Wind Energy - Green Chip Stocks

Chinese Wind Turbine Manufacturers

Chinese wind turbine manufacturers have been on a tear lately.

Just last month, Xinjiang Goldwind (the second largest Chinese wind turbine producer) announced that it had landed 13 North American wind power contracts. Then a week later, the company announced it's 14^th – the acquisition of two 10 megawatt windfarms in Shawmut, Montana.

And this morning we learned that China Ming Yang Wind Power Group (NYSE:MY) just landed a deal to supply turbines and build two wind parks for Bulgarian wind energy developer W. Power Ltd.

Now last year was the first year China's own wind development slowed. This, after a doubling every year from 2005 to 2010. Although wind energy integration will continue in the Middle Kingdom, Chinese wind turbine manufacturers are quickly expanding into other markets. It is likely that we will see even more wind turbine deals in Europe and the U.S. throughout 2012.

As for the new Bulgarian project, that will be operational by the end of this year.

A Shift in the Global Wind Industry

This year will be the first since 2004 that the United States' wind industry won't surpass its previous year's growth.

And every report I read about the industry seems to be filled with buts, whiles, yets, and howevers...

Last year was a record-breaking year, with about 9.8 gigawatts installed. But the industry is in for a 40 to 60% drop this year, with analysts expecting anywhere from 6.3 GW to 7.1 GW to be installed...

While the U.S. has expansive coastal wind resources, offshore is expected to account for only 5% of installations by 2025...

Texas, Minnesota, and California have long been wind hot spots, yet transmission congestion, lackluster utility demand, and cheap natural gas have led to a significant reduction in the amount of power purchase agreements signed...

There has actually been unprecedented levels of federal support for wind energy. However, without a federal renewable portfolio standard (RPS) and streamlined transmission and siting processes, the time for projects to become operational will be greatly delayed...

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A Shift of Global Winds

I know that sugarcoating bad news helps soften the blow, but when you're staring at a potential 60% one-year drop in wind installations — immediately following a year of record growth — there's no room for coddling.

Alarm bells should be going off:

That's a one-year chart of some of the biggest pure wind plays on the market, along with the First Trust Global Wind Energy ETF (NYSE: FAN) — all are down 20% to 50% for the period. Others that operate solely in the U.S., like Broadwind Energy (NASDAQ: BWEN), are down even more.

So let's not ignore the problems...

Financing is still tight because of the recession. Electricity demand is down because of the recession. Natural gas has been insanely cheap. Readily available sites with the best wind speeds next to transmission are nearly exhausted.

And as a result, the industry is now facing an oversupply of wind turbines. Related stocks have been punished accordingly.

It's been a tough turn-around for what was once the most dominant cleantech industry. And it's forcing some much-needed changes.

Adapt or Die

According to Bloomberg New Energy Finance: “To compete in the era of low-priced natural gas, the levelised cost of wind generation must drop substantially on a MWh basis. This means the industry cannot sit on its laurels but must re-dedicate itself to technological innovation.”

The energy world is evolving. And it's time to adapt or die.

As such, the big boys have gone back to the drawing board.

Siemens is now producing a 3.6 MW direct-drive turbine that has no need for gears...

Vestas has two new models that can capture lower wind speeds with larger rotors...

And GE (NYSE: GE), known for its 1.5 MW onshore turbine, is now taking orders for its new 4 MW offshore model, the first of which will go to Lake Erie.

Again, I'm not going to sugarcoat or dismiss the challenges facing the industry.

As Bloomberg put it, “The big players are seeking ways to improve turbine performance so the devices perform better and more consistently at lower wind speeds. This is in part recognition that the lowest hanging fruit is now gone with most of the windiest spots developed. Class 3 winds are what is left to develop and the industry must adapt to that reality.”

So investing is going to be tricky.

The companies in the chart above are at or close to their 52-week lows; and it's difficult to pinpoint any major positive catalysts in the near future.

If you're looking for a discounted wind buy, I'd stick to the Asian players or the larger conglomerates that won't be as adversely affected should the industry continue to stall.

Remember, China is now the largest onshore wind market in the world. And a plan to add 30 GW of offshore capacity by 2020 would put them ahead of the UK's ambitious 25 GW by 2020 target.

Not only that, but reports coming out of the recent American Wind Energy Association conference in Dallas show that Chinese and South Korean companies drew the largest crowds at breakout sessions and in the exhibit hall.

There will be ways to profit from this industry (A-Power (NASDAQ: APWR) and China Wind Systems (NASDAQ: CWS) come to mind)...

It'll just require more research and precision than before.

Call it like you see it,

Nick

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Offshore Wind Energy in the U.K.

Last Monday, I wrote to you about the UK's new “green” government.

With Conservative David Cameron at the helm, the UK is now going full force on clean energy integration, focusing heavily on offshore wind development.

Well, two days after that e-mail, we got a hold of a new study that could add even more validation to the potential of offshore wind production in the UK...

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According to the latest industry economic valuation report, the UK's offshore renewable energy industry could generate the same amount of electricity — per year — by 2050 as one billion barrels of oil. And it could do it using less than one-third of the available space.

By utilizing less than 30 percent of the UK's practical wind, wave, and tidal resources, our friends across the pond could actually match the electricity generated by North Sea oil and gas production.

The report also noted that harnessing the full potential of offshore renewables could generate enough for the UK to power itself more than six times its current demand, thereby making it a potential energy exporter.

This is huge.

Today, most of the UK's renewable capacity comes from fixed wind turbines. But the study did predict that floating wind turbines would eventually have the most power generating potential.

A Very Profitable Flotation Device

We first told you about floating wind turbines last year, after it was reported that Siemens (NYSE: SI) had teamed up with Norwegian oil and gas player StatoilHydro (NYSE: STO) to build the first floating wind turbine for deepwater use.

The initial application for that particular turbine was to help power oil and gas rigs that sit above the North Sea's diminishing reserves. But since no seabed foundation construction is necessary with floating turbines, these things could ultimately have a significant economic advantage for offshore wind power developers.

And since floating turbines can be situated further from the shore — where the wind resource is stronger and more consistent in many cases — more undersea cable would be necessary. This would create a real benefit for companies like ABB (NYSE: ABB) and General Cable (NYSE: BGC).

Now while the concept for large-scale offshore floating wind turbines was actually introduced in the U.S. back in 1972, it looks like Europe is once again taking the lead on a potentially disruptive power technology.

The first fully deployed floating wind turbine was in Italy. A company called Blue H Technologies operated the prototype in 2007 and conducted extensive testing for about a year.

Principle Power, Inc. signed an MOU with Energias de Portugal (ELI: EDPAE) (EDPFY.PK) last year to develop a deep water offshore wind project in Portugal that would use the WindFloat technology. This is a patent pending floating foundation that was developed by Marine Innovation & Technologies, which is owned by Principle Power.

The project will take place in three phases, resulting in a 150 MW commercial floating wind farm.

And of course, in the UK, floating turbines are now gaining serious interest from the new coalition government which is quite bullish on offshore wind development — whether utilizing new or conventional technologies.

Although it should be noted that last week, the UK Treasury did ask for a full review of every spending approval and pilot project from the previous Labour government (only from January 1). This could include a $86.3 million competition fund for offshore wind port infrastructure.

That fund actually had a lot to do with General Electric (NYSE: GE) and Siemens setting up shop in the UK. So it will be interesting to see how this plays out.

I suspect that job creation and tax dollars will trump any argument for terminating that fund. But certainly as investors, we can't ignore these things.

In the meantime, we will continue to watch the evolution of floating turbines, new offshore turbine manufacturing deals, and even the developers operating in the UK.

One in particular that could certainly benefit from aggressive offshore wind development is SeaEnergy PLC (AIM: SEA) (SEYXF.PK). This particular company has interests in three UK offshore wind sites, and has also made some headway in Taiwan.

The company was formerly known as Ramco Energy; since the company's Board decided to start moving away from its oil & gas investments and focus primarily on offshore wind, SeaEnergy was born.

That's right, move AWAY from oil & gas investments.

I love it!

To a new way of life, and a new generation of wealth...

Jeff

Profit from the UK's New Green Government

The new UK Prime Minister, Conservative David Cameron, has wasted no time in rattling the clean energy cage, saying:

I don't want to hear warm words about the environment. I want to see real action. I want this to be the greenest government ever... I intend to make decisions put off for too long to fundamentally change how we supply and use energy in Britain... To give the power industry the confidence it needs to invest in low carbon energy projects.

As a Green Chip investor, you have to love it!

Especially since those words came just days after the new coalition government reached an agreement on a new low carbon and "eco-friendly" economy.

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Take a look at what this thing includes:

The establishment of a smart grid and the roll-out of smart meters
The full establishment of feed-in tariff systems in electricity
Measures to promote a huge increase in energy from waste through anaerobic digestion
The creation of a green investment bank
Measures to encourage marine energy
The establishment of a high-speed rail network
The cancellation of the third runway at Heathrow
The provision of a floor price for carbon
Measures to promote green spaces and wildlife corridors in order to halt the loss of habitats and restore biodiversity
Mandating a national recharging network for electric and plug-in hybrid vehicles
Seek to increase the target for energy from renewable sources

Bottom line: This new government across the pond is going full force on clean energy — and we're going to profit from this every step of the way...

Making Your Money Offshore

The UK's new energy transition will smoke out a ton of opportunities in the coming months and years. But the first round will likely focus on those clean energy options that are already underway, like wind energy development.

According to RenewableUK (formerly the British Wind Energy Association), the UK currently has 262 operational wind projects providing more than 4.5 gigawatts — enough to power the equivalent of 2.53 million homes.

But the big growth opportunity for wind in the UK is offshore wind.

Last month, offshore generation capacity hit 1 gigawatt after a new project by Dong Energy and E.ON (F:EOAN) (EONGY.PK) started producing power. This elevated the UK as the leading nation for installed offshore wind power.

In January, the government awarded licenses for 32 gigawatts of projects — yes, 32 gigawatts! Statoil ASA (NYSE:STO), RWE AG (RWEOY.PK), and Centrica Plc (CPYYY.PK) are just a few that landed some of those licenses.

Meanwhile, wind mainstays like Siemens AG (NYSE: SI), Vestas Wind Systems (VWS: CO) (VWDRY.PK), Gamesa (MCE: GAM) (GCTAF.PK), and General Electric (NYSE: GE) continue to expand their presence. GE actually announced a couple of months ago that it now plans to build a new offshore wind turbine manufacturing facility in Britain.

The UK believes offshore wind can provide 25 percent of the country's electricity demand by 2020.

