Ready to burn an extra $3,000 each year? As if energy prices were not creating enough havoc throughout this country, the Obama administration is getting ready to pounce on the idea of a cap-and-trade system.

There is a good chance their plans could cost each of us a few extra grand each year.

Call the extra figures that will trickle into our monthly energy bills an investment on the future. Or call the increased costs a “usage” fee that goes straight to Uncle Sam. Just don’t call it a tax, as we all know Obama is a tax-cutter.

It is too early to tell if Congress will be naïve or stupid enough to pass any sort of cap-and-trade legislation in the near future, but it is certainly not too early to hear some of the nation’s best and brightest investors calling the idea what it is.

“Monstrously stupid,” is what Berkshire Hathaway’s vice chairman, Charlie Munger, called Obama’s plan.

Even if the majority of credits were given to the nation’s carbon-producing industries, Obama’s cap-and-trade system would almost instantly raise the price of just about every product and service sold in this country. It stands to be the most ineffective, yet most dangerous tax in the nation’s history.

Even so, emotional, feel-good investors are finding a way to profit.

Unsustainable investing

If you visit these pages often, you probably know my disdain for the green-energy industry runs deep.

It’s not that I hate Mother Nature and want to see the earth shrivel up and die (in another career I am an outdoors writer and nature junky). My hatred of the green investing movement is due to its infallible record of destroying wealth.

I started my career as a financial advisor, and my fiduciary duty to protect wealth still runs deep.

For generations folks have been working on electric cars, super-efficient solar panels and waste-based fuel sources. It has been one of the most predictable cyclical markets in history. Invest when energy prices are high. Lose money when prices naturally decline.

One company on track to lock investors into the cycle is First Solar (NASDAQ:FSLR). The company and its low-cost solar panels are making its in-and-out investors a pile of short-term profits. But if you are a set-it-and-forget-it kind of investor, you had better pay attention. The action will not last.

Set your sights on a long-term investment in anything solar, and you might as well forget about profits. The momentum fostered over the last six months or so is simply not sustainable. The government will not be handing out billions in stimulus for the next thirty years (I hope). New venture capital won’t be spurring the industry in a race to be a first mover. And most importantly, consumer demand will have long moved onto the next trend. We are a fickle nation.

Let’s face it. With current technology, solar panels cannot provide the kind of reliable energy the average consumer needs. Sure, a handful of “greens” will build their houses in a cloudless desert to make themselves feel good. But for those of us that live in area where moisture rules the middle atmosphere, solar panels are nothing more than expensive yard art.

So here’s my advice. If you can make a trading move with relative speed, invest away. The “green” industry will do well over the next six months while Congress gains votes debating cap and trade.

But if you are risk adverse and are investing for retirement, stay away. Stick with proven industries with high-quality revenue streams.

Until science is no longer a political debate (when did that start, anyway?), the solar industry will be too unpredictable for quality-minded investors.

Source: Solar Investing: My apologies in Advance

This from Taipain Daily:

For the last 25 years, Soros observes, the “motor of the world economy” has been the American consumer. And not only has the American consumer been aggressively consuming, he “has been spending more than he has been saving.”

“So that motor is now switched off,” says Soros. “It’s finished. It’s run out of — can’t continue. You need a new motor.”

The declines of that truly awful week when the Dow lost 18% were tied to the credit crisis. Before governments across the globe stepped up, there was a fear that nothing would be done.

The declines that followed Monday’s rally, however, were tied to a separate issue… rooted in fears that the US consumer may, after many years and countless false alarms, be well and truly tapped out.

If so, we don’t know what the new “motor of the world economy” is going to be.

Soros has a notion of what that new motor could be. Moral aspects aside, I think he is right. It’s an idea some readers will like and others will hate…

“We have [another] big problem,” Soros says. “Global warming. It requires big investment. And that could be the motor of the world economy for years to come… instead of consuming, building an electricity grid, saving on energy, rewiring the houses, adjusting your lifestyle where energy has got to cost more until you introduce those new things. So it will be painful. But at least we will survive and not cook.”

The Green New Deal

Concerns over global warming and the high cost of fossil fuels are closely aligned. Whether or not you embrace the concept of global warming – and there is still real debate on the subject – you no doubt remember the sky-high fuel prices the world had to deal with earlier this year.

Energy prices are falling now, mainly due to deflation fears and the phenomenon of “demand destruction.” But when global growth resumes, energy prices will go right back up again. And then there are the indirect costs, like the rampant pollution and quality-of-life issues that plague China and India.

