Aspire Week in Review – Week Ended September 19, 2008

Sep 19, 2008
Author: Administrator

Stocks bounced back on Thursday and Friday as the Fed and Treasury announced the government is taking drastic actions to stem the financial markets crisis, which has bled through all sectors in the U.S. economy and overseas as well. Whether Paulsen et. al. are able to produce a compelling plan to the markets next week will determine whether the Street will continue to maintain its recently found bullishness – but key to the renewable and clean tech sectors, will be next week’s deliberation and vote in the Senate on the Renewable Energy and Job Creation Act.

The GOP in the Senate is taking a strong line into the session, suggesting that it may not provide the votes needed to pass the legislation, unless some material concessions are made concerning domestic drilling and tax breaks to producers. To be sure, if the legislation finds a way to pass, this will create a renewed bullishness in the renewable and clean tech sectors. If it fails, then these stocks will continue to have heavy-going, until the Congress potential reconvenes for a lame-duck session in November to deal with it once again.

Biofuels

New Generation Biofuels Holdings (Amex:GNB), signed a site lease and a terminal services agreement to locate its first commercial scale biofuel manufacturing plant at the port location of Atlantic Terminaling in Baltimore, Maryland. New Generation Biofuels expects to complete construction of the first 25 million gallon per year facility in the first quarter of 2009 and to launch production shortly thereafter. Once completed, NGB expects the facility to have a production capacity of up to 50 million gallons of second-generation biofuel a year.

After announcing a public offering of common stock, VeraSun’s (NYSE:VSE) shares dropped from $4.79 to $1.41 on a 743% increase in volume – over a two-day period.  Also, the Des Moines Register reported that VeraSun expects to post a loss of as much as $103 million for the Q3 after it “got caught on the wrong side” of a swing in corn futures last summer. This morning, VeraSun said it has retained Morgan Stanley to “evaluate strategic alternatives.” It has suspended a previous offering.

The latest USDA World Agricultural Supply and Demand Estimates report says the U.S. soybean crop will be down to 2.93 billion bushels… 39 million bushels lower than previous estimates. On a global scale, however, soybean production is projected at a record 238 million tons, up 9 percent from 2007-‘08.

In a response to critics of the U.S. ethanol market, BioFuels Journal announced it is hosting a webinar sponsored by Clean Fuels Development Coalition and the Ethanol Across America Education Campaign called “The Impact of Ethanol Production on Food, Feed and Fuel next week. Highlights of the webinar will include: 

• How ethanol is actually saving money for consumers (lowering retail gas prices).
• How by-products of ethanol production replace protein and energy feeds (increased use of distillers dried grains with solubles).
• Who the real culprit is in the rising price of food and feed (rising energy costs).
• Who the real culprit is in the rising cost of corn (high oil prices).
• What would happen if biofuels mandates were removed (rising foreign oil imports and fuel costs).

You can register for the event here.

Brazil

Bunge Alimentos bought a majority stake (60%) in a sugar and ethanol plant in the center-west region of Brazil, which is expected to become operational in 2009.

Alfred Swarz, director of Brazil’s Sugar Cane Producers’ Association said this week that Brazil is bringing on 25 to 30 new ethanol production units this year, up from about 20 in 2007. Swarz said the growth is being driven by increasing demand in the country for flex-fuel cars, which represented about 90% of total fleet sales last year, and will account for about 50% of the total Brazilian fleet by 2012.

Swarz also said that electricity generated from sugarcane bagasse totaled 1,800 average megawatts or 3% of Brazil's consumption in 2007/2008. This will grow to 14,400 megawatts or 15% by 2020.

Notes from Merriman Conference

Comanche Clean Energy, which will soon begin trading (OTCBB:CGYYF) presented this past week at the Merriman conference to a full audience. The response was positive on the company, in light of the fact that Brazil is strongest market in the world for biofuels and growth, and Comanche is quickly establishing a leading role in the market. Since 2007, Comanche has established two ethanol plants (Santa Anita and Canitar) and a biodiesel plant (Bahia). Santa Anita will produce about 44 million liters this year, with plans to ramp capacity to about 100 million liters in 2010. Canitar which is coming online in October, will produce about 100 million liters in 2009. Bahia will produce about 35 million liters in 2008. The company’s growth will continue to be driven by strong internal factors in Brazil, and its margins should continue to expand a benefit from management’s focus on better agricultural practices, higher efficiency through automation, as well as expectations from secular trends of tightness in the Brazilian ethanol markets over the next couple years.

Energy Storage

Quantum Fuel Systems (Nasdaq:QTWW) and Asola have signed an MOU to establish a JV solar-module manufacturing plant in South Korea. The initial module capacity will be 30MW, with potential to generate annual revenues of more than $100 million. Quantum holds a 25% stake in Asola and the companies have entered into a long-term supply agreement with Ersol Solar Energy for the procurement of 155 MW of high-efficiency silicon cells, starting in 2008, as well as supply deals with Sunergy, Motech, and other manufacturers. The partners anticipate that resulting sales from these supply agreements will generate more than $600 million for Asola and Quantum.