This is a huge undertaking for our friends across the pond, and certainly a massive opportunity for those who invest in the companies that will facilitate these massive offshore wind projects.

Next week, I'll give you further details on the companies that are likely to make you and I the most money from offshore wind in the UK. But until then, let's take a look at...

An Opportunity You Can Jump on Right Now

While both parties of the UK coalition government have agreed to transition to a low-carbon economy, a strong division still remains over nuclear.

The Liberal Democrats are opposed to the construction of new nuclear plants, while the Conservative Party supports an entirely new fleet of nuclear power plants — so long as it does not include any public subsidies. It's that particular condition that will make any future nuclear integration difficult; at least, compared to what we were seeing with the previous government, which was heavily focused on nuclear.

Of course, here in the United States, it is highly unlikely that nuclear will not be an integral part of our new energy transition.

Let's face it: Its presence in the energy bill is all but guaranteed. And that's why my colleague, Nick Hodge, has been so aggressive in finding early nuclear plays for Green Chip Stocks readers.

In fact, just last week, Nick alerted us to a company that's about to blow the lid off the nuclear energy renaissance in America. That stock is now up more than 268%. And thanks to the broader market being down today, there's now another chance to get back in below Nick's initial buy limit.

You can get the full details here.

To a new way of life, and a new generation of wealth...

Jeff

Top American Wind Energy Companies

Growing up in Essex, Maryland — a very blue collar section of Baltimore County — the phrase "Buy American" was more than just a rallying cry for those who championed domestic manufacturing.

It was simply how things were done.

Even when the oil crisis of the 1970s hit, you would've been hard-pressed to find a single vehicle on our block that didn't scream Detroit — regardless of how horrible the fuel economy was on most of those vehicles back then. And for the few who dared to park a smaller, more fuel efficient Japanese car on our street... well, they were nearly shunned.

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This was an old U.S. industrial town, with generations upon generations of factory workers raising families and doing the kind of work that most folks couldn't do for an hour before calling it quits. Buying American was not just something you would say; it was something you had to embrace. Because for these folks, buying American meant job security.

Of course, decades have passed since then. Today, that old street in Essex is lined with Toyotas, Fords, Hondas, and Nissans. And quite a few of those old factories have been leveled or turned into fancy apartment buildings. Yet the cry to buy American has never gone silent.

In fact, this past weekend I was talking to an old friend who still lives in Essex. He still drives his American car (although it was actually manufactured in Mexico); he reads Green Chip Stocks daily, as he's a huge advocate of clean energy integration; and he absolutely loves to criticize me for not providing enough coverage on domestic wind energy plays.

But as I constantly remind him, Green Chip readers simply want to know where the money is...

If it's a domestic opportunity, then that's fantastic. But we're sure as hell not going to ignore an opportunity to make money just because a particular company is not based in the U.S.

Besides, most of the strongest domestic wind energy plays are not pure wind plays, anyway.

Although I suppose that doesn't make them any less worthwhile.

So, in an effort to please my old friend — and any other readers who share his views on domestic wind energy — here are a few domestic wind energy companies that are not pure plays... but that do play a significant role in domestic wind energy expansion.

FPL Group (NYSE: FPL)

Through its NextEra Energy Resources subsidiary, FPL is the largest owner of wind farms in the United States.

According to the American Wind Energy Association, with more than 7,500 megawatts of installed capacity, NextEra provides enough electricity for nearly 2 million households. A decade ago, they boasted less than 500 megawatts.

Today, NextEra has about 9,000 wind turbines at 75 wind farms in 17 states and Canada.

General Electric (NYSE: GE)

General Electric ranks number one in U.S. wind turbine sales and is actually one of the largest suppliers of wind turbines in the world, boasting more than 11,600 wind turbine installations that comprise more than 18,000 megawatts of capacity.

The company also just announced that it plans to introduce a 4 MW, gearless wind turbine for offshore use. This is expected to be ready in 2012 and will put GE in direct competition with German wind energy powerhouse, Siemens AG.

There are also a few domestic companies that manufacture wind towers, like Trinity Industries (NYSE: TRN), Ameron International Corporation (NYSE: AMN), and Otter Tail Corporation (NASDAQ: OTTR).

And of course you have companies like:

Owens Corning (NYSE: OC) - Manufacturing composites for blades and poles
MasTec (NYSE: MTZ) - A specialty contractor
Thomas & Betts (NYSE :TNB) - Providing support structures and electronic components
American Superconductor (NASDAQ: AMSC)- Providing engineering and control and monitoring systems
Broadwind Energy (NASDAQ: BWEN) - Manufacturing components, towers, and transportation services

Who Benefits?

Like my old friend, I'm all for supporting domestic clean energy companies. But that doesn't mean we should turn a blind eye to those foreign clean energy companies that are employing U.S. citizens.

A few of these include:

Gamesa (MCE :GAM)
Siemens (NYSE: SI)
Vestas (CO: VWS)

While these may not be U.S. companies, they put a hell of a lot of our people to work.

And I don't know a single person working in manufacturing who's about to turn down a good-paying job because the folks who own the company don't hold U.S. passports.

Besides, we've had so many opportunities to build out our clean energy economy in the past... And we chose to ignore those opportunities because politics and special interests stood in the way.

This allowed more forward-thinking capitalists in other parts of the world to simply step in and pick up the slack.

Of course, there's still time for us to get our act together...

With aggressive and responsible clean energy policy in place, we can turn this around. We can take the lead in clean energy development. We can strengthen our economy, put more Americans back to work, and provide a cleaner, safer environment for future generations.

But rest assured, if we don't do it, someone else will.

To a new way of life, and a new generation of wealth...

Jeff

Investments in the Clean Energy Sector

Moods start changing around this time every year.

Maybe it's the increase in temperature and sunshine... Maybe it's the sight of green shoots springing up from barren ground...

If you're a cleantech investor, perhaps the release of 2009 investment and installation data has something to do with your improving sentiment. I know it does mine.

Every year around this time, reports abound about the previous year's activity.

Who invested how much and where? Which countries installed the most wind power? Solar power? So on and so forth...

One of the best such reports — called Clean Energy Trends 2010 — comes from my contemporaries at Clean Edge.

Its release is highly anticipated every year, and I thought I'd pass along some of this year's findings. We'll also see how these clean energy trends translate into real market profits.

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Cleantech by the Numbers

Up front we learn that the public market thawed only slightly more in 2009 than in 2008. We witnessed 13 initial public offerings (IPOs) last year, as opposed to six the year before.

And as we've told you in these pages, global governments turned to cleantech growth as a means for economic revival during the recession. A healthy economy thrives on cheap energy.

The United States committed $100 billion of its massive stimulus to fostering cleantech growth. South Korea quietly pledged $84 billion.

But China has not-so-quietly taken the lead by far, and could spend as much as $660 billion over the next ten years making sure it emerges a dominant clean energy economy.

Government support like that coupled with a law requiring utilities to buy all future installed renewable energy capacity — wind, solar, all of it — will make China a hotbed of investor profits for years to come. (For more on that, check out my article today in our sister publication, Wealth Daily.)

Even as the global economy continued to fight off recession, the three major clean energy sectors — wind, solar, and biofuels — were able to grow their combined revenue 11.4% over the previous year.

The combined revenue of those three sectors was $139.1 billion. The report forecasts growth to $325.9 billion in the next decade. A picture illustrates this growth more clearly:

That means this already multi-billion-dollar industry will grow 134% in the next ten years. You know of any other industries doing that?

Let's say oil production grows to 100 million barrels per day by then (which it probably won't) up from 85 million per day today. That's only 15% growth.

The energy industry growing the fastest, therefore creating the most wealth, is clean energy.

Biofuel Trends

The biofuel market — both ethanol and biodiesel — brought in $44.9 billion in 2009.

Globally, production of those fuels reached 23.6 billion gallons.

There are two things to be said about biofuel...

First, it should cost the same or less than its fossil equivalent.

Second, we use 1.303 trillion gallons of oil each year, so 23.6 billion gallons is enough to supply the world's liquid fuel needs for only seven (7!) days.

The second won't change until the first does.

But the companies that can make it happen — that can produce competitively-priced biofuel — have a 1.279 trillion gallon gap to fill. And each of those gallons is worth at least $1.00. I know gas in my neighborhood is selling for $2.78/gallon. You do the math.

That's a $2 trillion biofuel market up for grabs annually. And investors are already rewarding the winners accordingly:

And we're still making this stuff with corn, soy, and sugarcane. Just wait until enzymatic and cellulosic companies hit the market, making it with wood and algae.

Wind Trends

Wind revenue in 2009 grew to $63.5 billion on the back of 37,500 installed megawatts; 13,000 of those megawatts — more than two thirds — were installed in China.

By 2019, Clean Edge is forecasting a $114.9 billion wind market — only slightly larger than the biofuel market at that time.

With a third of the installations going to China, wind companies operating there did best in the market, while European stalwarts continued to stutter.

All of a sudden, companies like China Wind Systems (NASDAQ: CWS), A-Power Generation Systems (NASDAQ: APWR), and American Superconductor (NASDAQ: AMSC) are blowing away the old go-tos like Vestas (COP: VWS), Gamesa (MCE: GAM), and Nordex (XETRA: NDX1).

It's all about being in the hot market... And they simply weren't in China to the extent they should have been.

I look for a rebound in those big turbine suppliers and the U.S and European markets continue to chug along. And I also look for installers operating in hot markets to do well.

Solar Trends

Solar revenue came in at $30.7 billion for the year.

This is the first year since 2000 that annual solar revenues have fallen. But that's a better long-term indicator than it is a short-term problem.

The solar industry is coming of age. And, as in all industries, prices fall when that happens. Economies of scale are created, and so on.

So while solar installations were actually up in 2009, revenue fell just a bit. Solar is still forecast to be the biggest grower of the three, with a 222% increase in annual revenue to $98.9 billion by 2019.

As more panels continue to be installed and prices continue to fall, the companies producing at the lowest cost will make the most money. Margin is the name of the game at this point.

We've already seen Chinese companies undercut their European and North American competitors, with many setting up sales and production offices on U.S. shores.

The Chinese now account for 50% of all solar sales. I don't see this trend abating anytime soon. You can see how investors have reacted, with First Solar (NASDAQ: FSLR) and one-time world leader Q-Cells (XETRA: QCE) both losing value over the past year:

I'm long Chinese solar for at least the next few years. In fact, I'm long the entire Chinese cleantech market for the next few years.

So that's the nutshell for 2009. We'll continue talking about these trends and numbers in our ongoing effort to help you better understand and profit from the green market.

In our premium services, members are constantly learning how to profit from these trends in real time, by buying the best companies in these sectors based on our research.