Many top thinkers thus agree with Soros. There is a very strong feeling that the world needs a “Green New Deal”… an alternative-energy-focused motor that can get the global economy humming again.

2008 versus 1932

Let’s take a quick look at the similarities between now and the 1930s.

When FDR took office in 1932, a devastating financial crisis was in full swing. (Sound familiar?) The country was desperate for leadership. Partisan lines were blurred as the whole of America demanded change.

FDR wasted no time laying into the bankers. His harsh words were right in synch with today’s times: “Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men….The money changers have fled from their high seats in the temple of our civilization.”

Fled from their high seats, indeed. After declaring a bank holiday, FDR wasted no time in drafting new legislation, overhauling the system, and generally trying to get America back to work.

American farmers were a major focus of FDR’s New Deal. The general belief was that farming held the key to getting the economy back on its feet. In the end, many controversial programs and measures were put in place… more than a few that live to this day. While farming served as the linchpin back then, green energy can serve as the linchpin now.

So was the original New Deal effective? Was it a good thing? That’s a can of worms your humble editor would rather not open.

Some feel FDR did little more than dig holes so he could order men to fill them up again. The skeptics further argue it was really only World War II that brought the United States out of its epic slump. FDR’s defenders, on the other hand, feel that the programs implemented and leadership provided were absolutely necessary for the times. Your humble editor shrugs.

Pragmatic Thoughts (Not Moral Pronouncements)

We are more interested here in sussing out what’s likely to happen, rather than debating the right or wrong of whether it should. And in that regard, it looks like the pieces are in place for the new FDR (i.e., America’s next president) to implement a Green New Deal.

Consider the backdrop of current events:

• We are in a time of unprecedented financial crisis (not unlike 1932), with little or no dissent toward the assertion that free-market capitalism has imperiled its very existence (and must be reined in).

• The American public – and the world at large – is desperate for leadership, to a degree that is only possible in a time of true crisis. (When things are better, people focus on their day-to-day lives.)

• Political leaders have the added impetus of avoiding at all costs a repeat of the mid-to-late 1930s. Their desire to sidestep the full “Great Depression experience” creates an added sense of urgency.

• In terms of economic thought, John Maynard Keynes rules the day. When all the “guarantees” are added up, trillions have already been committed on both sides of the Atlantic. Trillions more could well follow.

• U.S. consumers account for 20% of world GDP in spending terms (Martin Wolf). Global leaders everywhere are deeply aware of the danger of John Q. Public sputtering out, and thus deeply keen to get a new “motor” up and running.

• Alternative energy is the “motor” candidate for which all the right boxes are checked. There is moral authority (via global warming concerns); global buy-in (via the energy issues all non oil-exporting countries face); massive scale and scope (projects too vast for the private sector to handle, i.e. retrofitting tens of thousands of gas stations across the U.S.); and, last but not least, a genuine need for massive spending (many trillions for new and upgraded infrastructure).

From Pelosi to Eisenhower

We are likely to see more crisis spending in the days ahead. Like the war in Iraq, the final tally for government involvement in the global financial system will only rise and rise. (Unlike Iraq, however, there is at least the possibility that taxpayers will profit… but that’s a speculative notion, and a very long-term one at that.)

On October 8, House Speaker Nancy Pelosi gave a foretaste of this with her call for a $150 billion stimulus package aimed at Main Street rather than Wall Street. Assuming an Obama win, the Democrats are planning to hit the ground running on November 5. That means breaking out the checkbooks for Round Two (and Three, and Four, and so on).

If McCain wins, the spending outlook doesn’t change that much. He, too, has plans to bail out U.S. homeowners. A Republican White House paired up with a Democratic Congress might even touch off a “top this” contest to see who can be more generous.

Whoever wins, the U.S. budget is going to be busted like never before…. and it will not be long before the “Green New Deal” starts taking shape. As it does, do not be surprised to hear a buildup of references to good old Dwight Eisenhower.

Roughly one half century ago, President Eisenhower signed the Federal-Aid Highway Act of 1956. As a result, there are just under 47,000 miles of interstate highway crisscrossing the United States today. The longest stretch, route I-90, runs a full 3,000 miles across the continent.

