Andrew Ling

The Year Ahead For US Wind

Wind is cheaper than solar as of this moment, but not by much. As you mentioned a 1MW turbine costs about $2 million or $2/watt. FSLR's systems are $4/watt installed. However, wind has very high maintenance costs. About 1 in 10 turbines you see in Europe will be non operational. Also, wind generates most of it's energy late night and early morning. Electricity is less valuable off-peak. Solar obviously generates it's electricity during peak hours when it's the most valuable. The main reason investors prefer solar though is the often quoted fact that module prices have fallen 7% a year for the last 40 years on average. Wind turbine prices have barely budged. This is why most expect solar to be the primary alternative energy source in 20 years time.

Additionally, the only predictable wind plays at the moment are the turbine manufacturers such as Vestas and Gamesas who are not traded on US exchanges. A carbon fiber manufacturer such as Zoltek is no more a wind play that a polysilicon producer such as MEMC is a solar play. AMSC is a small cap with no earnings. This week's price movement shows you the risks involved with these stocks. FSLR, which I have owned for 18 months, has never dropped double digits in a single day despite how overvalued many people claim it to be.