Call it like you see it,

Nick

Birth of the Supergrid

I traveled to Britain in the spring of 2006 to see first-hand what I had been reading in the BBC — that Scotland was becoming a pivotal part of a worldwide energy economy in transition from fossil fuels to clean power.

I took the train early one morning from charming old Edinburgh to Burntisland, a drab manufacturing town of about 5,000 just over an hour's ride across the Firth of Forth. Burntisland was and is one of several North Sea oil and gas towns being revitalized by wind power projects that put industrial workers back on the job.

Despite the driving rain and a bird flu scare just up the road near golf holy site St. Andrews, I arrived to join a roomful of Scottish engineers to learn about an offshore wind farm demonstration project being spearheaded by Canadian company Talisman Energy (NYSE: TLM).

We headed by bus to a manufacturing facility in nearby Methil, where I watched workmen weld gigantic steel structural jackets inside an airplane hangar. That was an industrial operation unlike any I had ever seen.

All the bright-yellow pylons around me that day were soon moved by barge to a site 25 kilometers off the coast in the North Sea and then hoisted into place with a special crane; the two 5-megawatt turbines that crowned the structures I saw have now been powering the adjacent Beatrice oil field drilling platform since 2007.

This image of clean energy giving wattage to a fossil fuel operation as it taps a declining undersea oil resource perfectly exemplifies the transitional energy economy we are investing in.

Beatrice is a true pivot point between the old energy order and the new.

Building on that progress, a 34 billion euro (US$46 billion) European power connection project with a decidedly green bent is now taking shape among North Sea nations. We can expect to see large offshore wind farms become commonplace in the next decade as this "Supergrid" expands.

Investing in the Supergrid

This Supergrid already involves nine countries: Germany; France; Belgium; the Netherlands; Luxembourg; Denmark; Ireland; and the United Kingdom.

Those European Union member states are now being joined by a group of boosters from the business world. On Monday, March 8, the "Friends of the Supergrid" announced their support and hope for the EU to build a power infrastructure system that can completely wean the continental economy off of fossil fuel power by 2050.

These power pals are kicking off their partnership with momentum from national governments and the EU, as well as the electricity industry they represent.

Friends of the Supergrid is currently made up of ten charter companies:

Siemens (Germany); Areva (France); Visser & Smit Marine Contracting (Netherlands); DEME Blue Energy (Belgium); Mainstream Renewable Power (Ireland); Hochtief Construction (Germany), 3E (Belgium); Parsons Brinckerhoff (USA, EU-wide); Elia (Belgium); Prysmian Cables & Systems (Italy).

Of those ten, five are already available to international investors who want to play the Supergrid:

Siemens (NYSE: SI); Prysmian (Pink Sheets: PRYMY); Elia System Operator (Brussels: ELI); Hochtief (Xetra: HOT); and Areva (Pink Sheets: ARVCY).

This will — at the very least — be the foundation for a major offshore wind energy rollout in the EU. Even for Desertec, the German-led plan to link new North African renewable energy capacity with Europe, what goes on between the British Isles and their North Sea neighbors is of great importance, because it means clean power linkups have grown to continent-scale.

The Supergrid is also good news for hydropower generators, especially in Norway.

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Norway: The Saudi Arabia of the North Sea Supergrid?

In the global oil game, the Kingdom of Saudi Arabia has traditionally been the go-to producer when other OPEC members slash output. That role has earned Saudi Arabia the title of "swing producer."

With the need to balance intermittent wind energy contributions to the Supergrid, Norwegian energy companies may step in to make Scandinavia's western branch the swing producer of northern Europe.

Bård Mikkelsen, the CEO of state-owned renewable energy company Statkraft, told the Financial Times this week that hydro power in his country "should be valuable for compensating for the irregularity of wind power."

"That position — being a swing producer to the European market — is a very important role for us," Mikkelsen affirmed.

Statkraft has been busy both managing existing hydropower facilities in Norway and developing new methods of getting power from water. One example of Statkraft's state-of-the-art hydropower is its power plant at Tofte, where water filtration through osmosis has been kicking out wattage since late 2009. The project is set for commercial generation by 2015.

Oslo policymakers and Statkraft engineers hope to ramp up osmotic hydropower to 1600 TWh (terawatt-hours) per year. That's 13 times Norway's current annual hydropower output!

Each cog in the Supergrid wheel will have to move well for the entire network to grow to maturity. The UK alone wants 50 GW of offshore wind power capacity by 2020 — up from about 2 GW across the entire EU today. 100 GW of offshore wind projects are at varying stages of planning and development right now across the continent, but all the countries and companies I've mentioned here have to share technology to optimize that new capacity.

Offshore wind energy will tie in with onshore wind, hydro, solar, and nuclear power to give Europe a balanced distribution network. Transmission is a huge factor, too — Mainstream Renewable Power CEO Eddie O'Connor, speaking for Friends of the Supergrid, says there is as much as a 20 euro difference in the price of offshore wind per megawatt hour when optimal grid linkup scenarios are put up against connections through less robust cable connections.

The cooperation of companies that make up Friends of the Supergrid today should minimize transmission loss as the project unfolds, and the group is set to double in size to twenty members soon.

Some pieces of the Supergrid puzzle are still missing, like turbine manufacturers and even electric vehicle technology that can provide storage for wind power on the grid. So companies will be added... and I'll be on the lookout for which ones are best to maximize your profits.

Regards,

Sam Hopkins

Peru Wind Energy Projects

An armada of Spanish investors is riding a stiff breeze across the Atlantic to their former Latin American colonies.

Among them, two wind power companies are set to profit big time from a clean energy reconquista.

Let me explain...

This past week, I've been privy to Peru's national renewable energy auction process, which aims to bring clean power production in this leading Latin American economy up to the needs of GDP growth and a growing population. On Monday, bids in closed envelopes were delivered to the Ministry of Energy and Mines for the first major round of clean power pricing.

And I have a good handle on who the winners will be...

Just a few days before, I met with Juan Coronado, head of one of the bidders, Energia Eolica (which means "wind energy" in Spanish). Señor Coronado echoed lessons I learned in Brazil in 2009 about the need to alternate between abundant but seasonal hydropower resources and sizable breeze-blown power potential.

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From 2006 to 2008, Peru averaged 8.8% economic growth each year, and similar levels of expansion are going to be needed to give jobs to the 370,000 people who enter the workforce annually.

The stakes are high, as my other local contacts here reinforce with stark statistics. Cesar Peñaranda, Executive Director of the Institute for the Economy and Business Development at the Lima Chamber of Commerce, told me this Tuesday that 85% of Peruvians in areas with little or no infrastructure are poor.

That means that roads, water, and above all, energy, are hard to come by for large sections of this strategically important country between China and Brazil. As a result, the denizens of those underserved slums and shantytowns are scarcely involved in the economy except to sell inflatable toys and bubblegum-flavored Inca Cola to the middle and upper class as they escape to the beach each weekend.

When the global economy turns down, as it has in the past year, the lower classes get knocked two steps back for every one step forward they took during boom times.

Even if commodity prices of Peru's natural resources like gold, silver, natural gas, and rice are on the rise, the government needs to initiate and attract a lot more investment in infrastructure to achieve first world status — which President Alan Garcia hopes to do by 2021.

This is where this week's clean energy auction comes in, and where you'll see why Spain is leading the charge.

Spain's Clean Power Pole Position in Latin America

Spain has become the top source of foreign direct investment (FDI) in Peru, as major Madrid companies like petroleum giant Repsol YPF (NYSE: REP) seek dynamic new markets.

Historical and cultural ties make Latin America an easy choice for expansion beyond Europe, and in the current clean energy bidding in Peru, Spanish clean energy companies are — as my fellow Green Chip International editor Nick Hodge likes to say — in the catbird seat.

In fact, GCI readers already know about two Spanish companies that are sure to be among the winners when Peru names its clean energy champions on February 12.

Lima is celebrating 475 years as a city this week. Founded by the Spaniards as the City of Kings, Lima is now a capital in its own right.

Spain still has plenty to teach Peru about kick-starting a native clean energy industry. At the end of 2009, Spain reached a record 42% of its electricity capacity from wind power; the problem now is storage. Incidentally, Spanish leaders started chirping this week about a big national electric vehicle push, and we're hearing more and more from energy aficionados around the world that EV batteries could themselves become a widespread storage mechanism for the smart grid. More on that another time...

In Peru, Spain's top wind power firms can help ramp up generation right now.

But as forcefully as Spain is moving into this market, they're not alone...

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Why Peru is Our Global Green Stock Bellwether, and How to Benefit

The United Nations Conference on Trade and Development says that Peru was unique among emerging markets in bringing FDI up in 2009. Peru's foreign investment inflows grew by 28.1%, while mighty Brazil's gravy train delivered only half of its 2008 load last year.

Not only Spain but neighboring Chile, the United States, and of course China are pouring money into Peru.

What this means, quite simply, is that Peru is establishing its own momentum as a target for global companies to establish themselves and tap growth that has already proven to reach China and India levels.

As I said above, Peru can't just bank on commodities to keep FDI and GDP flowing, so the country is searching for sustainable means of growth.

For our purposes, the best approach is stocking up on shares in the Spanish companies that are already the leading investors in Peru's highly attractive investment scene.

But not just any Spanish company will do... which is why I've traveled both to Spain and to Latin America to investigate precisely which firms have the best approach, and which will pay off biggest in the end.

And I've prepared a video report from right here in Lima for Green Chip International subscribers. I'll be updating them on exactly how our portfolio will be affected when the February 12 announcement of winners in the Peruvian clean energy auction comes around.

These stocks aren't only attractive as long-term plays on international clean energy advancements — they're also trading at a discount right now, which means there's never been a better time to buy. Come what may in the market, Nick and I expect upwards of 60% returns in these two companies over the next several months.

And Peru isn't the end of the story. Other countries on this continent and elsewhere are engaged in similar auction rounds to draw money and create energy for growth, and the same companies we're talking about have a truly international edge.

To learn more, check out GCI today and get the global advantage so many investors already enjoy.

Saludos,

Sam Hopkins

The Renewable Energy Landscape in Peru

I came here to Lima, fresh from a nasty cold snap on the East Coast.

I'm here reporting on what's happening in the renewable energy industry, including several meetings with wind energy companies this week.

My local contacts already tell me that one of our top European clean power plays in the Green Chip International portfolio is heavily involved here in Peru with the development of different regional renewable energy initiatives.

The story of how Peru got to be an investment hot spot in early 2010 is what I want to tell you today.