Ike’s highway system was not at all cheap to build, and still costs upwards of $80 billion a year to maintain. But given all we’ve gotten these past 50 years, who will dispute it was worth it? The open road is an indelible part of American life and culture – not to mention the incalculable value of transport, or the millions of truck stops, burger joints and bedroom communities that sprang up on the new interstate.

From Roof to Shining Roof

When you start with Ike’s highways, it’s not hard to imagine the same type of grand vision applied to green energy solutions.

The soaring speeches practically write themselves. Just imagine it: Millions of proud, hard-working Americans climbing up on the roofs of their eco-friendly homes, installing the solar panels that will set them free from the burden of high energy costs, while leading an industry boom that restores and renews the nation.

Or picture fresh-faced toddlers waving from the back seats of biodegradable electric cars – cars built by American hands in freshly capitalized Ford and GM plants, designed to travel up to 300 miles per day on near-zero emissions, plugging into the natural gas and nuclear-powered grid at night to refuel. My Country ‘Tis of Thee, Sweet Land of Li-ber-ty…

OK, that was a little cynical. But you get the idea. If the US consumer is tapped out, then America — and the world — will need a new deal. So why not make it a green one? And on top of that… whisper it now… who wouldn’t mind another investment bubble (this time in alternative energy shares)?

Mind or not, we’re going to get one of those, too… a new bubble, that is. When the next mania comes, alternative energy is almost certainly where it will take root. Financial panics will come and go, just as they’ve been doing for thousands of years — did you know Wikipedia has an entry for “The Business Panic of 33 AD”? — but human nature never changes.

Who Pays for All This?

By now you might be wondering: Who’s gonna pay for all this stuff? Where will the money come from?

It’ll mainly be taxpayers, of course… the same people who always pay. But a mass investment wave in global green infrastructure will at least have some nice follow-on benefits. Like Eisenhower’s highways, we’ll get something solid in return for our investment — unlike the trillions that simply vanished into the maw of the great Wall Street housing bubble ponzi scheme.

Over-eager investors will also voluntarily pay a big chunk of the “green” bill, too. I speak here of those who will wind up plowing their money into the green tech bubble (once it inflates) at the very height of the boom, paying for excess capacity that plummets in price to become a cheap consumer good later.

In other words, excess capacity in the short run will lead to wonderfully cheap green energy in the long run. It will happen with “green tech” the same way things are playing out now with bandwidth. A few years back, bubble-hyped telecom investors fudged the profit calculations on thousands of miles of fiber-optic cable. In result, they were forced to sell their stakes at a blowout loss, leaving the cable in the ground for you and me to enjoy at low cost.

It’s an old historical pattern. We saw it even earlier with the railroad boom and bust. After the great railroad investment debacle, the trains and tracks were still there for the country to use. On the heels of the Green New Deal will be the Green Mega-Investment Bubble – and then, when that bursts, a wonderful glut of energy saving technologies on the other side.

But now we’re getting ahead of ourselves… There will be huge profits to be made on the run-up in all things green, likely sustainable for many years, before we circle back round to bust again. And so it goes.

Source: The Return of FDR, Part III: The Green New Deal

The industry received a boost when clean energy tax credits were added to the $700 bailout bill to help its passage from Congress. But fears of falling demand and oversupply have weighed on solar stocks. The Claymore/MAC Global Solar Index ETF (NYSE:TAN) fell 35% in the first eight trading days of October.

William Patalon III, however, says new mapping technology and advances that have made solar power more eco-friendly will boost solar stocks in the long run.

This from Money Morning:

The owners of homes and businesses in 25 US cities will soon be able to use a free website to determine their rooftop’s solar-energy potential – thanks to a new specialized mapping program that has the backing of the US Department of Energy.

Engineering giant CH2M Hill Cos. Ltd., an employee-owned firm with about $5 billion in annual revenue, has received a “small-but-noteworthy” contract of $6 million under the U.S. Solar America Initiative to provide raw data on solar-power potential, MarketWatch reported.

The contract will pay the expansion of the city of San Francisco’s recently posted solar energy map. It will use advanced 3-D modeling and aerial imagery and will be available for public access through a special web portal.

Punching an address into the city’s search engine pulls up data on the estimated amount of solar photovoltaic energy that could be installed on a specific roof. Additional available data includes the potential electricity-cost reduction and the potential reduction in dioxide/greenhouse gases, the company said.

The website also provides information on installing a photovoltaic system, including contact information for local solar installers.