Carbon and Clean Tech

Fuel-Tech (Nasdaq:FTEK) announced FUEL CHEM demonstration order from an existing domestic electric utility customer. The demonstration will be performed on a medium-sized boiler transitioning to Powder River Basin (PRB) coal. Chemical injection is scheduled to commence during the fourth quarter.

New Carbon Finance reported that its “Voluntary Carbon Index” (VCI) shows that Verified Emission Reductions (VER) prices increased by 26% on 2007 and 60% on 2006 prices. New Carbon Finance tracked about 3 million tons of carbon credits in July and August worth about $18.9 million at an average of $6.3 per ton.

Energy Management and the Smart Grid

Comverge (Nasdaq:COMV) signed a 15-year contract with Arizona Public Service to provide on-demand, load reduction services that will mitigate APS’ need to acquire up to an additional 125MW of electricity during the summer period. The contract is worth as much as $100 million over the term, with services beginning in 2010.

Google (Nasdaq:GOOG) and General Electric (NYSE:GE) have signed an alliance to develop and promote smart grid technologies capable of providing energy users with real-time information on energy consumption and the ability to automatically turn off devices to conserve energy and reduce bills.

The California Public Utilities Commission approved $1.63 billion for Southern California Edison’s (SCE) smart metering program. SCE will install 5.3 million new “smart” meters for its residential and small-business customers from 2009 until 2012. Note that Echelon (Nasdaq:ELON) has an existing relationship with SCE, and ELON’s stock has been up-ticking all week long on no announced news. Today’s announcement from the CPUC could be setting up a deal announcement from ELON in the coming weeks.

Energy Storage

Active Power (Nasdaq:ACPW) received a multimillion dollar order from a leading Internet search engine provider for 12MW in uninterruptible power supply systems that will protect mission critical IT equipment from power outages. System deliveries are scheduled for Q4, 2008.

MTI Micro, a subsidiary of Mechanical Technology Inc. (Nasdaq:MKTY) demonstrated its 3rd generation Mobion® chip, and its improved power performance by about 25% over the previous generation, producing more than 1800 Watt Hours Per Kilogram of energy from the direct methanol fuel feed.

Notes from Merriman Conference

Both Hydrogenics (Nasdaq:HYGS) and Quantum Fuel Systems (Nasdaq:QTWW) presented this week at Merriman’s conference in San Francisco, and both companies impressed. Hydrogenics is well positioned to benefit from surging electrical demand and rising fossil fuel prices, as well as improvements in fuel cell technologies both in terms of cost efficiencies and performance. Its business economics are improving and the stock should continue to benefit. We first began writing about HYGS on Small Cap Pulse last May, and the stock ran from $0.73 to $2.45 on volume, but has since drifted back to the $0.70 level again. We are bullish at current levels.

And Quantum Fuel Systems, which develops advanced vehicle systems should benefit from consumer adoption in the global PHEV markets, and further electrification of vehicles. Consider this, only 12% of the world’s population currently drives vehicles. With emerging economies coming onto the scene, including China and India, look for that number to increase dramatically, and we think PHEV and flex-fuel adoption will boom. Quantum is an owner of Fisker Automotive (producing the Fisker Karma, amongst other models), which will rival Tesla, as well as electric vehicles that conventional manufacturers will be turning out in coming years, and it is partnered with General Motors, working on the Equinox (GM owns 5% of Quantum); and it is working with Ford on an hydrogen Ford Escape.

Going out of Business

It has been a predictable, but unfortunate series of events leading to this week’s announcement from Electro Energy (Nasdaq:EEEI) that it has exhausted its cash reserves and is suspending operations immediately. 

Geothermal

Contact Energy said it has received final approval to build a 220MW geothermal power plant near Taupo.

Fellows Energy (OTCBB:FLWE) entered into an agreement to acquire Grupo Minero Aconcagua SA, a business which is in advanced stages to acquire rights to geothermal and wind energy projects in central and southern Argentina.

Energy Development Corp (EDC) said it plans 300MW of additional geothermal capacity for the Philippines from 2010 to 2017. The Philippines, which generates 23 percent of its electricity from geothermal energy, is the world’s second biggest producer behind the United States. The Philippines aims to increase its installed geothermal capacity by 2013 by more than 60 percent, to 3,130 megawatts.

Hybrid and PHEV

General Motors unveiled Chevrolet Volt – which it reports to deliver up to 40 miles of gasoline- and emissions-free electric driving, with the extended-range capability of hundreds of additional miles.

Daimler said it is launching its first hybrid passenger car module – the Mercedes Benz S400 BlueHYBRID next summer.

Tesla Motors is locating its headquarters in San Jose, as well as its manufacturing headquarters. The first vehicles will be produced in late 2010. And Zap (OTCBB:ZAAP) said that unaudited sales rose to $737,000 in August, versus $392,000 last year.

In China, State Grid Corporation is reportedly accelerating the construction of charging stations for electric vehicles in Beijing. The Ministry of Science and Technology is going to put 10,000 hybrid, electric and fuel-cell vehicles – and energy supply infrastructure – in operation in about 10 cities around the country by 2010.