Now I'm sitting in a cafe in Lima, writing to you in English via wireless internet while I read the newspaper in Spanish. Outside I see the freshly paved, grass-lined streets of a city many foreigners had given up on just a few years ago.

In the 90s and 00s, Peru endured earthquakes and terrible political scandals. Both rocked investor confidence and kept many locals feeling isolated from and inferior to the rest of the world. Now international banks like HSBC and energy companies such as Brazil's Petrobras are clamoring to establish themselves in Peru, where they hope to tap economic growth that is expected to lead Latin America in 2010.

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Economic Growth to Lead Latin America in 2010

In 2008, Peru's gross domestic product grew by a sizzling 9.8%. That cooled in 2009 — but only moderately, since Peruvian financiers steered clear of the derivatives that drove the credit crisis and rich-country recession. In 2010, U.S. investment bank BCP Securities expects 5.7% growth, with government finances improving and the financial system not showing any deep cuts of the global credit crisis (other than the impact on some poor souls who invested with American fraudster Bernard Madoff).

Our GCI European wind power firm is angling toward well over a gigawatt in installed wind power capacity, from Lima to far-flung poorer areas in the Andes.

Interestingly, the experience I've had talking to national leaders and businessmen in Brazil about that country's renewable energy rollout and recent wind power auction will inform my research here in Peru. Peru is right on the border with Brazil, and as I wrote this week in Wealth Daily, this country is becoming a conduit between China across the Pacific and Brazil just to the east.

Peru, like Brazil, has both extensive river-based energy potential and strong winds that can compliment each other. I hear that the government of President Alan Garcia has mixed feelings about clean energy because of his efforts to make Peru a natural gas hotbed, but the World Bank and other international organizations are pushing for Peru to keep the natural beauty and ecosystems of its Amazon and Andes healthy, so clean energy is a must for economic development that safeguards the country's ecological endowment.

The natural views and experiences of Peru at sites like Machu Picchu are, after all, the reason that millions of tourist dollars pour into this country every year.

As a case in point, Lima is just now drying out from a week's worth of rain that totaled as much as the city normally gets in six months! The impact of climate extremes can be tempered and even harnessed with advanced water and energy infrastructure like run-of-river power and urban hydroelectric generation.

Peru is Set to Embrace Clean Energy

If Presidente Garcia wants more reasons to embrace clean energy, Brazilian renewable energy pioneers can tell him that in their country, wind and water energy resources tend to alternate throughout the year; this means a basic level of clean energy capacity is maintained in all four seasons.

How about the slick new streets I mentioned? Well, new cars — many of them Chinese — are all over Lima. Even the taxi that picked me up from the airport had a clean-burning natural gas tank in the trunk!

Like Brazilian motorists, Peruvians are zooming away from gasoline dependence. The growing exposure of Peru's expanding automotive market to China's EV-heavy burgeoning car industry is another trend I intend to learn much more about while I'm here.

I'll be spending my time here looking at how 2010 will be a pivotal year for Peru's government and people to attract billions in foreign direct investment from international clean energy players. You'll hear plenty more from me during my stay.

And as our portfolio companies take advantage of opportunities in Peru, Green Chip International readers will profit!

Saludos desde Lima,

Sam Hopkins

International Editor

China's Renewable Energy Boom

With 2010 just around the corner, evidence is steadily mounting that this will be the year of a Chinese clean energy boom like none we've ever seen.

This past Saturday — the day after Christmas — western investors as well as ones based in the Middle Kingdom all got a gift from the National People's Congress in Beijing...

A Lump of Clean Energy in Your Stocking

In a country where the bulk of electricity still comes from coal-fired plants, the NPC has decided to supercharge the Renewable Energy Law passed in 2006 by demanding that every bit of renewable energy capacity generated in the country's hinterlands be connected to commercial grid networks by major utilities.

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Electricity networks that do not integrate clean energy into their power delivery mechanisms with haste will face major fines. From here on out, the burden of getting China's green power percentage to 15% by 2020 will rest squarely on the shoulders of grid administrators — not on wind and solar power plant operators.

Until now, projects like the 10-gigawatt wind energy farm in the western Gansu province, which I told you about back in August, have faced the prospect that the renewable resources they harness wouldn't be able to reach consumers.

Local industry analysts say that up to one-third of China's current clean energy capacity is not tethered to utility grids. Having spent time in China's western reaches, where natural resources from coal and silver to wind and sun are bountiful, I don't doubt for a second that they're having trouble linking far-flung raw power supplies to the central and eastern cities where more juice is sorely needed.

In China, as in the United States, regional utilities tend to operate too independently for a large-scale national clean energy rollout to be implemented smoothly.

Here in the U.S., as you read in my account of the American Council on Renewable Energy Phase II Policy Forum in November, clean energy companies hope that the Federal Energy Regulatory Commission will assert its oversight rights to integrate Washington's goals from the Atlantic to the Pacific.

In China, the central government in Beijing does pretty much what it wants. Like it or not, the nucleus of power in that still-Communist country can catalyze market changes with more force than D.C. policymakers ever could.

As my colleague Nick Hodge wrote recently, it's shaping up to be a China vs. U.S. clean energy battle — and China is currently on top.

The Power of Forceful Clean Energy Policy

At the Copenhagen Climate Conference, Chinese negotiators showed up with major carbon intensity reduction targets in hand: they intend to cut carbon output per unit of GDP by 40%-45% before 2020, based on 2005 levels. Officials are also maintaining their raw target of a 15% clean energy portion of total electricity generation over the next decade, up from 9% today.

China's sitting on a massive surplus of money that they use primarily to buy foreign assets like U.S. Treasury bills, but the combination of Communist Party authority and filthy lucre can be used domestically to ensure that the carbon intensity and clean energy targets are met and exceeded.

While we dance around hard-charging grid connectivity plans here in the States, the Chinese know that smart grid technology like intelligent load metering can only be maximized if all resources are linked to end-users in residential and commercial areas.

This new mandate for clean energy grid integration in China is part of a big picture that energy companies and investors are all optimistic about heading into 2010.

China isn't just linking power supplies — the government just announced plans for 42 high-speed rail lines that will run nationwide at an average of 217 miles per hour. Speed is known to be a key factor in pulling commuters and long-haul transit customers out of their cars and off of planes, both of which are heavy polluters that will hamper China's carbon intensity targets. So Beijing planners are committed to getting rail done right.

Even more broadly, the Financial Times reported on Tuesday, December 29, that China-focused equity funds took in $6.8 billion in 2009, leading emerging markets in absorbing a record amount of investment inflows during the year.

That's right — while the rich-country recession hasn't come to an end, investors have positioned themselves to profit from faster and more robust recoveries in China and other rapidly-developing economies that are instituting smart growth policies.

Nick pointed out that electric vehicle companies Hong Kong Highpower (NASDAQ: HPJ) and China BAK Battery (NASDAQ: CBAK) have delivered extraordinary gains in 2009, proving how broad the green stock spectrum is in China. Best of all, China's top clean energy companies are bringing shares to Wall Street on a platter.

It's not too late to get in on the action... not by a long shot.

You can learn more about the next frontiers of green investments with Green Chip International. We just completed our year-end review, and if you sign up now you can get up to speed on our entire strategy for 2010 and where we've taken gains in 2009.

Happy New Year!

Sam Hopkins

International Editor

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Brazil Wind Energy Auction

It's been eight months since I first wrote you from Rio about Brazil's burgeoning wind energy market. Back then, investor fervor over wind power caught me off guard...

"Perhaps the biggest surprise so far has been the enthusiasm I see for wind energy investments here.

The national wind energy resource potential is estimated at around 250GW, concentrated in the northeast, coastal south, and northwest of the major cities Rio, Sao Paulo and Belo Horizonte. As this "Wind Map of Brazil" from the Brazilian Center for Wind Energy shows:

There will be a major auction of wind energy permits in Brazil on November 25, and I've found that both local and international utilities like France's GDF/Suez are lining up to compete and get their bids low enough that the government accepts."

Well, after a delay of the auction from late November to December 14, 71 farms and 773 turbines were approved at an average price of 148 R$ (reais, the plural of the local currency the real), or about $85 per megawatt-hour, last Monday.

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Why Brazil's Wind Energy Auction Matters

In November, when a massive power outage hit 60 million Brazilians in 800 cities across the sprawling nation, we covered the energy imperative that Brazil has ahead of it as the Olympics and World Cup come to the country.

The auction generated $5.4 billion worth of interest, and 339 projects were authorized to take part.

The total wind energy output from this month's successful bidders will be 1.8 gigawatts, and that will expand to 10 GW over the next decade through subsequent auctions. The goal is to push wind power to a 5% contribution portion of the national electricity supply.

Over 7.5 hours, hundreds of companies bid on 20-year concessions during which the government will pay above-market prices for power. As in England and other feed-in-tariff countries like Germany, Brazil wants to bring capacity up by paying more for solar, wind, and biomass than it does for hydropower and coal (thermal) power.

In the case of last week's online auction (sort of like an eBay for Brazil's wind energy future), average prices came in below expectations and just above hydro and thermal.

Brazilian wind energy producers are willing to take R$148/MWh, compared to the pre-auction estimate of 160 and upper limit of 189. A recent biomass energy auction balanced at R$154, and hydropower and coal both draw R$144.

So what does that mean?

Here are a couple of choice quotes from Reuters News:

"I consider this auction to be a success given the quantity and average price that we received," said Marcio Zimmerman, Deputy Minister of Mines and Energy. "Wind power is an excellent opportunity for Brazil."

"This auction showed that the price gap between wind and thermal (generation) is shrinking and today is quite small," said Mauricio Tomalsquim, chief of a Brazilian government energy think-tank.

That bit from Tomalsquim, of Brazil's Energy Research Corporation, is key. Around the world, the success of renewable energy depends on grid parity that means clean energy can be as cheap as coal.

The Importance of Information

Now, some reports early in the week of December 14 contended that Brazilian utilities like CPFL Energia (NYSE: CPL) dropped because of lower-than-expected demand in the auction.

In fact, it was partly mistaken reporting in the week leading up to the auction that caused CPFL to rise and then fall. Bloomberg reported on December 9 that Brazilian electricity distributors that own existing wind-power plants "may benefit from increased demand... after the government canceled an auction for energy licenses due to the predominance of thermal power plants."

I scoured the Portuguese-language press and found no basis for that report; it was misinformation, plain and simple. To boot, CPFL's U.S.-traded ADR shares are still well into positive territory over the past month.

With a share price that has nearly doubled in the past year and a dividend yield of 6.50%, CPFL is one of the top energy infrastructure plays on our radar for 2010.