David Herrmann, CH2M Hill’s director of client solutions, said the mapping program could potentially replace the current method of assessing solar energy potential.

“Right now, to get a solar assessment on a roof, you have to call up the solar installer, they bring their ladder, a guy wanders around on your roof, and two or three weeks later you get a report,” Herrmann told MarketWatch. “With this technology, you could do it accurately and quickly without having to roll a truck.”

Herrmann said the company’s solar maps use a format from Google’s (NASDAQ:GOOG) Google Maps to display the data, but that CH2M Hill collects the images through its own proprietary process with Esri Inc. – A Redlands, Calif.-based company that’s recognized as a leader in geographic information systems (GIS) also supplying technology for the effort.

The solar map is also compatible with the Microsoft (NYSE:MSFT) Virtual Earth display, he said.

Herrmann said the Internet-mapping business remains healthy, with companies routinely paying for airplane flyovers to provide panoramic shots of streets and buildings all across the United States.

The 25 cities for which this service will be available will include: Denver, Houston, Philadelphia, San Jose, Calif.; Santa Rosa, Calif.; Seattle; Ann Arbor, Mich.; Austin, Tex.; Berkeley, Calif.; Boston, New Orleans, New York City and Tucson, Ariz.

Also, advances in technology have made solar cell production even more eco-friendly.

A recent study by the Brookhaven National Laboratory in Upton, N.Y., found that for each unit of energy produced by solar cells, the pollution that’s emitted during the cells’ manufacture is only 2% to 11% the amount produced by power plants in the United States and Europe.

In fact, newly developed solar cells can “pay back” the energy required for their production in just one to three years. And improvements in manufacturing efficiency could reduce emissions from solar power by another 50% in five to 10 years, according to a recent report by Money Morning.

There have been tremendous advances in the production and efficiency of solar technologies.

And those advances couldn’t have come at a better time. Political support for the industry is at an all-time high as oil prices and environmental awareness both continue to rise.

The Englewood, Colo.-based CH2M Hill has 23,000 employees and ranked 54 on Fortune magazine’s 11th annual “100 Best Companies to Work For” list, a ranking that was published in late January. It’s the third time the company has ranked among those top-tier companies. CH2M Hill has also been recognized as a “Most Admired Company” by Fortune for the past five years.

CH2M HILL has been repeatedly recognized for its competitive compensation-and-benefits packages, employee ownership, and reputation for landing challenging projects, some the most recent include:

• Program management for the seven-year, $5 billion expansion of the Panama Canal.

• Overseeing the design and construction of the venues and infrastructure for the London 2012 Olympic and Paralympic games.

• The engineering and construction of the Xcel Energy Inc.’s (XEL) 580-megawatt gas-fired High Bridge Power Plant near St. Paul, Minn.

• Providing program management consulting services for the $2 billion improvement program for India’s Mumbai airport.

• Engineering services for the Southern Seas Desalination Plant in Perth, Australia, which will use “green” energy to supply 20% of that city’s water needs.
• Managing a $10 billion military-base-relocation program for the U.S. and South Korean governments

Alternative Energy Update: Can Your Rooftop Lower Your Electricity Bill?

Since then, however, concerns of oversupply have whacked solar stocks. This prompted Goldman Sachs (NYSE:GS) to downgrade several solar companies to a “sell”.

J. Cristoph Amberger says the current financial crisis will hurt investment in solar power. He recommends investors sell their positions while they still can.

This from Today’s Financial News:

Two key solar stocks are being hit hard in early indications. First Solar, Inc. (NASDAQ: FSLR) had already cut its 52-week high of $317.00 by more than half. Trading below $140 today (down 10%-plus), it’s still twenty bucks above its 52-week low of $124.96.

SunPower Corporation (NASDAQ: SPWRA), too, has been decimated. (In fact, “decimated” — meaning a violent elimination of a tenth! — seems too tame a term to describe what’s happened!) The stock is worth just a third of its 52-week high of $164.49, trading just above its 52-week low of $52 right now.

My own recent recommendation of Yingli Green Energy (NYSE:YGE) is down to $7.59 (-10.50% just today) for a total loss of -55.58%.

I do not believe the stock will double any time soon for us to break even on it. Goldman Sachs’ change of direction tell me we’re in for a sea change in the attitude toward solar companies in general, beyond the upheaval in the current market.

