NEVs blog

Suprisingly, after losing 52% of its value from inception until the end of 2009, the iPath carbon GRN is leading all sustainable ETFs and mutual funds this year with a robust 1.4% YTD return. Airshares launched during this debacle and was unable to attract sufficient investment to stick around and stopped trading in August 2009. GRN’s performance is even more surprising given the generally downbeat news for cap and trade in the US driven, IMO, in large part due to the down economy, controversy over climate science, and downward pressure on fuel prices. Even California’s governor, a staunch supporter of cap and trade, is now talking about slowing down the state’s implementation of AB32.

But an even bigger hurdle for cap and trade (other than the horrendous complexity of these programs) is expanded supplies of reasonably priced natural gas. A little bit of substitution of coal by gas in electric generation and gasoline by gas in transportation may yield enough carbon mitigation to moot the cap and trade argument. With this kind of regulatory overhang, investing in carbon trading looks risky.

My web host has decided to make its web environment safer by changing a setting in its web hosting language.   Unfortunately, my graphics package makes extensive use of this feature.  This wouldn’t be so bad if the web host used the latest version of the php programming language so I could update to the latest graphics package.   Catch 22.  We’re all safer but I won’t have any graphics until I move to a different web host or find a solution.   Why don’t I feel better about being safer?

The publicly traded fuel cell industry continues to have problems.  The latest change affecting Camino’s index is the delisting of Medis Technologies from the NASDAQ to the Pink Sheets on 8/25/2009.   We have removed Medis from our equal weight index which now contains just 6 firms.    These firms are headquartered in four different countries and have an average market cap of USD 142 million.

The correction started by the “Panic of 2008” continued with the broad US market falling until March and then rallying to finish out the first half of 2009 close to neutral.  The S&P closed 7/2 down 0.76%  YTD (excluding dividends). 

In general, sustainable energy stocks followed this pattern but were bid up more then the broader US market and posted some strong gains YTD as shown in the summary below.   In particular, Camino’s LIGHT index posted nearly doubled indicating this strategy may have potential.  See my previous post  about LIGHT and I’ll comment more on this later. 

Even with these gains, this volatile sector still has a long way to go to erase last year’s steep declines.

The biofuel index has been updated to reflect the delisting of Aventine (AVR).   Great Plains Renewable Holdings (GPRE)  has been included in the index which still contains nine companies.   Additional updates may be necessary if other index constituents decline futher in market cap or file for Chapter 11 (or its equivalent).

A once growing group of public companies continues to shrink.  We have discontinued coverage on Aventine Renewable Enery Holdings (AVR) due to its April 8, 2009 Chapter 11 filing.  It joins Panda Ethanol which was delisted after its Hereford subsidiary filed Chapter 11 on January 23, 2009.  

After these filing there only remain five (5) publicly traded, pure-play corn ethanol companies with market cap greater than USD 10 million.  Only Great Plains Renewable (GPRE) has a market cap greater than USD 50 million.

Camino’s Solar index has been updated effective January 30, 2009.  Two companies, aleao solar (AS1.DE) and Solar-Fabrik (SFX.F) were removed due to their market cap declining below USD 100 million.  Two companies, SMA Solar (S92.DE) and GT Solar (SOLR),  passed all of Camino’s screens and were added to the index.   The number of companies in the index remains at 31.

While 2008 reduced the number of renewable electricity companies passing Camino’s PurePlay screens, there are still sufficient companies to permit construction of a modified market cap weighted index.   Effective January 30, Plutonic Power (PCC.TO) and Novera Energy (NVE.L) were removed from the index due to their market cap falling below USD 100 million.   Two companies, Terna Energy (44T.SG) and Fersa Energia (FRS.MC) were added.   The index continues to have 20 names with a combined market cap of USD 53 billion.

Whether you think Cap and Trade or a Carbon Tax is the way to manage this greenhouse gas, you can invest in allowances via two vehicles.    It took forever to come to market but the AirShares ETF is now trading under the symbol ASO.   The older alternative, the iPath ETN (GRN) has been on the market since last July.   Of course, when you invest in an ETN you are buying an unsecured note of the issuer….so given recent events this might be a consideration.

In our company research section we track the four major “emission credit” companies.  We have also just added the the return computations for ASO and GRN to our comparables page.

Each update seems to highlight more OTC companies that are deliquent or have moved to the Pink Sheets.  This time Americans Wind Energy Corp. (AWNEE.OB) and XSUNX, Inc. (XSNXE.OB) are delinquent and Electro Energy, Inc. (EEEI.PK) has moved to the Pink Sheets.