Companies like India's Suzlon, our Spanish holding Iberdrola, Energias de Portugal Renovaveis (the Portuguese utility's clean energy arm, which trades over-the-counter as EDPFY), and Denmark's turbine king Vestas Wind Systems are already involved in Brazil's wind power market. Vestas kicked off its Brazilian involvement in 2008 with a 92-turbine deal.

All of the companies mentioned above are on our watch list. So are a few privately-held firms operating in Brazil's wind energy build-out: Spain's Acciona and Brazilian domestic wind energy titan Wobben Windpower (a subsidiary of Germany's privately-held turbine builder Enercon), are keen to add to their clean energy portfolio in South America's leading economy.

The effects of this December's auction will ripple far beyond Brazil...

Betting Big on Latin American Wind Power Beyond Brazil

From start-ups to full-fledged Green Chip Stocks, this January I'll be checking out investing opportunities in Brazil's neighbor to the west: Peru.

Peru's economy is only about 1/8 the size of Brazil's, but the country quietly received the seal of approval of Moody's Investor Service this December, as that ratings agency became the last to raise the country's credit rating to "investment grade." With the upgrade to Baa3, Moody's rewarded Peru and leaders in the capital Lima for fiscal and monetary policy successes that are drawing increased foreign direct investment (FDI) while cutting national debt.

Santu Hulkkonen, director of a consortium called Cleantech Finland, announced in November at a biofuels and renewable energy conference in Lima that 10 Finnish energy companies will invest in Peru's wind power sector in 2010.

Just across the border from Brazil, there are clear synergies for wind power developers operating in both countries to take advantage of.

You'll get all the latest to make 2010 your most profitable year yet investing in clean energy.

Happy Holidays,

Sam Hopkins

Brazil Wind Energy

Thousands of middle-class Brazilians slept on subway station floors Tuesday night.

This wasn't a solidarity project to see what life is like for the homeless. . . It was the result of a blackout that hit 60 million Brazilians in 800 cities.

The trigger? Three — count 'em, THREE! — transmission lines. Officials say torrential rain and thunderstorm conditions caused the trio of high-voltage lines to simply collapse and in turn Itaipu, the world's largest hydroelectric dam, totally broke down.

Three is the magic number that can evidently bring one of the world's top emerging markets, enshrined in the BRIC pantheon with Russia, India, and China, into primitive darkness. Three downed lines plunged the proud hosts of the 2014 World Cup and 2016 Olympics into literal obscurity.

This is a problem whose solution requires urgent investment.

I spent two weeks in Brazil this spring, chatting with folks in corner cafes, speaking with businesspeople, and learning about the country's ProInfa clean energy infrastructure expansion plan where international companies are set to play a major role. More on ProInfa in a bit. . .

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First, I have to tell you that I've spent the past two days talking to friends of mine in Brazil, and reading the accounts of others who e-mailed the local Portuguese-language press about their individual ordeals. Each story is heart-rending, and I tell you sadly that they are more reminiscent of terror attacks than of major power outages.

Stories from the Great Brazilian Blackout of 2009

In Rio, Alessandra told the newspaper O Globo how she and her brother set out for a night on the town. Instead, they walked in complete darkness down a subway tunnel alongside the soccer stadium that will host the Cup final in four years. On arriving at the station, they waited hours longer without water, food, and the worst thing to lack during a disaster. . . news.

Jose, who lives in the world famous Copacabana beach district, experienced both the psychological and technological reality of a sudden blackout. He started to hear "the shouts of people asking for help because they were trapped in elevators, and cries of children who were afraid of the dark."

Fortunately, Jose had just turned off his computer when the lights started to flicker.

Nevertheless, countless computers were fried that night, destroying school work, music, and millions of dollars worth of business information. I can tell you first-hand that even in the hillside favelas (as the slums in Rio are called), there is a computer in nearly every home. Computers are a gateway to the world for a rising middle class around the world, and the demise of a PC can mean the death of a dream for students, artists, and others who saw a picture of a better future on their monitors.

Things won't be normal for a while. Traffic signals were still sending people at the wrong time on Wednesday morning in Rio, causing car crashes and pointing to just one lingering cost of the blackout.

Despite this nationwide infrastructure calamity, with all the money lost and Brazilians now terrified of what might happen during the World Cup and Olympics, international investors haven't lost confidence in Brazil.

Why the Lights Are Still Bright for Brazilian Stocks

The broadest indicator that I follow is the iShares MSCI Brazil Index, which is listed as an exchange-traded fund (ETF) on the New York Stock Exchange. NYSE: EWZ has gained nearly 10% since Monday, and the ETF barely dipped on the day after the power outage. EWZ rose by over 26% from mid-August to mid-November, nearly tripling the S&P 500 rally over the same period.

And this brings us to a major point you must understand if you want to outperform U.S. stock averages like the Dow and S&P. . .

Investors aren't bullish on China, Brazil, and other emerging markets despite their problems; they're bullish because solutions require money. You get your car repaired when something goes wrong, right? You only put in the money up to a point, of course, because the benefit of keeping the thing running has to outweigh the cost in the long run.

Brazil is in urgent need of investment from both domestic and international sources, and Brazil will get the money it needs. At the Renewable Energy Finance Forum in Rio this spring, I met plenty of suits who were licking their chops at the chance to put money into Brazil's energy infrastructure upgrades. . . and that was well before the Olympics were awarded to Rio!

Most appetizing to everyone there was Brazil's upcoming auction of national wind energy permits. I told you about it back in April, but it seemed far off.

Now, the December 14 Brazilian wind energy auction date is rapidly approaching, and dependence on hydroelectric generation has just caused an emergency that has scarred citizens and leaders alike (7 million Sao Paulo residents also lost water service Tuesday night due to the dam failure). Brazilians shudder to think about what would happen should a blackout of any size repeat in 2014 or 2016 when the sporting world gathers in Brazil.

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Brazil's Upcoming Wind Energy Auction

ProInfa, the national renewable energy incentive campaign, will help integrate 2 GW of wind energy capacity at a cost of about $6 billion by 2012. The companies that get ahead in the December auction will have to move fast to get capacity up by 2014, which means more production, higher profile, and higher share price.

The New York Times cites Pedro Perreli of the Brazilian Wind Energy Association's amazement that overall, 441 proposals for over 13.3 gigawatts in Brazilian wind power have come in already from companies all over the world. That more than doubles what government and local industry officials anticipated!

Green Chip International readers are already profiting from two Brazilian clean energy and infrastructure stocks, and we're watching the run-up to Brazil's wind-only auction closely.

I'll also be in Peru soon, visiting wind power facilities and talking with people with knowledge of how these deals get done across South America.

Don't miss the next play — check out GCI for yourself and start investing in energy solutions to avoid future blackouts!

Regards,

Sam Hopkins

Top Wind Energy Companies

Last year, I sat on a panel at an energy conference where someone asked me my thoughts on China's impact on the renewable energy sector.

My response was simple, upset a lot of people, and has since proven to be pretty accurate. . .

"They're going to bury us!"

I don't say this to disregard all the progress we've made here in the United States. Certainly, we've come a long way over the past few years. And there are some excellent renewable energy companies operating domestically.

But the fact is China's desperate need for more domestically-produced power that doesn't further degrade their dwindling water supplies or pollute their air — which will give your eyes and lungs a good burn on a stagnant day — is a major catalyst for renewable energy growth in the Middle Kingdom.

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This is why the Chinese government is ponying up billions in support for solar, wind, and electric vehicles. Because without these things, future growth will absolutely be stalled. They know it. . . the big money knows it. . . and if you're a long-time reader of these pages, you know it, too. . .

In the meantime, the Chinese continue to pump out solar modules cheaper than anyone else; their largest wind turbine manufacturer, Sinovel, will likely become one of the world's largest wind turbine manufacturers; and — as we're finding now — if you need billions in financing for a wind farm, China may be more than willing to provide that, too.

Laying the Groundwork for Alternative Energy Development

Last Thursday, China marched into the Lone Star State with $1.5 billion for a 600+ megawatt wind farm.

The project is actually a joint venture with Cielo Wind Power, U.S. Renewable Energy Group, and Shenyang Power Group. When completed, it will provide enough power for about 180,000 homes. Chinese turbine manufacturer A-Power Energy will be supplying the turbines.

Here's what Jinxiang Lu, Shenyang Power Group's CEO had to say about the project: "With a long track record for building some of the world's biggest wind farms, the U.S. is an ideal target for foreign alternative energy investment."

And he's right.

But this is no secret. . .

Sure, it was just last week when Energy Secretary Steven Chu told reporters that the U.S. was falling behind China and others in alternative energy investment.

But we've been reporting on this for years.

And let me tell you, you don't have to be the Energy Secretary to know that foreign corporations have been aggressively laying the groundwork for alternative energy development in the U.S.

Heck, just over the past two years, Spanish wind energy powerhouse Gamesa (MCE: GAM) has built four new wind turbine production facilities in the States. Siemens (NYSE: SI) has a rotor blade manufacturing facility in Iowa and they are currently building a turbine production facility in Kansas. And Denmark-based Vestas (CO: VWS) is now building two new manufacturing facilities in Colorado.

My friends, companies like these don't throw down hundreds of millions of dollars to build out manufacturing in the U.S. without some certainty that there's a big pay day involved. . .

And investors who ignore this fact will continue to miss out on one of the greatest investment opportunities of the 21st century.

Like our latest wind play, for instance. This one could be an easy double in six to eight months.

It's a wind energy developer based in California that could get a huge boost in about eight weeks, after California's new renewable energy mandate goes into effect.

You can read more about this wind company here.

To a new way of life, and a new generation of wealth. . .

Jeff

Canadian Wind Energy

There's a ton of money at stake in British Columbia.

Here's what I mean...

BC is the epicenter of a huge Canadian energy transformation.

Massive fossil fuel forays, like the Northern Gateway oil pipeline to the Pacific Ocean, are competing with several small clean energy developments for regulatory priority and public support. At the same time, a few intrepid traditional energy companies are stepping in to stake their claim on clean energy expansion.

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In fact, some of the Calgary crude kings are seeing the writing on the wall and signing deals to diversify into green power.

Two of the key players in this scenario are Plutonic Power and Enbridge. They're already familiar to Canadian energy investors. But soon, they'll be international names.

Here's what they — and you, as an investor — stand to gain in British Columbia.

Plutonic Power's Wind and Hydro Projects

In June, we looked at Plutonic Power Corp. (TSX:PCC), a Vancouver-based hydropower developer. Plutonic had just teamed up with General Electric's Energy Financial Services arm to push a run-of-river hydropower project in the Bute Inlet just north of Vancouver Island.