Hydropower

Electricite de France is qualifying companies to supply about 50 turbine-generators and other equipment over five years to hydro projects in the EDF system.

Sacramento Municipal Utility District said it is seeking bids for turbine machining services at its 224-MW White Rock powerhouse, part of the 637.257-MW Upper American River hydroelectric project in California.
Solar

China’s Gansu Province has awarded five contracts totaling US$30.78 million for civil works and equipment for the 65-MW Dagushan hydroelectric project on the Heihe River in Gansu.

Peru's Ministerio de Energia y Minas has granted a concession to Energia Azul to perform feasibility studies of the 750-MW Santa Maria hydroelectric project in Peru.

Alstom Hydro has received a 500 million euro (US$708 million) contract to supply electro-mechanical and hydro-mechanical equipment to the 3,150-MW Santo Antonio hydroelectric project on the Madeira River in Brazil. Also in Brazil, Utility Energias do Brasil has completed an asset swap that secures EDB a controlling stake in the 902.5-MW Luis Eduardo Magalhaes hydroelectric project at Lajeado on the Tocantins River in Brazil’s Tocantins State.

Canada Environment Minister John Baird ordered a comprehensive study as the most appropriate type of environmental assessment for the 464-MW Lower Mattagami hydroelectric redevelopment project in Ontario. The plant is scheduled to start commercial operation by mid 2012.

The government of Reunion Island invites applications for pre-qualification to build and equip two small hydropower projects on Reunion Island, a French overseas department off the east coast of Africa.

The government of Colombia has declared of public utility the lands necessary to build the 400-MW El Quimbo hydroelectric project on Colombia's Magdalena River.

Solar

NanoMarkets reported this week that the sales of equipment in the thin film and organic PV market will reach $4.8 billion in 2015, up from $450 million projected for this year, and more than $1 billion next year. And by 2015, the CIGS and OPV sectors are expected to account for 19% of total MW capacity.

Solon Corp., a subsidiary of Solon AG (S001.DE) said it plans to open a 105,000-square-foot factory in Tucson, where it will manufacture PV modules.

Kyocera (NYSE:KYO) is planning to invest $55 billion yen ($527 million) over the next 4 years to double its capacity, and to compete more effectively with Sharp (6753.T), Mitsubishi Electric Corp (6503.T) and Sanyo Electric (6764.T). The investment is expected to get Kyocera to output capacity of 650,000kw by March 2012.

Hoku Scientific (Nasdaq:HOKU) announced a $227 million long-term contract for delivery of additional polysilicon to Tianwei beginning in Q2 2010 through 2020. The contract provides for a deposit of $10 million to Hoku in September, with additional deposits of $12 million in December, $12 million by April 30, 2009, and $2 million upon the first shipment. Including the first contract, Tianwei’s total orders from Hoku are about $511 million. Hoku said it has now secured $306 million in prepayment commitments from its customers, which bring its committed funding to its plant to $353 million (including its own $47 million contribution).

JA Solar (NYSE:JASO) said it doesn’t think that its financial transactions with Lehman will come into play in terms of its 2008 and 2009 outlook and guidance. It reconfirmed full year 2008 guidance with rev in the range of RMB 7.22 billion (US$1.05 billion) to RMB 8.02 billion (US$1.17 billion) and gross margin in excess of 20%, and full year 2009 guidance with revenue in the range of RMB 13.6 billion (US$2.0 billion) to RMB 15.0 billion (US$2.2 billion) and gross margin in excess of 20%."

Suntech (NYSE:STP) broke ground of its new PV cell production facility in Yangzhou, Jiangsu province. The facility is expected to have a PV cell production capacity of 300MW by the end of next year. And Schott Solar announced a multi-year supply contract for more than 5MW of PV modules to AEE Solar.

Solar-Fabrik won a long-term 156mm monocrystalline wafer supply contract from Smart Applications with about $120.7 million. The deal starts in 2009 and runs through 2015.

Solar Monkey and WS Energia are partnering to develop solar tracking systems in the U.S. based on WS Energy’s tracker design which are intended to increase output efficiencies, reliability and lower costs.

Suniva has reached 20+% conversion efficiencies on several screen-printed silicon cells in its lab – verified by the U.S. National Renewable Energy Laboratory.

Spire (Nasdaq:SPIR) announced a contract from GreenBrilliance to provide a turnkey PV module assembly line for its operation in India. The line will be capable of producing up to 12MW of modules per year.

Scaled Solar Inc. announced that it has inked two supply agreements for its high-power concentrating PV (HCPV) systems for end applications power solar farms totaling 75MW in the San Francisco area and in California’s Central valley. More specific details were not released.

A Better Value for Spain? 

Sputnik Engineering AG and Würth Solergy have established the world’s largest area solar electricity unit with modules made of copper-indium-diselinide (CIS) in Albacete Spain. The system consists of 41,600 modules and 100kw centralized inverters generating a total of 3.26MW.

