California Scheming

Clean Technology: As Obama prepares to take office, Silicon Valley is sensing a change to land backing for an array of project that us IT to boost green energy and help create jobs.

Barack Obama has expressed support for a 'smart grid' to optimize electricity transmission and save power. It should be capable of carrying power from the place where it can be created - the windy centre of the US, the sunny south-west and the geothermal hot spots in the Rockies - to the coastal cities where it is most needed. I am currently investigating the technology and processes behind 'smart grids' and geothermal power plants, and will hopefully have a synopsis of both up shortly.


California Scheming

By Richard Waters in San Francisco

Published: January 14 2009 19:58 | Last updated: January 14 2009 19:58

A new Silicon Valley is being born. The northern Californian region that brought the world microprocessors, personal computers and Google now has its sights set on another technological revolution: one founded on photovoltaic solar cells, sources of biofuel such as algae and the application of information technology to improve energy efficiency.

Yet this new green technology industry needs help. As Barack Obama prepares to take office as US president next week, Silicon Valley has sensed that a turning point is at hand. It has been working overtime to convince the incoming administration of the strategic importance of these developments – and their need for financial backing.

To hear Valley notables describe it, the answers to some of the biggest issues facing the US can be found there. These range from climate change and America’s lack of energy independence to the need to create jobs and ensure long-term competitiveness in the next big strategic industry, the one geared to weaning the world from its reliance on fossil fuels...MORE

Clean-Tech Stocks Set for Rebound

Clean technology stocks are set to rebound in the next three months, following a dismal performance in 2008, according to a report from Banc of America Securities-Merrill Lynch.

But the rally will be “within the context of a continued bear market”. Bank analyst Steven Milunovich said earnings revisions from the sector in 2009 are likely to remain negative, as funding remains difficult to secure and competition heats up.

Meanwhile, he expects the flurry of government spending – much of which is to be directed at environmental infrastructure – “to prove as ineffective as it was during the Depression/New Deal” and that sustained improvement is unlikely before 2010-11.

The Cleantech Perspective report published on Tuesday cited several reasons for the bounce: optimism regarding US President-elect Barack Obama’s support of renewable energy, a bounce back from extremely poor performance, clean-tech being inexpensive relative to the market average price/earnings and price/earnings-to-growth ratios, and technical support based upon many sectors breaking above their 50-day moving average – which is often interpreted as a bullish signal.

Solar energy stocks delivered the worst performance of the clean-tech sectors in 2008 – falling 69%, according to the bank’s index – but solar is now expected to lead the rally. Candidates for a snap-back include Q-Cells and REC, Milunovich suggested.

He is also over-weighting geothermal energy, “a more promising renewable than many perceive” and energy efficiency, for its quick project payback in a tough economy and relatively low correlation with other sectors.

However, Milunovich is less optimistic about the prospects for alternative fuels, water and energy storage. “Little good is likely to happen until second-generation biofuels arrive,” he said, while the water sector will suffer from poor earnings revisions, and it is “too soon” for the technologies of energy storage to make an impact, he added.

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