Elections in June put politics on Plutonic's side, as CEO Donald McInness told the Vancouver Sun: "It's not a given that our business plan advances, but without the Liberals winning, we certainly weren't going to advance at all."

Yet progress is slogging along for the Bute Inlet initiative, as environmental impact assessments continue and provincial utility BC Hydro considers and reconsiders Plutonic's proposals.

So in the meantime, Plutonic and the GE financing units are pushing forward with plans to tap a woefully underexploited resource in British Columbia: wind.

The pair plans to purchase the existing Dokie Ridge wind farm project from bankrupt developer EarthFirst Canada, adding a 144 MW array to their clean energy portfolios. The Dokie Ridge site can be expanded to 300 MW from its partially completed state. That would serve around 34,000 homes with 340 gigawatt-hours per year (GWh/yr), according to a press release.

If approved, Plutonic and GE will be 51%/49% financing partners, with the local firm taking the bigger stake in completing the 144 MW stage by early 2011.

What started as preliminary due diligence in June became a commitment to buy the Dokie Ridge project in late September.

Regulatory approval awaits, but the outlook is good.

Now Plutonic is on the way to establishing British Columbia's wind energy capacity. And as you can see in the map below from the Canadian Wind Energy Association, BC's wind output is currently next to nothing:

Even with GE on its side, though, Plutonic won't be the only company racing to bring BC's wind resource to life. . .

Enbridge Balances Oil Overrun and Wind Energy Options

Calgary's Enbridge, Inc. (NYSE:ENB) is a giant. Its U.S. market cap is $14.6 billion — dwarfing Plutonic's Toronto total of $161.19 million.

Enbridge's main business, as you might expect, is energy delivery. But right now the behemoth is scrambling to save faith in its biggest project, the Northern Gateway pipeline from Alberta to British Columbia's Pacific coast.

The Northern Gateway pipeline was initially backed by PetroChina (NYSE:PTR) in 2005. The subsidiary of national oil company China National Petroleum Company (CNPC) inked a memo indicating the Middle Kingdom's state-owned energy enterprises would be first in line to buy oil from Canada's Pacific Coast. Nothing official was ever finalized.

The oil in question would come primarily from the tar sands of northern Alberta, where petroleum-laden soil is essentially cooked to get crude.

On October 6 of this year, Enbridge admitted that costs to establish the Northern Gateway conduit will exceed drawing-board estimates. That overrun could be a lot or a little over the initial US$3.77 billion estimate, but the main concern is China — Enbridge hasn't had any formal talks with PetroChina since August, according to reports. We have to wait 'til later in the year, when regulatory filings come due, to get the real price tag on the Northern Gateway line.

It doesn't help matters that two parts of the TransCanada natural gas pipeline exploded in September. Enbridge may have an arduous uphill battle ahead of it before the Northern Gateway line gets approved and built.

So here's where home-country clean energy consumption comes into Enbridge's game plan.

If you scour Canadian Wind Energy Association installation lists, you'll see that Enbridge is actually a participant in Canada's wind energy industry, operating the 181.5 MW Ontario Wind Power farm installed in April of this year. All together, Enbridge operates four wind power projects totaling 260 MW.

That kind of energy doesn't go into a pipeline to China. . . it stays up in the Great White North where it belongs.

If wind weren't enough to convince you that Enbridge is diversifying away from oil and gas transport, consider this: Enbridge just announced its acquisition of a 20 MW solar power plant in Ontario from Arizona's First Solar (NASDAQ:FSLR).

That acquisition isn't an experiment or a way of throwing investors a corporate social responsibility (CSR) bone — Enbridge just bought the biggest solar power plant in Canada!

Combining for Cleaner Canadian Energy

BC Hydro bears its name for a reason: Canada's rushing rivers have long been known as a precious resource for mills, fields, fish, and energy.

As Vancouver Sun columnist Miro Cernetig wrote in June, "British Columbia is a laggard in harnessing the wind." Cernetig appeals to BC residents' sense of progressive provincial identity to make his case:

"Despite our efforts to be seen around the world as green, we make no commercial electricity from the wind. We are actually the only province with that status."

That is changing quickly.

2009 is already set to be a record year for wind energy development in Canada, and the first year with wind installations in every province, including BC.

No matter where you are, you can benefit. All types of listed energy companies are positioning themselves to profit from more record-setting years in Canada's clean energy expansion.

Regards,

Sam Hopkins

P.S. What we see in Canada today represents a broader worldwide trend that finds even petroleum titans like Chevron, Shell, and Enbridge moving into clean energy sectors. Whether they snap up existing projects or start their own, Green Chip International readers are hot on the money trail. To learn more about GCI and follow the next story like Plutonic Power to portfolio gains, check us out today.

Offshore Wind Power

Cape Cod is about to be turned upside down.

Known for its $50 million homes, yacht clubs, and kettle-cooked potato chips, it'll soon have another defining image: 130 wind turbines on the Horseshoe Shoal of the Nantucket Sound.

These turbines — rated at 3.6 MW each and provided by GE — are a part of the Cape Wind project that will be the nation's first large-scale offshore wind farm. This wind farm will have the capacity to supply enough electricity for roughly 75 percent of Cape Cod and the neighboring islands of Martha's Vineyard and Nantucket.

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While the offshore wind farm won't be operational until 2011, developer Cape Wind Associates has been hard at work, permitting and collecting environmental data since 2001.

Since then, Cape Wind has received a nearly-spotless bill of health following tough scrutiny by various local, state, and federal agencies.

In 2007, the project took a significant blow when the Cape Cod Commission denied the request for a necessary permit to begin the project, after more than half a decade of heated debate from the public.

That did not stop the project from moving forward, however. . . in May 2009, the State Energy Facilities Sitting Board presented the Cape Wind project with a composite certificate — or "super permit" — granting the project all of the approval necessary to break ground.

Of course, those who fought the project from its inception have not yet traded their picket signs for acceptance. . .

The fact is even after the Minerals Management Service found the Cape Wind project free of presenting any major lasting impacts on wildlife, navigation, fishing, tourism or recreation (which was a consistent criticism of the project), opponents continue to carry on their tired arguments.

And I suspect even after the farm is built and is sending clean green power to the region — which, by the way, endures some of the most expensive and volatile energy prices in the nation — some of these same folks will continue to present their arguments to anyone who will listen.

Fair enough.

But to its credit, the Cape Wind project has jumped through all the necessary permitting, regulatory, and environmental hoops. Most residents even support it. According to a 2008 Newswire poll, 78% of Cape Cod residents feel that their state should be a large-scale leader in renewable energy by moving ahead with offshore wind power.

It's not surprising that hordes of folks are on-board with a renewable energy project in a state where energy prices are the second highest in the United States. . . behind only the Hawaiian Islands, where a large chunk of electricity still comes from oil and diesel!

But with the energy provided by the Cape Wind project, Massachusetts residents will have a low-cost provider to compete with current options.

While estimates vary, sadly because of political leanings, some show Cape Wind is expected to save the New England region over $25 million per year on energy bills.

With projected savings like those, you can bet offshore wind is being looked to in a variety of locales.

More Offshore Wind Projects

Besides Cape Wind, there are no less than 17 offshore wind farms being planned in the United States.

The largest — a 1.95 GW behemoth called Radial Wind Farm — is slated for 2012 completion in Michigan, obviously on the Great Lakes.

And the Eastern Seaboard will soon be an offshore wind Mecca. In addition to Cape Wind's 420 MW, another 700 MW are being proposed for Massachusetts's shores.

Proposals representing several gigawatts are on the books in Rhode Island, New York, New Jersey, Delaware, and Georgia.

My home state of Maryland, through the state Energy Administration, began soliciting business interest in offshore wind last week.

And plans are coming in from the West Coast, as well, including a 150 MW farm in the works for Tillamook County, Oregon.

In Europe, several offshore wind projects have already been completed. The U.K. boasts a few hundred online megawatts, as do Belgium and the Netherlands.

But Denmark — home of industry-leader Vestas (COP: VWS) — is the far-and-away leader, with nearly 700 MW gracing their shores.

As an exclamation point on how fast offshore farms are becoming mainstream, Denmark recently commissioned the biggest project to date; turbines at the 209 MW farm Horns Rev 2 started turning in the North Sea just last week.

When it comes to an investment angle, however, the same strategies used for land-based installations apply.

Turbines are still being supplied by stalwarts like GE (NYSE: GE), Siemens (NYSE: SI), and Vestas. And installations are mostly being facilitated by either large utilities or private investors.

Given that most of the wind leaders are foreign-based, the best way to harness this growth is still through an ETF. That way, you can have exposure to several companies with skin in the wind game.

I prefer First Trust Global Wind Energy (NYSE: FAN), which not only holds all of the relevant players, but has doubled in the past six months as capital started flowing to cleantech projects once again.

It'll only edge higher as the United States, Europe, and Asia continue to increase their use of wind energy. . . both on- and offshore.

Good Investing,

—Kyle Haas

P.S. In addition to the ETF I mentioned above, Nick Hodge has given readers of his Alternative Energy Speculator the names of two other wind stocks he think will double. Click here to read about why the industry is moving so quickly, and how you can get the names of the other two wind stocks that could double.

China Wind Energy

I had never really wondered what Mars would look like if it had heavy industry. When I set foot in western China's Gansu Province in 2005, I knew.

The terrain outside Lanzhou, Gansu's capital and one of the most polluted cities in China, seems other-worldly. Bizarre stone shapes line the road as far as the eye can see. And, as it turns out, you can't cast your gaze very far through the brown haze that shrouds the city.

Pregnant women ride their bikes around Lanzhou wearing surgical masks so as not to inhale the noxious air, but so do many men. It's a frightening sight, and I'd be lying if I told you I didn't feel a little guilty that I would be able to go home to clean air while locals seemed doomed to a life of sooty snot and coughs.

Now, though, I feel more optimistic about Gansu's future. . . the province will soon be home to China's first 10 gigawatt wind farm.

China's Hinterlands are Ignored No More

People in Shanghai or Beijing will give you a funny look if you talk about places like Gansu. . . Those places normally only draw attention when something bad happens, like last year's terrible earthquakes or this summer's riots in Gansu's neighboring Xinjiang Uyghur Autonomous Region. Here you see Gansu highlighted in red:

In spite of the East Coast's ambivalence about the hinterlands — or perhaps because of it — the Chinese government has set the goal of turning Gansu into a wind power equivalent of the enormous Three Gorges Dam, which has a 22.5 gigawatt capacity.

The 10 GW turbine cluster planned for the area around the city of Jiuquan is part of Beijing's $14.6 billion infusion into wind energy through 2010. With all that money, top brass want to more than double nationwide wind capacity by next year.