The CIS technology reportedly operates more efficiently at higher temperatures. With an intelligent cooling concept, CIS modules continue to feed their full nominal output to the grid with ambient temperatures up to 45 degrees centigrade. The first long-term trial produced a performance ratio of 82%. So, with tariffs on the decline in Spain, CIS technology may become a more attractive alternative.

Downstream

The city of Berkeley approved a financial plan for loans to homeowners installing solar panels, which could be a roadmap for other U.S. cities to follow. The financing would come through a small increase to property taxes of participating homes, eliminating the need for up-front expenses. So property taxes would be used to repay the solar loan, and would be attached to the home itself, not the owner. In which case, if a home sells prior to the payoff of the loan, the new owner would take over the tax bill – and savings.

The next step for Berkeley is to line up the capital to fund the loans, which could carry a 20-year life and be paid in monthly increments of $180 in additional property taxes. The city’s credit rating is strong enough to enable it to issue municipal bonds to finance the initial cost of the program, but other cities seeking to follow suit may not have strong enough credit ratings to successfully complete bond offerings, so that could be a challenge.

Johnson Controls (NYSE:JCI) selected Solar Integrated Technologies (SIT.L) to supply and install building-integrated (BIPV) roofing systems on three projects worth about $3 million, in Wisconsin, California and Washington. One project will be a 116,000 kWh (annual) BIPV roofing system on JCI’s headquarters.

Solar Integrated also announced a contract from Korowatt to supply 262 KWs of BIPV membrane and metal roofing systems for a warehouse in Kourim, Czech Republic.

Applied Materials (Nasdaq:AMAT) installed two SunPower technology-based facilities totaling 2.1MW. The two systems comprise a 950kW SunPower PowerGuard installation and 1.2MW SunPower Tracker installation.

Premier Power (OTCBB:PPRW) Debuts

Leading downstream solar business, Premier Power, debuted on Monday having completed a reverse merger and financing through Vision Capital last weekend, seeing its stock rise from $4.50 to $5.30, or 17% on one of the ugliest days in Wall Street’s history. The company should benefit as a best-in-class integrator, growing its revenues from $16.7 million last year, to about $48 million contracted this year. Unlike several of its peers, Premier has managed to maintain profitability through this period of growth, and management continues to maintain an emphasis on supporting its bottom line while continuing to expand its revenues. The business, which is focused on the commercial market, has plans to expand further into growth markets in Europe, and continues to execute in an increasingly competitive U.S. market.

Legal

Out of the woodworks, Kaplan Fox & Kilsheimer LLP filed a class action suit against MEMC (NYSE:WFR) and its CEO alleging that the defendants failed to disclose problems at its production facilities that caused production short-falls; as did Federman & Sherwood.

Waste to Energy

The UK government approved a waste-to-energy power station in Cheshire, England. The plant will be constructed by INEOS Chlor Ltd, and it will have a capacity of 100MW.

China Energy Recovery (OTCBB:CGYV) said it expects to hit record backlog in orders for 2008 approaching RMB 115 million (USD $16 million), up 115% Y/Y. CER says that its technology offers substantial cost advantages, where the cost of installation of a 54MW power plant would typically cost about $200 million, its waste-heat recovery system providing comparable power costs about $12 million. Its systems are designed for the China market, but it appears that there could be a licensing scheme forthcoming for the global market.

Covanta (NYSE:CVA) received an Energy Innovator Award from the DOD. It has 35 U.S. facilities that convert more than 16 million tons of municipal solid waste into energy.

Wind

A consortium, consisting of Electric Transmission Texas, LCRA Transmission Services Corp., Oncor Electric Delivery, Sharyland Utilities, South Texas Electric Cooperative and Texas-New Mexico Power Co. is planning to file a $4.93 billion proposal to build a 2,400-mile transmission line in Texas, which would lead to about 18.5GW of new wind power projects.

Babcock & Brown has begun construction of the 79.5MW Majestic Wind Farm, in Texas, which is expected to reach full operation before the end of this year.
Otter Tail (Nasdaq:OTTR) issued in-line guidance for FY08 with EPS forecasted in a range of $1.25 to $1.50.
Gamesa (GTQ1.BE) won an approximately 200 million euro ($290.1 million) contract from Tunisia’s Societe Tunisienne de L’Electricite et du Gas to supply 91 wind turbines with a total capacity of 121MW.
Renewable Energy Systems Americas has signed an agreement with Globalstar to transmit wind measurement  and other remote monitoring data from prospective wind farm locations to their back office using the Globalstar satellite network.
In the Senate, the Committee on Energy and Natural Resources held a hearing to hear testimony on the current state of electric vehicles and the possibility for wider deployment.

BooneWatch

New Mexico Governor Bill Richardson became the first Governor to sign the pledge to join T. Boone Pickens' plan. The natural gas component of the plan is coming under increasing scrutiny and criticism as due to Pickens’ ownership of the largest provider of natural gas for transportation in the U.S., as well as the $160 million JV he and Perseus have to develop a mass-market CNG-powered car.