My original call on Yingli — which we had covered since its IPO back in the Taipan days — was motivated by expectations that Obama will win the election, unleashing a tidal flow of speculative money into “politically correct” investments. A flow triggered by the expectations of a Federal gravy train of subsidies that could make up for the economic shortcomings of solar energy.

That money may still be coming. But overall, I believe recent fascination with solar is a Prosperity Phenomenon. It’s the equivalent of a Levenger catalog (”Tools for Serious Readers”) or an Eagle Scout project marking storm drains in prosperous suburban neighborhoods with “Don’t Dump” stencils. (I did that last Saturday!)

Large-scale adoption of solar technology by consumers represents a huge investment. And currently, it doesn’t look like there will be excess play money lying around anywhere… or credit being extended.

Plus, there’s talk of a huge solar over-supply by 2010.

My recommendation: Solar technology is the new bio-ethanol. Sell while you still get money for your shares.

Source: The Death of Solar? Yet Another Bubble Has Popped!

Nevertheless, Jim Stanton says alternative energy — and the wind-energy market in particular — has a big future. Wind energy is already the second largest source of new power generation in the US, and it now has the backing of the much-hyped Pickens Plan.

Jim says two clean-energy ETFs that look undervalued right now are PBW and GEX. He also recommends FAN for a more wind-specific ETF. 

This from the Smart Profits Report:

With the steady climb of oil prices over the past few years, it’s become apparent that higher prices are here to stay.

As a result, the market has spawned dozens of new alternative energy stocks – and subsequently, ETFs devoted to the sector.

However, with alternative energy technology developing rapidly and sub-sectors like wind, solar, geothermal, bio-fuels, and bio-mass all springing into the headlines, it can be tough to know which stocks or ETFs an investor should play.

Fortunately, ETFs give you broad exposure and diversity to certain markets, with less risk than owning individual stocks.

For example, the two most widely followed alternative energy ETFs are the PowerShares WilderHill Clean Energy ETF (AMEX: PBW), which is mostly made up of American companies, and the Market Vectors Global Alternative Energy ETF Trust (NYSE:GEX), which gives you international exposure to some of the largest companies dealing in wind power.

In 2007, these ETFs turned in outstanding performances, chalking up gains of 62% and 50% respectively. And GEX may have done even better, due to the fact that it did not begin trading until May 2007.

In 2008, however, the funds haven’t been able to sustain that performance. As of September 26, PBW is down about 40% for the year, while GEX has lost 25%.

“Springing” Back To PBW

Back in the spring (March 24, to be exact), I highlighted the performance of PBW in my “Sector Watch” piece. At the time, the stock was trading around $21 and had recently tested its January lows. With the chart pattern still bearish, I said it represented a good short-selling opportunity.

Before it rebounded last week, PBW had traded below $15. But as long as oil prices remain high, ETFs like PBW should come back into favor. Moreover, after the beating they’ve taken this year, they look like good value.

That said, I don’t like trying to pick bottoms, so let’s take a look at the daily chart of PBW for more clues…

As you can see, the downtrend line drawn from the highs last December currently sits at $18.95. As time goes by, this number will go lower, but a couple of closing prices above this downtrend line will signal a change in trend – and that the stock is probably worth buying.

Profits From Thin Air

Between PBW and GEX, though, I actually prefer GEX, due to its higher exposure to the wind power segment. This fast-growing area is gaining some serious momentum and greater investment, thanks to the publicity that T. Boone Pickens is bringing. Pickens is a very smart businessman, who is investing billions towards the largest “wind farm” in the U.S. And you can see why he’s on board…

Wind power is the second largest source of new power generation in the U.S., surpassed only by natural gas.

• In 2007, wind provided enough power to satisfy the residential electricity needs of 150 million people.
• Capacity increased by a record-breaking 20,000 megawatts, which puts the world total at 94,100 megawatts.
• According to the U.S. Department of Energy, since 1980, the cost of producing wind power has declined by as much as 90%.
• Electricity from new wind power projects will be cheaper than electricity from new conventional power plants by 2010.

If you’re a fan of wind power, there is a relatively new ETF that deals strictly with the field. It’s called First Trust ISE Global Wind Energy (NYSE: FAN) and it began trading in June 2008.

Having hit a high of $31.50 in June, FAN has sold off, along with the other alternative energy ETFs. Earlier this month, it traded as low as $20, so let’s take a look at the chart to see what the next move might be…

With only a few months of data to go on, projecting the stock’s next move is a little trickier, but we have enough information to draw a regression channel from the June highs. The upper band of the channel is currently around $24.15 and a couple of closes above that level should lead to higher prices for the stock. We’ll keep an eye on this one, as wind power continues to gain traction.