And when 2020 rolls around, China will have 100 GW of its own installed wind capacity up and connected. That nearly equals the entire world's current capacity of 121 GW!

But here's the rub. . . Grid connectivity is where the needle scratches across the record for wind farm proposals around the world. T. Boone Pickens' plan to build a massive wind farm in Texas got stuck on transmission line financing and regulatory clearance, and from China to Chile it's true that, as Jeff Siegel says, "If you can't move it, you can't use it."

So it's a good thing that China is using a full 23% of its massive half-trillion-dollar economic stimulus to prime the national grid for fresh renewable energy projects.

Forget Everything You Know About the Bakken

Most estimates for the sweet light crude reserves in North Dakota's Bakken Oil Pool are in the 4-6 billion barrel range.

But the CEO of the biggest Bakken oil company says there's as much as 24 billion barrels.

That means your Bakken oil stock profits are about to get a LOT bigger.

You can watch the incredible video footage HERE.

That's right. . . over $134 billion has already been allocated to create a high-voltage direct current (HVDC) network to not only tether wind farms to cities that need clean energy, but also to optimize that network with responsive smart grid technology.

How much has been set aside for smart grid in the U.S. stimulus package? A comparative pittance of just $6 billion. That's less than one-tenth of one percent of the $787 economic nudge we're supposed to get stateside!

China knows it needs to commit that money if renewable energy is to become a reality, rather than just a government talking point or stock-market fad.

China and the United States: an Uneven Partnership

You see, China's only got a 73% success rate right now when it comes to moving wind-generated power to end users. Out of 12.2 GW of installed capacity at the end of 2008, only 8.9 GW ever made it to customers.

For engineers and officials charged with transforming sprawling and far-flung provinces like Gansu — described to me by my local host as a "big dog-bone" on the map — transmission losses add up to failure.

So ground-up renewable energy expansion is what we like to see, especially in places like western China, where locals can leapfrog eastern mega-cities that will require much more intensive conversion to be RE-ready.

But why is the resource balance so heavily tilted when we compare Washington's grid plan to Beijing's?

Maybe it's the fact that many rural Chinese denizens still live a centuries-old lifestyle. . . they know not to put the cart before the ox, as it were.

Or maybe it's that we have plenty to learn from China. After all, as Secretary of Energy Steven Chu was quoted in this month's Time Magazine, "Whatever the U.S. and China do today will determine the fate of the world."

That pairing is uneven, and China is the larger chunk when it comes to clean energy.

Looking to China for Clean Energy Stock Profits

Tech-side wind energy player American Superconductor (NASDAQ:AMSC) attributes much of its 80% share price increase in the past half-year to business activities in the Middle Kingdom. "China's our fastest-growing market," an AMSC spokesman said this month. "We're not counting on U.S. stimulus money," he added sharply.

So there's an American company depending on China for growth. In the other direction, some Chinese wind energy stocks are skirting the U.S. altogether, even when they're going for international attention.

Xinjiang Goldwind, named for the restive and resource-rich western region it calls home, has repeatedly rejected Wall Street IPO offers, opting instead to get cozy on the domestic Shenzhen secondary exchange (SHE:002202).

Then there's China Wind Power International Corporation. China Wind Power just listed on Vancouver's TSX Venture Exchange, which has long been a favorite for junior mining and energy companies. China Wind Power (TSX-V:CNW) CEO Jun Liu touts his company's listing as "an opportunity for Canadian investors to share in the substantial wind energy growth expected for China."

The company's near-term capacity goal is 546 MW for projects in the northeastern province of Heilongjiang. That's a chip shot towards China's 100 GW target for 2020, but every bit counts.

We'll keep you in the know about the goings-on in Gansu, and all the latest investment opportunities on the arc towards China's 100 GW wind energy goal.

Regards,

Sam Hopkins

Global Wind Energy

This past Saturday, construction began on the first of seven 10-gigawatt wind power bases in China.

We initially told you about these wind power bases last month, when the vice president of the Chinese Wind Association announced the project — which is to be completed by 2020. Certainly this is a major part of China's wind power goal of 100 gigawatts by 2020.

But as we've said time and time again, this is a global trend.

While new government support in China and the United States is providing fertile ground for opportunity, it cannot be the sole focus of our strategy to profit from renewable energy.

Yes, because of renewed momentum in the U.S., our favorite wind developer play has shot up 112% since the beginning of the year. And we'll continue to play this one too, as the stock has really only scratched the surface as far as what it'll produce over the next six to eight months.

But the world is a big place. And the fact is there are already hundreds of active wind farms across the globe. Here's a map to give you an idea where most are concentrated today. . .

And here's a map that shows wind farms currently under production:

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Finally, here's a map of wind farms that are now planned for future development:

That's A Lot Of Turbines!

As is no surprise, some of the largest wind turbine suppliers continue to be Vestas, Gamesa, Suzlon, and GE. And it should be noted that Sinovel is becoming a pretty big player in China.

Sinovel is one of the largest and most successful wind energy companies in the country. And if you know anything about how the Chinese do business, you know that Chinese suppliers are almost always given top priority.

That being said, one U.S. company that's been benefiting from Sinovel's momentum is American Superconductor (NASDAQ:AMSC).

Back in 2007, American Superconductor (through its Windtec subsidiary), landed a deal with Sinovel to jointly develop 3- and 5-megawatt wind energy systems. But a couple of weeks ago, American Superconductor announced that it had increased its sales contract with Sinovel by $20 million, making the total deal now worth $470 million. Sinovel is also AMSC's largest customer, responsible for about 70% of its order book.

And if you're wondering how American Superconductor has done this year, take a look. . .

We'll have more on China's burgeoning wind industry later in the week, when our international renewables expert, Sam Hopkins, gives us a look into the future of Chinese wind development.

To a new way of life, and a new generation of wealth. . .

Jeff

*Maps provided by GlobalData

Renewable Energy Investing

Knowing which stocks to buy and when is a beautiful thing.

It's a skill that's beyond difficult to master but, once perfected, can have life-changing implications. And it can be a bit easier if you focus exclusively on specific sectors.

Someone claiming to be able to rattle off winning stock advice on any company with a ticker — Cramer comes to mind — is either lying in the first place or has never been held fully accountable. (A recent study of his picks showed that his risk-adjusted returns were barely above the market average.)

But honing in on one sector, like Green Chip has been doing for years, has allowed us to become intimately familiar with a certain group of stocks. So much so that I'm confidently familiar with dozens of companies pursuing clean technology — both the good ones and the bad ones.

For instance, I know the comfortable price ranges for no less than ten Chinese solar stocks. I know where they should be trading based on future earnings forecasts; how well their peers (other Chinese solar stocks) are doing; outside factors like government; and most importantly, investor confidence.

And it's what allows me to give an edge to readers of the Alternative Energy Speculator, day in and day out. It's how I've helped them play the same Chinese solar stock SIX TIMES for profit in the past eight months:

Stock	Bought	Sold	Gain
JA Solar (NASDAQ: JASO)	11/13/08	11/24/08	30.45%
JA Solar (NASDAQ: JASO)	12/01/08	12/31/08	43.91%
JA Solar (NASDAQ: JASO)	03/03/09	03/04/09	13.66%
JA Solar (NASDAQ: JASO)	03/05/09	03/09/09	9.89%
JA Solar (NASDAQ: JASO)	04/07/09	05/06/09	36.56%
JA Solar (NASDAQ: JASO)	05/08/09	05/27/09	10.13%

And we're back in that same stock right now. . . even as you read this!

That's more than a fluke. That's more than luck.

That's knowing exactly where a stock should be trading and pouncing on every opportunity it presents — that's the Alternative Energy Speculator.

And it's not just JA Solar. . . my readers closed ten other Chinese solar winners in the same time.

And solar stocks aren't the only plays coming up big. . . from wind to water, we've closed 30 winners so far this year in everything cleantech.

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A Clean-Tech Case Study

In early June, I put out a new buy recommendation to my my readers. It went something like this:

I wanted to take a minute this morning to bring your attention to our smart grid plays.

We're currently doing well with XXX and XXX. They're up 38% and 18%, respectively. We've only held the latter for six days!

XXX, which also has exposure to the smart grid, is up 13%.

And we've successfully played Intellon (NASDAQ: ITLN), Comverge (NASDAQ: COMV), and American Superconductor (NASDAQ: AMSC) in the past.

We'll revisit past plays as I see opportunity. And I want to do just that with American Superconductor today. I think it's a $35.00 stock. So let's buy shares of (NASDAQ: AMSC) today below $28.00.

I'm also raising the buy under and target prices for XXX and XXX. You can see them in the portfolio.

I guess I probably should've said, "I know it's a $35.00 stock," because last week it climbed to $36.24 on the heels of a stellar earnings report.

Had you taken my advice and invested. . . you would've been sitting on a 35% gain when it popped. And while that's impressive, focusing solely on gains means missing the bigger point here.

In the company report that accompanied that recommendation I highlighted the following key points:

Company revenue guidance is conservative
Has already contracted 85% of expected revenue for fiscal 2009
Wind division is growing quickly
Can benefit from multiple markets: voltage, wind, transmission

Well, the second quarter numbers came out a few days ago. . . and you can probably guess what happened.

The company shattered revenue estimates — even mine — by about $12 million. And earnings per share of $0.04 blew away most analysts who were looking for flat earnings to a slight loss.

So the guidance was clearly conservative.

And my statement that American Superconductor's "wind division is growing quickly" turned out to be one of the understatements of the year. Chinese stimulus funding for wind energy could spark 100% growth in two years or less, and that was evidenced on AMSC's balance sheet in the form of increased orders from Chinese wind developers.

Beijing's Sinovel increased orders by $20 million and accelerated the term by eight months — meaning they'll be ready for next order sooner than expected.

I knew all of that in June. . . and so did my readers. But the rest of the investment world didn't find out until last week, when the stock had already soared 30% in one day.

Only Going Higher

That winner is just one of 13 still sitting in The Speculator portfolio. . . just waiting to be cashed out.

And that's on top of the 30 others we've closed for gains this year. As a Green Chip reader, you had to see this coming. We were predicting a renewable revolution two years before First Solar was even publicly traded.

That was half a decade ago!

Take a look around you today. Companies from Aflac to Yahoo! are touting their green credentials while we've been busy taking profits on the companies making it all happen — from American Superconductor to Zap.

All major cleantech segments have estimated growth rates that outpace the most beloved Wall Street sectors. . . I'm talking about a doubling of the solar and wind industries in the next three to five years.

No other industry is growing like that: not metals, not oil, not retail, not biotech.