DOE Watch

The Department of Energy announced the selection of projects for which it will award up to $7.3 million to 14 research teams, with a shared cost value of more than $18 million:
First Topic Area (up to $600,000 for up to 2 years):

• Electric Power Research Institute for fish friendly hydropower turbine development and deployment. 
• Verdant Power, Inc. for improved structure and fabrication of large, high-power kinetic hydropower systems rotors.
• Public Utility District #1 of Snohomish Country – for a Puget Sound Tidal Energy In-Water Testing and Development project.
• PG&E, San Francisco – WaveConnect  Wave Energy In-Water Testing and Development Project.
• Concepts ETI – for development and demonstration of an Ocean Wave Converter (OWC) Power System.
• Lockheed Martin – for an Advanced Composite Thermal Energy Conversion cold water pipe project. 

Second Topic Area, Market Acceleration (up to $500,000):

• Electric Power Research Institute – for a Wave Energy Resource Assessment and GIS Database for the U.S.
• Georgia Tech Research Corp – for the assessment of Energy Production Potential from Tidal Systems in the U.S.
• Re Vision Consulting – for Best Siting Practices for Marine and Hydrokinetic Technologies with Respect to Environmental and Navigational Impacts.
• Pacific Energy Ventures – for Siting Protocol for Marin and Hydrokinetic Energy Projects.
• PCCI – for Marine and Hydrokinetic Renewable Energy Technologies.
• Science Applications International Corporation (SAIC) – for International Standards Development for Marine and Hydrokinetic Renewable Energy.  

Third Topic Area, National Marine Energy Centers (up to $1.25 million for up to five years)

• Oregon State University – for development of Northwest National Marine Renewable Energy Center.
• University of Hawaii – facilitation, development and implementation of commercial wave energy systems and to assist the private sector in moving ocean thermal energy conversion systems beyond proof-of-concept to pre-commercialization, long-term testing. 

Politics

The energy bill has passed the U.S. House, but now it faces more partisan debate in the Senate where Majority Leader Harry Reid (D-Nev) will hold votes on four separate energy bills before the Senate goes to recess next week. Senator John Thune (R-S.D.) said that “The Democrats will run their bill, the Republicans will run our bill, none of them will reach 60, and my guess is that’s where everything stops.” Senator Bingaman’s (D-N.M.) comments were a bit more optimistic about the bill being floated in the Senate

“This compromise will enable us to become a more energy efficient nation and wean us off our dependence on fossil fuels.  It extends the production tax credit by one year for wind energy and by two years for other qualified renewable resources – a category that the bill expands to include marine renewable, such as waves and tides.  I had hoped that we could achieve a longer-term extension of the PTC, but this is all we could afford within the package’s cost constraints.  Undoubtedly, this bill’s extension of the PTC will enable our renewable industries to stay afloat.  But today, I renew my commitment to a long-term extension of the PTC, which I hope we will be able to achieve in the next Congress”

Yesterday, concerning the Renewable Energy and Job Creation Act, a unanimous-consent-time agreement was reached providing that on Tuesday, September 23, 2008, Senate begin consideration of H.R. 6049, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, to provide individual income tax relief, and that the bill be considered under the following limitations: that there be 60 minutes of general debate on the bill, equally divided and controlled between the two Leaders, or their designees; provided further, that the only first-degree amendments in order be the following, with no other amendments in order, they be subject to an affirmative 60-vote threshold, that if D1118 the amendment achieves that threshold, then it be agreed to, that if the amendment does not achieve that threshold, then it be withdrawn, and that each amendment be subject to a debate time limitation of 60 minutes, equally divided and controlled in the usual form: Baucus-Grassley amendment in the nature of a substitute relative to energy tax extenders with offset; Reid or designee perfecting amendment relative to AMT with offset; Baucus-Grassley perfecting amendment relative to tax extenders/AMT without full offset; that it be in order for Senator Conrad to raise a budget point of order against the amendment; and that once the debate time has been used or yielded back, a motion to waive the applicable point of order be considered to have been made; provided further, that if the motion to waive is successful, then the amendment be agreed to, and that if the motion to waive is not successful, the amendment be withdrawn; that Senator Conrad control up to 10 minutes of time during the debate on this amendment; provided further, that regardless of the outcome of the vote with respect to the Baucus-Grassley amendment in the nature of a substitute, that Senate vote on or in relation to the remaining 2 amendments covered in this agreement; that the votes on or in relation to the above-listed amendments occur in the order listed after the use or yielding back of time; that upon disposition of all amendments, the bill be read a third time, and Senate vote on passage of the bill, as amended, if amended; and that the motion to invoke cloture on the motion to proceed to consideration of the bill be withdrawn.