PS. Yesterday, Oxford Club’s David Fessler described how the quiet passing of an $18 billion clean energy bill could mean ‘big moves’ for FAN and two other clean energy ETFs.

Source: Forget Washington’s Hot Air… Here’s How to Really Profit from Wind

But an even bigger problem has been the coming expiration of energy tax credits for the manufacturing, production and use of alternative energy systems and devices at the end of 2008. This situation has now changed with the $18 billion Renewable Energy and Job Creation Act of 2008.

David Fessler at Investment U says three alternative-energy ETFs should see “big moves” in the remainder of 2008 and in 2009 on the back of the bill.

Although the House of Representatives still has to approve this version of the bill, once they do the President has indicated he would quickly sign it into law.

Here are some of the bill’s highlights:

• Tax credits for wind generation facilities would be extended through 2010.
  
• Tax credits for solar, geothermal, marine (tidal) and biomass, municipal solid waste, trash combustion and hydro power plants would last through 2011.
  
• Residential energy efficient property tax credits would run through 2014, and the bill allows for up to $4,000 of solar energy tax credits for homeowners who install such systems.

Here’s one bound to get automakers excited: A new tax credit for the production – and purchase – of plug-in electric vehicles.

It’s been estimated that existing hybrid vehicles can be converted to true plug-in hybrids for an additional $3,000 to $5,000, and this credit might just be the catalyst that gets big automakers moving.

Felix Kramer, co-founder of CalCars.org – an organization which promotes plug-in hybrid electric vehicles – thinks it will happen: “This will have an enormous impact, and could conceivably entirely remove the cost increment that carmakers say is the cause of their reluctance to build plug-in vehicles.”

And car buyers come out big, too. If you purchase a plug-in car or truck, your credit could be as much as $7,500.

Other provisions of the bill provide tax credits for installing non-hydrogen alternative fuel refueling stations. Biofuels, anyone?

One provision even allows you to deduct your bicycle commuting expenses from your gross income. Being a cyclist, I’m particularly fond of that one.

The previous legislation was primarily focused on residential and manufacturing credits for solar. While they’re still included, the new bill goes a lot further, allowing utilities to take advantages of the credits, too, and in the case of solar, extends them for up to eight years.

Three Ways to Profit

This will likely jumpstart a wave of green power plant construction projects and the bill includes $800 million in bonds to help fund them. However, existing green-power producers win as well, as the bill extends production tax credits for another year for wind and for two years for solar, biomass and hydropower.

Thinking about installing solar panels on your home’s roof? Now might just be a good time to get started, as the bill extends solar investment tax credits for homeowners to eight years, and removes the existing $2,000 cap on the credits.

And if you live in the Midwest where the wind is nearly constant, you might want to consider your own wind-driven power plant. The bill includes a $4,000 credit for homeowners who install small wind generators for power generation.

Of course, there’s always the issue of how tax credits will be paid for. It was initially envisioned as a tax on oil and gas producers, but that might have killed the bill. Instead the IRS is delaying certain tax deductions for these producers, which has a net effect of having them pay for it anyway.

Clearly wind and solar companies will be big beneficiaries of this bill. Last week, we talked about the Market Vectors Global Alternative Energy ETF (NYSE:GEX) as a way to play the entire alternative energy space.

However, if you want to focus specifically on wind power, there’s the First Trust ISE Global Wind Energy Index Fund (NYSE:FAN). For the solar buffs, there’s an ETF made up entirely of solar companies, the Claymore/MAC Global Solar Index (NYSE:TAN).

All three of these ETFs should be big movers in the remainder of 2008 and 2009 as alternative energy companies begin to gear up production as a result of this exciting legislation.

Source: Alternative Energy Gets a BIG Green Light… 

Goldman Sachs (NYSE:GS) is buying up tens of thousands of acres of empty Nevada desert. And industry experts forecast a $45-billion market developing over the next decade, with Nevada at the heart of it.

As momentum builds, Justice says there will be big profits up for grabs for investors with their fingers on the pulse.

There’s something big going on out west. Some think of it as a new “gold rush” – and the biggest profit opportunities are still yet to come. Did you know that the great state of Nevada is pretty much empty?