We're in Wall Street's catbird seat — the position all other industries want to be in.

We're getting Federal dollars, being looked to as a solution to the recession. We're viewed favorably by the media and global governments. We're providing clean energy and sustainable practices.

And above all, we're making money.

If you haven't yet, now is the time to let us help you do the same. And you can do it, risk-free.

Use this link to sign up for the Alternative Energy Speculator with a 30-day trial. You can check out the portfolio, past updates, and the in-depth reports featuring earnings estimates and company-specific information.

You'll also begin receiving buy and sell recommendations. At our current success rate, it won't be long until you receive your first one. . . we've closed a winning stock for every week so far in 2009!

And if you still don't like the service after 30 days. . . you can get back every cent, no questions asked.

But you can't see how great it is — or how much money you'll make — if you don't try it.

Start closing cleantech winners today!

Call it like you see it,

Nick

Wind Energy ETF

U.S. wind power investors needed a pick-me-up this July, and they got it from beyond the border.

Early in the month, oil billionaire and newly-styled alternative energy bull T. Boone Pickens balked on an ambitious, multi-billion-dollar wind power project in Texas. Pickens said funding difficulty forced him to fold, but recent action on Capitol Hill leads us to believe that Pickens is shifting his focus to his favorite alternative (but not renewable) energy project: vehicular natural gas.

Whatever his angle was, Pickens's move stung. . .

At least for a few weeks.

First Wind's Financing Breakthrough

In mid-July, the Alberta Investment Management Corporation (AIMCo), a Canadian pension fund worth approximately US$64.7 billion, committed $115 million to Massachusetts-based developer First Wind.

Germany's HSH Nordbank also put up $76 million in financing for First Wind, enabling the company to add capacity at existing wind farms in New England and Hawaii.

So on one hand, there's AIMCo, which will distribute its infusion to First Wind over eight years, coming to just over $14 million per annum.

Nordbank, on the other hand, is taking the short-term approach. Their larger one-year infusion to First Wind combines with AIMCo's long-term vote of confidence to show that solid wind project plans can still get funds for expansion and that new farms can get up and running.

The American Wind Energy Association does say new projects have slowed — from 2,290 megawatts of installation in the first quarter of 2009 to 1,210 MW in Q2.

"The recession is a force that is having an effect on the industry, as it is on most other industries," a spokeswoman told Reuters this week.

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But the year-on-year change in U.S. installed wind power capacity is still impressive — new installations in the first half of 2009 surpassed the same period in 2008 by 1,100 MW.

The AWEA now puts total national generating capacity at 29,440 MW. Texas led all states in helping achieve that number, even in spite of the Pickens pullout.

With recovery on everyone's lips, credit market conditions will continue to change, though that transformation will lag behind benchmark economic indicators.

And as in the case of First Wind, the start-to-finish process of wind farm development from here on out will be far more internationally integrated.

Venture Capital Comes off the Bench

National stimulus packages, which some observers thought may be renewable energy's only lifeline through the recession, has actually turned out to be just one part of the financing picture for eager companies.

The Wall Street Journal reports that cleantech venture capital activity is skyrocketing: Deals doubled from Q1 2009 to Q2, and the dollar value of those deals rose by 73%.

Access to VC funding is essential for bringing next-generation renewable energy ideas from the drawing board to grid-readiness. And since venture capitalists are generally "serial entrepreneurs" with defined exit plans, this isn't pity money going to sub-par projects.

Deep-pocketed VCs join big-money institutions like AIMCo and Nordbank, which operates throughout northern Europe and is partly owned by the City of Hamburg, as they search all over the world for well-timed advantage.

First movers are getting in on companies like First Wind now; First Wind already runs New England's largest operating wind farm in Stetson, Maine.

The broader market trough is giving way to a financing upswing and even delivering major gains to wind power ETF investors.

The First Trust Global Wind Energy ETF (NYSE:FAN) has international wind energy titans as its top holdings. Iberdrola Renovables (Spain), EDP Renovaveis (Portugal), and Vestas Wind Systems (Denmark) top the holding list, bringing utility-scale wind success stories into your portfolio in one easy trade.

FAN is trading at just below $15 per share, sitting on 31% upside in the past six months.

Regards,

Sam Hopkins

P.S. Nick Hodge and I have stayed ahead of the market when it comes to the changes that are driving new renewable energy finance. Talking to bankers and developers from the U.S. and elsewhere, learning about new technologies, and traveling to emerging energy hot spots personally has brought Green Chip International readers the edge, and the advantage continues to bring in double-, even triple-, digit gains! To learn more, check out GCI today.

The Wind Energy Industry

I've heard all kinds of remarks since T. Boone put the brakes on one of the world's largest planned wind farms last week.

Hardly any of them have been good, most of them are even using this to signal the death of renewables.

The death of renewables? Phooey.

This is the death of T. Boone's grandiose wind plans. Nothing more.

He's still in the wind business per his own admission. He's still going to employ the $2 billion worth of GE wind turbines he's already purchased. He's just not using them all at one giant wind farm, mostly due to Texas' lagging in building out transmission.

Here's some data the media and the uninformed seem to be forgetting about.

Of Pickens, Babies & Bathwater

First of all, let us not forget that the turbines for Pickens's giant 4,000 MW wind farm weren't even scheduled to be delivered until 2011.

Let us also not forget that even though the large farm is being canceled (or delayed), Pickens is still going to use the 687 turbines he's already purchased by building "three or four smaller wind farms, at a cost of some $2 billion."

Lastly, let us not forget that we're in the middle of a capital calamity. Bear Stearns is gone. Merrill is gone. Chrysler is gone. So are countless other businesses, brands, pensions, and plans.

Is it that shocking that renewable energy plans are slowing as well?

Renewable energy is a lot of great things, but it's not recession-proof.

Was this bad press a psychological blow for cleantech? Absolutely.

Is it the end of the industry and its profit potential? Absolutely not.

In reality, this is simply Boone being Boone, pursuing business as usual. The recession put a bump in his road, and he's nimbly navigating around it.

According to the billionaire, "We're going to be active in the business. It's not that we've gotten out of the business or anything like that."

And according to the spokesperson for his BP Capital Management firm, "Boone still remains committed and focused on developing wind energy in the United States. The timing is not as aggressive as he originally outlined because of the collapse of the capital markets and because of the steep downturn of natural gas prices."

So, I have two questions:

Is there a major industry that hasn't been stymied by the drying up of easy capital?

How does adapting to the current business environment signal the end of an industry?

Let's just take this for what it is, fallout from the recession.

And by all means, let's not through the wind baby out with Pickens's bathwater.

Wind Blowing Strong

Indeed, it seems the Pickens event was enough to give naysayers a few last breaths in recent days.

I've even heard it put as bluntly as "Nobody gives a fu** about the climate right now."

I'll let the G8 comment on that. Just last week those leaders agreed "to limit global warming to 2 degrees Celsius and cut its greenhouse gas emissions by 80 percent."

Oh, and the House just passed massive climate legislation as well.

And while I'll concede that climate change has taken a partial backseat to economic turmoil, the energy problem certainly hasn't. It's often overlooked that we're pursuing, investing in, and trying to expand renewable energy — not renewable climate change mitigation techniques.

That said, wind energy is actually looking quite strong.

Enough Metals to Supply the World for Over 100 Years

That's exactly what one tiny explorer is sitting on.

Not only that, the total value of these rare earths and precious metals exceeds its market cap by over 74,000%.

It's a jaw-dropping opportunity unlike any the mining world has ever seen.

And it's set to make early investors a small fortune.

Click here to make sure you're one of them.

Recent reports from major European turbine producers like Vestas, Gamesa, and Nordex all point to a second-half recovery for wind financing. Most have nearly signed enough contracts to meet their 2009 fiscal sales and revenue guidance, with July and August being typical months for large wind orders.

And after this recession, wind energy will emerge even stronger.

29 of our 50 states have passed and signed into law some form of a renewable portfolio standard. That means the increased use of renewables is being mandated by law. Some five other states have similar voluntary measures, the House has passed a national version, and the Senate is about to consider it.

There is no legislation on the table to mandate the use of any non-renewable fuel.

Also going unnoticed are the tools being used to combat this recession on a global scale. In the rush to pass stimuli, renewable energy has emerged as the frontrunning combatant.

Since late last year, hundreds of billions of international dollars have been pledged to boost the use of cleantech as a path to economic prosperity.

Taking those funds into consideration, the wind business has never looked stronger. In the U.S., wind energy capacity is now forecast to double by 2011 (with or without T. Boone) from 25,369 MW installed at the end of 2008 to nearly 56,000 MW. It will triple by 2013 and quadruple by 2015.

That's just in the U.S.

In China, a recent $15 billion initiative will double their use of wind energy in the next year from 12,000 MW to nearly 30,000 MW. This is part of a bigger Chinese cleantech program that will spend $290 billion by 2020.

When it comes to global totals, the use of wind energy will double by 2013 and triple by 2016.

No non-renewable energy source will see that type of growth in the coming years. Period.

To Infinity and Beyond

This last fact is also often overlooked or misused to decry renewables.

Yes, renewables currently only account for a fraction of global energy use. But this isn't a bad thing. It means there is plenty of room to grow.

Renewables are the ground floor. Fossil fuels are slowly vacating the penthouse.

This is why the growth numbers are so astounding. . . and the investment potential so high. When you start at 0.1% of the energy mix, it's easy to double, triple, quadruple, and more.

The upside is a century long.

It means renewables have everything to gain and traditional energy sources have everything to lose.

And losing they are, even if Pickens is the one making headlines.

You see, while one wind farm cancellation dominated headlines last week, it went largely unnoticed that the 100^th coal plant was canceled since 2002.

Not the first. . . the 100^th. It certainly seems worse for coal than wind.

Because while states are passing laws to increase the use of renewable energy, Los Angeles said last week that it will stop using coal-fired power altogether by 2020. What's more, according to Reuters, "No utility-scale coal power plants operate in California anymore, and the state has banned new contracts for imported coal power."

So, for a quick exercise in logic:

T. Boone still wants to build his wind farm and pursue wind energy, but a lack of financing and transmission capacity have forced him to alter (not cancel) his plans.

100 coal plants have been cancelled in the past 7 years. And there's a movement, led by California, to ban their future use altogether.

For which industry is this news worse? You decide.

Call it like you see it,

Nick

P.S. Better yet, let your portfolio decide. The Alternative Energy Speculator is proving cleantech is the real deal with each and every closed winner. We proved it 27 times in the first half of 2009. Click here to read about our latest profit play and join thousands of other savvy investors who know clean energy is here to stay.