Andrew Ling

Solar Power Will Be Transformational in the Next Decade

Supershort you're missing the point completely. A major reason the economy is in such bad shape is due to rising energy prices which benefits solar stocks. Would you also short agricultural stocks, energy, and mining due to the economic downturn?

Trina Solar: Best Value in the Solar Space

Also, all the debate your hear about silicon supply and pricing, government subsidies, new cigs entrants, solar's viability vs other renewables etc are all really arguments about whether future earnings will be better or worse than expect. 2009 silicon prices has a direct impact on 2009 and 2010 earnings of all solar stocks, and therefore effects today's stock price. Whether solar's market share vs wind in 2030 is a sort of 2030 earnings debate, with far less effect on today's share prices. The only reason that the dramatic stock movements are cause by things such as current and next quarter's earnings is because 2009 earnings change very gradually. They determine the intermediate term performance of the stock.

Trina Solar: Best Value in the Solar Space

Ignoring 2009/2010 earnings is a big mistake. 2009 earnings on what today's stocks will be primarily trading on. Even if you find the analyst's estimates unreliable you should at least use 2007/2008 earnings and growth rates to extrapolate 2009 earnings. In Feb. 07 FSLR analysts called for 0 08 earnings. I speculated $1.50 08 earnings and bought the stock. The rest is history. If you ignore them you're just throwing darts at the Wall Street journal. Just because speculation is difficult it doesn't mean you shouldn't speculate at all.

Solar Power Will Be Transformational in the Next Decade

Also, consider the adoption of past comparable technologies. In order to displace an old technology it's not enough for the new technology to be equal. It has to be far superior. I've always been an early adopter, one of the first 1% to switch to a new technology e.g. dialup modem to broadband, film to digital cameras, cds to dvds to blu-ray. But there is a major lag between when a product seems clearly superior to me and other early adopters and when the general public finally switch over.

A good example of this is the number of HDTVs that were still flying off the shelves last year that were NOT 1080p capable. By the year the prices for 720/1080i and 1080p were already comparable. People just weren't aware what 1080p was.

Another is when Intel introduced the Core Duo. Everyone that reads benchmarking sites knew this was the end for AMD. After a decade of having a superior product but being barely able to compete with Intel they now had an inferior product and nothing in the pipeline. The market is still discovering this as proven by the fact the entire market sold off when AMD missed but then rallied when Intel beat. This was to be expected.

Solar Power Will Be Transformational in the Next Decade

Jack, using solar water heaters as a example, just because a technology is economical doesn't mean it will catch on quickly. Solar water heaters are such a great value and have been for decades. But relatively few in the States have one. Then again, the Toyota Corolla is probably the most economical car on the market but again
it's not even the best selling car in the country.

Most of us agree that solar will take the lion's share of new energy generation 30 years from now due to economics, but how much share it has in 5 years will depend highly on the whims of people and governments.

When Will Solar Achieve Grid Parity? We're Already There!

I understand your point Jack I've done the math myself numerous times. The problem is that the $1.8B coal plan is a one of a kind project. They can surely build "clean coal" plants for less if motivated or forced too. How much does a conventional coal plant cost to build?

At present time comparing conventional forms of generation with renewables is like apples to oranges. Either the apples (dirty fuels) need to be hindered so people choose oranges or the oranges (renewables) need to turn into apples by competing on cost alone regardless of emissions.

When Will Solar Achieve Grid Parity? We're Already There!

Governments are going the wrong route in subsidizing solar. The correct way to go is either subsidizing research directly or creating a government backed loan program. People don't want to pay $30K upfront for a PV system. Nor do they want to pay $20K up front with subsidies. Subsidizing research directly would maximize benefit to the public whereas finance subsidies would have a major impact on sales and maximize benefit to investors.

When Will Solar Achieve Grid Parity? We're Already There!

The problem is you're assuming utilities care whether their energy generation is clean or not. It's unbelievable to me that energy companies besides BP haven't jumped all over technologies like solar. Big oil has the most to benefit from renewables since they get the bonus propaganda boost which the pure plays don't need. It's also the perfect marriage because big oil has nothing to invest in with little oil left to be discovered in the world. The most likely reason is that big oil has an aversion to renewables and an us vs them mentality.