And most of that empty Nevada land is federally owned – more than 85%. (Alaska comes in a distant second, at roughly 67%.)

If you don’t live here, it’s hard to get a sense of how big and open the West is. (Did you know, for example, that Reno-Tahoe is an eight-hour drive from Las Vegas? Back east, that’s enough driving to cut through three states.)

So all this begs an odd question: Why in the heck is Goldman Sachs, a hot-shot New York investment bank, buying up tens of thousands of acres of empty Nevada desert? What do a bunch of East Coast city slickers care about sage brush, rattlesnakes and coyotes?

For the answer to this question, look just a little further west to Nevada’s neighbor state. California’s barren Mojave Desert is ground zero for this new phenomenon that has a whole host of deep-pocketed players scrambling. Their goal? To make huge amounts of money, of course… but to do it by providing the 21st-century answer to America’s electricity needs.

The reality is there’s not much you can do with empty desert. For the most part it’s too hot and too dry to grow crops. But there is one harvest the desert offers bountiful amounts of, day in and day out: sunshine.

The West’s endless rolling stretches of cracked, dry hardpan are the perfect place to put up huge solar mirrors by the thousands. Out here, mass-scale solar installations can follow the arc of the blazing hot sun from dawn till dusk. The systems are pretty much self-contained, so maintenance workers only have to drive out every so often to check on things. As a long-term energy solution, the setup is almost perfect. (Key emphasis on “almost,” as you’ll see in a moment…)

This explains why Goldman has staked a claim to 40,000 acres of empty Nevada desert – and why the bank wants to buy more. Utility companies, silicon valley start-ups, European and Israeli energy firms… all are pushing hard to buy up available Western land.

“Diamond Falls Trade” Could Deliver 393%! As the market plunges into bear territory, one group of investors are racking up gains at a blistering rate. In fact, since January 2008, they’ve racked up 26 winners out of just 28 tries for total gains of2,680%. And here’s the best part: They just isolated their next trade. It could deliver 393% in 12 weeks. Follow this link for all the details…

As the competition heats up, bidding wars are breaking out. Fortune magazine calls it a “solar gold rush,” noting that “it’s not just a federal land grab either. Buyers are also vying for private property. Some are paying upwards of $10,000 an acre for desert dirt that a few years ago would have sold for $500.”

The thing is, as empty as the West is, most of that prime desert land is still off-limits to solar development (or any kind of development for that matter). The BLM, or Bureau of Land Management, is notoriously slow in granting requests for new solar sites.

And hardcore environmentalists – the “eco-warriors” who should be more enthused about solar than anyone – are turning out to be a big obstacle to new solar sites. Rightly or wrongly, their concern for protecting desert habitats and rare plants and species makes it very hard to get approval. This is why the few uncontested sites are being snapped up fast. If you can get your hands on 10 or 20 square miles with no rare cacti or tortoise tracks, your solar site can be up and running that much faster.

So how can you and I profit from this?

To be frank, you don’t want to mess with buying desert land. That’s an expensive, labor-intensive game that requires millions of dollars (preferably tens of millions), mountains of paper work and dedicated scouts to eyeball all the potential sites.

The good news is, this “solar gold rush” is just the preliminary stage of something much bigger. That’s why industry experts at Emerging Energy Research of Cambridge, Mass., think “Big Solar” could become a $45 billion market over the next decade or so.

When the solar power industry reaches a certain “tipping point,” you’re going to see a snowball effect kick in. It may in fact be happening right now.

In the early stages, it’s very hard for a new industry – especially an energy-related industry – to get a real foothold. It’s a kind of classic “chicken and egg” problem. Without strong demand, there isn’t enough support to build out the new industry at a viable scale. But without pre-existing industry support — factories, maintenance workers, tried and true technology and so on – there isn’t enough infrastructure backbone to justify strong demand.

The only way to get around this Catch-22 is to move forward slowly, inch by inch… until some kind of breakthrough happens. Maybe a new manufacturing process changes the game. Maybe economies of scale kick in just enough to start building momentum. Or maybe demand trends pick up enough to start generating a positive feedback loop, which in turn creates more and more demand.

Whatever the catalyst, when a new industry finally breaks through and hits critical mass, what comes next can be very exciting. News stories like this one, from The New York Times just a few weeks ago, shows that the solar “tipping point” is on the verge of being reached:

In recent months, chains including Wal-Mart Stores, Kohl’s, Safeway and Whole Foods Market have installed solar panels on roofs of their stores to generate electricity on a large scale. One reason they are racing is to beat a Dec. 31 deadline to gain tax advantages for these projects.