As we get closer to November, Propositions 7 and 10 in California are getting an increasing amount of attention. We have previously discussed the general gist of the propositions, the proposed benefits and the general criticisms, so we will just provide a brief overview once again here:

• Prop. 7, officially called the Solar and Clean Energy Act of 2008 – the legislation would require utilities to generate half their electricity from renewable sources such as wind and solar. The bill is getting widespread opposition – from leading environmental groups, taxpayer advocates and in the renewable-energy industry, arguing that it would shut out small green-energy projects, drive up electricity prices and set back California’s existing alternative energy mandates; and from California’s utilities, which have raised about $24 million to defeat it, saying it would lead to higher utility bills.
• Prop. 10, or the California Renewable Energy and Clean Alternative Fuel Act - would provide rebates of up to $50,000 for the purchase of alternative-fuel vehicles through a $5 billion bond.
  One of the more notable critics of the Pickens-backed Prop 10 is venture capitalist Vinod Khosla who said the plan to boost natural gas vehicles to sever America’s dependence on oil as a “dead end.”

And in Michigan, which has been closely watched as Governor Granholm has been pushing legislation to spur alternative energy uptake, it looks like a bill is going to be passed. The bills call for the state to increase its use of alternative energy to 10% of total power output by 2014.

This week the U.S. Senate Committee on Energy & Natural Resources held a hearing to receive testimony on the current state of vehicles powered by the electric grid and the prospects for wider deployment in the near future. The panel providing testimony included Brian Wynne, President of the Electric Drive Transportation Association, Edward Kjaer, Director of Electric Transportation of Southern California Edison; Robert Wimmer, National Manager of Technical and Regulatory Affairs, Energy and Environmental; Joseph Dalum, VP of DUECO; and Thad Balkman, VP External Relations, Phoenix Motorcars.

Legislation Introduced This Week

S.2156, a bill to authorize and facilitate the improvement of water management by the Bureau of Reclamation, to require the Secretary of the Interior and the Secretary of Energy to increase the acquisition and analysis of water resources for irrigation, hydroelectric power, municipal, and environmental uses, and for other purposes, was on the floor of the Senate again this week.

H.R.6914 , which is a bill to amend the Internal Revenue Code of 1986 to extend certain renewable energy provisions for 10 years, and for other purposes, was introduced.

H.R.6915 , which is a bill to amend the Internal Revenue Code of 1986 to extend the alternative motor vehicle credit for 10 years, and for other purposes, was introduced.

S.3500 , which is a bill to amend the Federal Water Pollution Control Act and the Safe Drinking Water Act to improve water and wastewater infrastructure in the United States, was introduced.

S.RES.663 : which is a resolution expressing concern over the current Federal policy that allows the exportation of toxic electronic waste to developing nations, and expressing the sense of the Senate that the United States should join other developed nations and ban the exportation of toxic electronic waste to developing nations.

S.3506 which is a bill to amend the Internal Revenue Code of 1986 to increase the credit for purchase of vehicles fueled by natural gas or liquefied natural gas and to amend the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users to reauthorize the Clean School Bus Program of the Environmental Protection Agency. NOTE: Sponsor is Barack Obama.

S.3513  which is a bill to direct the Administrator of the Environmental Protection Agency to revise regulations relating to lead-based paint hazards, lead-contaminated dust, and lead-contaminated soil, and for other purposes.

The Senate passed S. 3004, to authorize appropriations for fiscal year 2009 for defense activities of the Department of Energy.

The Senate began consideration of the motion to proceed to consideration of H.R. 6049, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, to provide individual income tax relief.

Upgrades & Downgrades

September 16 – PowerSecure (Nasdaq:POWR) initiated at OUTPERFORM at Northland Securities with an $11 price target.

September 16 – GreenHunter Energy (AMEX:GHR) rated OUTPERFORM at William Blair.

September 16 – Evergreen Solar (Nasdaq:ESLR) rated ABOVE AVERAGE at Caris & Company, with an $8 price target.

September 17 – Evergreen Solar (Nasdaq:ESLR) upgraded to HOLD at Citigroup. Citigroup had rated ESLR a SELL on May 9, with a price target of $8.53.

September 17 – HOKU Scientific (Nasdaq:HOKU) rated a BUY at Broadpoint.

September 17 – Evergreen Solar rated ACCUMULATE at Ardour Capital with $9 stock target.

September 17 – COMVERGE (Nasdaq:COMV) rated OUTPERFORM with price target of $7 by Capital Markets.

September 17 – Verasun (NYSE:VSE) downgraded to PERFORM from OUTPERFORM at Oppenheimer.

September 17 – LDK Solar (NYSE:LDK) rated BUY at Independent International Investment Research, with $72.38 price target.

September 19 – Nova Biosource Fuels (AMEX:NBF) upgraded to ACCUMULATE at Ardour Capital from HOLD with price target of $0.60.

September 19 – Otter Tail (Nasdaq:OTTR) upgraded to NEUTRAL at DA Davidson with price target of $31.

M&A and Financing Activities

Duke Energy (NYSE:DUK) completed its $240 million acquisition of Catamount Energy Corp., which increases Duke’s wind business by about 500MW, to 5,000MW of wind energy under development.

Otter Tail (Nasdaq:OTTR) announced public offering of 5.0 mln common shares.

