polluters would reach agreement on policies to combat global warming and promote renewable energy.
Those downgraded expectations have left their mark on solar-panel stocks, once Wall Street darlings.
In mid-2008, First Solar Inc.'s stock traded at close to $300. Today, it is near $137.
It is a similar story with many of First Solar's peers, including SunPower Corp., whose stock has fallen to under $14 from close to $100 in the past 30 months. The MAC Solar Energy Index is down an annualized 27% in the past three years.
Others in the renewable-energy space have also suffered, such as wind turbine maker Vestas Wind Systems A/S, which has seen its stock price fall to less than $31 a share on Monday from more than $140 in 2008.
One example of how politics has hurt the renewable sector is the failure to pass a federal renewable portfolio standards policy. The rule would have forced utility companies across the U.S. to supply a certain amount of their energy from renewable sources.
"That discouraged many utilities from signing, for example, agreements for wind [farm] installations," said Colm O'Connor, a portfolio manager at Kleinwort Benson Investors who is part of the management team of Calvert Global Alternative Energy Fund (CGAEX), which is down an annualized 26% over the past three years, according to Morningstar.
"In the past year, we've avoided wind and solar investments," said Richard Mercado, manager of London-based F&C Global Climate Opportunities Fund.
Mr. Merchado said the fund has been looking more at the natural-gas sector, and—in a theme several money managers repeated—also at so-called mainstream companies with a climate-change slant. For example, eBay is one of the fund's investments as it "promotes reusing products and not throwing them out," said Mr. Merchado.
Mr. Merchado said the most represented sector in the fund is energy efficiency. Several other managers pointed to developments in LED technology as an example of the trend. As the costs come down, use of light-emitting diodes in anything from televisions to traffic lights increases, and lighting for commercial spaces becomes possible.
Another example of looking at efficient, rather than renewable, energy is demand-response technology. These services let utilities manage consumer demand more efficiently by relaying energy-usage data back to providers.
Mr. O'Connor said he plays demand response by investing in meter makers such as EnerNoc Inc. and Comverge Inc.
Ben Allen, director of research at Parnassus Investments, said that since 2007, his firm has invested in Waste Management Inc., which he said has been focusing on energy efficiency by turning waste into electricity. Another company Parnassus likes is Cooper Industries PLC, in part because of the company's growing LED business.
Allianz RCM's Mr. Ahuja said his fund's holdings in LED-related companies went from zero to about 15% in the past year.
Write to Sam Mamudi at smamudi@marketwatch.com
The poor performance of some sectors aiming to slow climate change is pushing money managers to cast further afield for investments that both carry green credentials and are likely to post better returns.
Some renewable-energy stocks, such as those in solar and wind industries, have fallen spectacularly in recent years, belying hopes that they were poised to break out.
Money managers say this poor performance is due in part to a lack of hoped-for policies to help these industries grow. As a result, say the managers, they are looking at other areas of the market that are part of the climate-change story, such as recycling and energy efficiency. Even eBay Inc., as a promoter of reusing goods, fits the bill.
"Nobody's questioning the long-term prospects, market share or gains of [renewable energy] sectors, but over the medium [term], it's not been that good," said Vipin Ahuja, manager of Allianz RCM EcoTrends Fund (trading symbol AECOX). "So people are looking elsewhere for sustainable stories for the next couple of years."
Mr. Ahuja's fund, which he joined about one year ago, is down 19% a year in the past three years, according to data from Morningstar Inc.
The deteriorating prospect for new policies to combat climate change was palpable at the recent United Nations Climate Change Conference in Cancun, where delegates from nearly 200 countries met to hash out a possible extension of the Kyoto Protocol and other policies. The more sober atmosphere this year, particularly compared to the gathering's predecessor in Copenhagen, reflected toned-down hopes that the world's largest polluters would reach agreement on policies to combat global warming and promote renewable energy.
Those downgraded expectations have left their mark on solar-panel stocks, once Wall Street darlings.
In mid-2008, First Solar Inc.'s stock traded at close to $300. Today, it is near $137.
It is a similar story with many of First Solar's peers, including SunPower Corp., whose stock has fallen to under $14 from close to $100 in the past 30 months. The MAC Solar Energy Index is down an annualized 27% in the past three years.
Others in the renewable-energy space have also suffered, such as wind turbine maker Vestas Wind Systems A/S, which has seen its stock price fall to less than $31 a share on Monday from more than $140 in 2008.
One example of how politics has hurt the renewable sector is the failure to pass a federal renewable portfolio standards policy. The rule would have forced utility companies across the U.S. to supply a certain amount of their energy from renewable sources.
"That discouraged many utilities from signing, for example, agreements for wind [farm] installations," said Colm O'Connor, a portfolio manager at Kleinwort Benson Investors who is part of the management team of Calvert Global Alternative Energy Fund (CGAEX), which is down an annualized 26% over the past three years, according to Morningstar.
"In the past year, we've avoided wind and solar investments," said Richard Mercado, manager of London-based F&C Global Climate Opportunities Fund.
Mr. Merchado said the fund has been looking more at the natural-gas sector, and—in a theme several money managers repeated—also at so-called mainstream companies with a climate-change slant. For example, eBay is one of the fund's investments as it "promotes reusing products and not throwing them out," said Mr. Merchado.
Mr. Merchado said the most represented sector in the fund is energy efficiency. Several other managers pointed to developments in LED technology as an example of the trend. As the costs come down, use of light-emitting diodes in anything from televisions to traffic lights increases, and lighting for commercial spaces becomes possible.
Another example of looking at efficient, rather than renewable, energy is demand-response technology. These services let utilities manage consumer demand more efficiently by relaying energy-usage data back to providers.
Mr. O'Connor said he plays demand response by investing in meter makers such as EnerNoc Inc. and Comverge Inc.
Ben Allen, director of research at Parnassus Investments, said that since 2007, his firm has invested in Waste Management Inc., which he said has been focusing on energy efficiency by turning waste into electricity. Another company Parnassus likes is Cooper Industries PLC, in part because of the company's growing LED business.
Allianz RCM's Mr. Ahuja said his fund's holdings in LED-related companies went from zero to about 15% in the past year.
Write to Sam Mamudi at smamudi@marketwatch.com