So far, most chains have outfitted fewer than 10 percent of their stores. Over the long run, assuming Congress renews a favorable tax provision and more states offer incentives, the chains promise a solar construction program that would ultimately put panels atop almost every big store in the country.

Here at Taipan, our editors are well placed to book profits on this booming solar mega-trend. We’ve already seen some powerful gains, but those are just the beginning… Rest assured, there will be much bigger gains to come.

Source: Why Does Goldman Sachs Own 40,000 Acres of Empty Nevada Desert?

Worley Parsons says it wants to build 34 250-megawatt power stations in Australia by 2020. Now that is real vision! The goal is to provide alternative power to industrial customers in WA, who are currently vulnerable to any disruptions from the natural terminal at Varanus.

Australia is the buckle on the global sun belt

Source: Worley Parsons

As you can see from the image above (taken from Worley’s presentation to investors on its plan) Australia is in the world’s “Sun Belt.” As we’ve said in this space before, getting more energy from sun is one of the key challenges of Peak Oil.

By the way, our technical analyst Gabriel Andre, who has studied energy and engineering (along with currencies and trading) tells us that the X axis is the longitude (in degrees West and in degrees East from Greenwich meridian, while the Y axis is the latitude (in degrees North and South from the Equator). For the data in colours, what you see is solar radiation per annum, in KW/H per M2, which is the total amount of beam radiation that you receive from the sun on a particular area.

Got that?

One more note on this. Worley Parsons wants to use solar thermal technology, not solar panels. It’s a subject we’ve covered in the Australian Small Cap Investigator (although the best Aussie company at it is now doing business in America and is not publicly listed). It’s part of the “portfolio of energy experiments” we’ll need to produce energy in the future.

The trouble with silicon based photovoltaic panels is that there’s a limit to how much of the sun’s light they can convert into electricity. Experiments in thin film solar panels and in materials science (a kind of artificial photosynthesis that converts more light into energy) are designed to improve the efficiencies of photovoltaics. But progress is slow.

Solar thermal produces electricity, but uses sunlight to produce heat, which then produces electricity. Solar thermal concentrates the sun’s rays to superheat a fluid, which is then used to drive a turbine to produce electricity. The nice thing about it is that the superheated fluid can be stored, which means a solar thermal power station can operate at night, when the sun is not shining. It’s a great idea, and great to see Worley Parsons moving on it.

P.S. Solar investors may also want to check out J. Christoph Amberger’s ReneSola (NYSE:SOL) recommendation. He says strong quarterly earnings for Chinese solar maker LDK Solar (NYSE:LDK) indicate an immenent run-up for ReneSola…

Source: Worley Parsons (ASX: WOR) Announces Pilbara Solar Energy Project

Quarterly earnings tripled for Chinese solar maker LDK Solar (NYSE:LDK) on soaring demand for solar power, while ethanol producer Pacific Ethanol (NASDAQ:PEIX) reported a wider-than-expected loss on surging corn prices.

J. Christoph Amberger in Today’s Financial News says these results create a great opportunity for investors. Yesterday, shares in LDK Solar rose 15 percent. And J. Christoph reckons solar maker ReneSola (NYSE:SOL) may now do the same…

LDK Solar apparently is coping quite well with the proposed loss of German subsies. The company reported Q2 revenues surging 89.2% to $441.7 million after total wafer shipments increased 60.8% during the quarter. Gross margins ended up at 25.4%. (Obama, are you listening?! Can you spell “windfall profits”?)

LDK expects revenues between $486 million and $496 million on shipments of between 210 megawatts and 220 megawatts of wafers in the third quarter: “The company also lifted its full year guidance to between $1.65 and $1.75 billion compared to between $1.08 and $1.18 billion earlier.”The stock is still trading well below its 52-week high of $76.75. The stock gained over 17% today.

While most other publicly traded solar companies were gaining today, one in particular stood out: RenaSola another Chinese wafer maker, announced that it would report unaudited Q2 financials on Tuesday, Aug. 19, before the market open. The stock gained over 11% to trade at $15.36.

Call me crazy, but those earnings just might be something!

We’ll play: Buy RenaSola between $15-16 in view of an earnings-induced bounce of another 20% by next Tuesday.

Source: ReneSola is Our New Solar Earnings Speculation