Thailand's Glow Energy PCL said September 15 its board approved plans to buy a 67.25 percent stake in the 152-MW Houay Ho hydroelectric project in Laos.

Fellows Energy (OTCBB:FLWE) entered into an agreement to acquire Grupo Minero Aconcagua SA, a business which is in advanced stages to acquire rights to geothermal and wind energy projects in central and southern Argentina.

Hydrogenics (Nasdaq:HYGS) filed a preliminary short form base shelf prospectus with certain Canadian securities regulatory authorities, and a corresponding registration statement on Form F-10 with the U.S. Securities and Exchange Commission which will allow Hydrogenics to add flexibility in the future and offer, from time to time, over a 25-month period up to US$50,000,000 of debt, equity or other securities

Integrated Power Services Inc. acquired Trico WCWind Inc., a Litchfield, Minn.-based repairer of wind turbines and generators. GE Capital served as agent for the senior debt financing, with funding provided by KeyBank, CIT and Babson Capital (which also provided the subordinated notes).

PowerGenix Inc.raised $23.5 million in Series D funding. All listed shareholders were existing insiders, including Agenleno Group, Advent International, Granite Ventures, OnPoint Ventures, Element Venture Partners and Technology Partners.

SolarReserve, a developer of utility-scale renewable energy solar power plants, raised $140 million in second-round funding. The deal was co-led by Good Energies and Citi’s Sustainable Development Investments. Other participants included US Renewables Group, PCG Clean Energy & Technology Fund, Nimes Capital and Credit Suisse.

VeraSun Energy (NYSE:VSE) announced a public offering of 20,000,000 shares of common stock, and a grant to its underwriters  (Morgan Stanly and UBS) of a 30-day option to purchase up to an additional 3,000,000 shares to cover overallotments.

Meridian Energy Systems completed an equity round led by Longbranch Capital.

Sapphire Energy Inc. has raised Series B funding that brings its overall funding to over $100 million. Cascade Investment LLC an investment holding company owned by Microsoft Chairman Bill Gates participated on the new round and the Rockefeller family.

Cypress Semiconductor (NYSE:CY) and SunPower (Nasdaq:SPWR) announced a registration of Class B common stock held by Cypress that has been declared effective, and will trade under the symbol “SPWRV”, later reverting to “SPWRB” for “regular way” trading, at which point SunPower will change the trading symbol of its Class A common stock from SPWR to “SPWRA”.

Ormat (NYSE:ORA) filed a universal shelf offering that will enable it to issue various types of securities in one or more offerings up to $1.5 billion.

LDK Solar (NYSE:LDK) filed a preliminary prospectus with the SEC for a follow-on public offering of ADS’s which will bring in up to $150 million to be used for production of its polysilicon plant, with about 30% allocated to capacity expansion of its wafer production facilities and 10% to fund other general corporate activities.

Greenvision ambiente Photo-Solar (GAPS) has sold a 43% stake in its company to Itochu for ¥1.2 billion (U.S. $11.5 million).

Reports and Research

Clean Energy: The Solution to High Gas Prices

The National Defenses Resource Council said that its analysis shows that the oil savings from clean energy measures can far outpace the potential oil production of drilling in America’s protected areas. The real solution to high gas prices and oil dependency is a strategy that relies on energy efficiency, clean fuels, and transportation choices such as commuter rail—not drilling. A comprehensive but achievable clean energy strategy can cut U.S. oil consumption by 9.7 million barrels per day (mbd) by 2030. This is roughly 11 times the amount that we could produce from drilling in the Arctic National Wildlife Refuge and Outer Continental Shelf in the same timeframe.

Energy Future – How America Can Look Within to Achieve Energy Efficiency Security and Reduce Global Warming

The American Physical Society report argues that eliminating wasted energy from automobiles, homes and businesses is equivalent to tapping a hidden energy reserve that will help the United States improve its energy security and reduce global warming

Aspire Clean Tech Sector Performance for the Week Ended September 19, and Year-to-Date

 

The biofuels segment closed down 5% this week, led by a selloff in VeraSun (NYSE:VSE), which fell 69%! The company has retained Morgan Stanley to contemplate strategic alternatives. Metabolix (Nasdaq:MBLX) gapped up on Thursday after the Fed began giving signals it was going to bail out the financial markets to whatever extent it can. The stock ended up 33% on the week. Year to date, the group is down 55%, led by Nova Biosource (AMEX:NBF) which got an upgrade from Adour Capital this morning and a target price of $0.60, a 185% premium to today’s close.

 

 The energy management segment had a terrific week, gaining 20%, with 5 of the 7 in our index closing up more than 20%. Comverge (Nasdaq:COMV) got an upgrade, and we suspect that there could be a deal announced in the next week or so that has been propping up Echelon’s (Nasdaq:ELON) stock – maybe Southern California Edison? The group is down 44% year-to-date, with only Itron (Nasdaq:ITRI) in positive territory. 

 The energy storage group closed up 11% on the week, led by a jump in Mechanical Technology’s (Nasdaq:MKTY), up 49%, after trading all over the place, down as low as $1.12 on Thursday. The stock got a boost on news that the company demonstrated the third generation of its Mobion chip. Year-to-date, the group is up 14$, led by Mechanical Technology (up 125%) and Quantum Fuel Systems (Nasdaq:QTWW), up 125%. We saw Quantum present at Merriman’s conference this week and were impressed.

 

 The geothermal segment was flat this week, Calpine (NYSE:CPN) slipping to year lows, down 12% and Nevada Geothermal (OTCBB: NGLPF) both down double-digits. Ormat (NYSE-ORA) and Raser (NYSE:RZ) both managed to make gains, but it was rocky for both of them. Raser spent the second half of the week explaining itself to investors (the Merrill financing) and calling for an investigation into irregular trading. Year-to-date, the group is down 36%, led by Raser, which is down 62%.

 The upstream solar group closed up 5% on the week, led by Hoku (Nasdaq:HOKU) which continues to close impressive supply agreements with prepayments which will enable it to pay off its plant construction in cash. To date, it has garnered more than $300 million in prepayments. Broadpoint upgraded the stock on Wednesday. Year-to-date, the group is down 29%, led by MEMC (NYSE:WFR) which has been hampered time and again by problems at its production facilities, and now, this week, the legal buzzards are closing in with shareholder lawsuits.

CSP & CPV Finance and Investment summit USA (October 2-3 San Francisco)

www.csptoday.com/usafinance

The world's premier investment and finance event for concentrated solar power.
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Over 150 leading solar executives confirmed to attend including: JP Morgan, HSH Nordbank, Union Bank of California, Ausra, ACORE, Sopogy, Worley Parsons, GE Energy, Solar Reserve, Rockport Capital  

And fantastic speaker line up including:

• The Honorable Bill Lockyer , California State Treasurer, State of California
• Vinod Khosla, Founder & CEO, Khosla Ventures
• Issam Dairanieh, Venturing Team, BP Alternative Energy
• Edward Levin, Vice President, Morgan Stanley
• Geoff Sharples, Business Development, Google
• Asier Aya, Financial Director, Abengoa Solar

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The downstream segment closed down about 1%, led by Open Energy (OTCBB:OEGY) which did a deal with Quercus Trust, which will create some heavy dilution – and overhang – in the stock. The agreement provides for the purchase of warrants to acquire 235,000,000 shares at $0.02 per warrant for a total of $4.2 million in cash, $300,000 of forgiveness on accrued interest on Series B Notes held by Quercus and a $200,000 restructuring fee for the amendment of certain terms of the $3.5 million secured loan previously extended by Quercus. Akeena Solar (Nasdaq:AKNS) closed up 38%, while Premier Power (OTCBB:PPRW) debuted this week, closing up 11%. Year to date, the group is down 44%. This next week will likely be perceived as critical to most of the companies who trade in this group that depend on the ITC to drive their growth. As of today, it is doubtful the Senate will come to an agreement, so we could see downward pressure on the group heading into the vote.

The midstream segment had a good week, closing up 10%, led by Trina (NYSE:TSL), up 35%, and First Solar (Nasdaq:FSLR), which gained 20%. Year to date, the group is down 31%. Energy Conversion Devices (Nasdaq:ENER) is the leader on that basis, up 105%.

 

The solar equipment segment closed up 21% this week, led by Emcore (Nasdaq:EMKR) which rallied 46%, and GT Solar (Nasdaq:SOLR) which also closed up 40%. There wasn’t any significant news out on EMKR, but as we said last week, it looked like the stock was oversold. Year to date, the group is down 12%.

The wind segment closed down 1% this week, led by Otter Tail (Nasdaq:OTTR), which still managed to get an upgrade to NEUTRAL over at DA Davidson. American Superconductor (Nasdaq:AMSC) rallied to close up 31% after getting hammered early on in the week in broader market weakness. The group is down 24% on the year, led by Suzlon (SUZLON.NS), which is down 46% which has had some problems with equipment lately; and Zoltec (Nasdaq:ZOLT) which is down 53%. 

About Aspire Clean Tech Communications, Inc.

Based in San Diego, Aspire Clean Tech Communications is dedicated to providing strategic consulting and communications services to businesses operating in the alternative energy and clean tech industries. Our commentary and outlook on the public markets and the alternative energy can be found on a daily basis at www.smallcappulse.com.

For more information about Aspire Clean Tech Communications, Inc., contact Todd M. Pitcher at 858-518-1387.

This Aspire Week in Review was sponsored by Comanche Clean Energy, Inc., a leading Brazilian ethanol and biofuel firm bringing the lowest cost and most efficient alternative energy solutions to the world, and Hayden Communications, Inc., Wall Street's leading corporate communications firm. For more information about Hayden Communications, call 646-536-7331, for more information about Comanche Clean Energy; contact Todd M. Pitcher at 858-518-1387.

The Aspire Week in Review is brought to you by Small Cap Pulse the best source on the web for financial and economic commentary, stock recommendations, and a fresh idea. To learn more about Small Cap Pulse, call 858-509-9900.

 

 

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