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Mark Henwood

 
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  • How A Romney Presidency Could Destroy Alternative Energy Investing [View article]
    I don't know that it matters much who wins. Alternate energy investing in the US is largely targeted at electric generation which is dominated by coal and gas. With shale gas driving gas prices to low levels, gas fired electric generation is cheap and the biggest, by far, threat to alternative energy. Transportation almost exclusively uses oil. Only ethanol and few biofuel technologies are in this space. They've been worked on for years and I'm not seeing enough progress for alternates to compete with shale oil and every-improving auto technology. At least the current subsidy levels aren't enough to make anything happen. And as investors, did you know that if you bought TAN at inception for $10 in 2008 you now have 16.8% of your investment left.
    Oct 1 12:14 AM | Likes Like |Link to Comment
  • EV Dreams And Industrial Metal Nightmares [View article]
    John,

    To date there has been little incentive to improve recycling technology for the materials in lithium-ion batteries. As with oil production, shale production, IC engines, and everything else, this technology will improve and conclusions drawn on the current state of affairs will undoubtedly prove wrong. Would your thinking change if the recycling tech got 10x better/less expensive?

    Mark
    May 8 11:56 PM | 1 Like Like |Link to Comment
  • Natural Gas In 2012: Electric Generation Switch Implications [View article]
    There are limits to how much coal can be displaced. Back in the day my analytic team could answer that question in an hour but my guess is we already are displacing alot of what's feasible. That said I hope you are correct about gas prices firming. If the current price levels persist the renewable electricity business's days are numbered.
    Apr 25 01:03 AM | 3 Likes Like |Link to Comment
  • Who Will Benefit From Shale Gas? [View article]
    BTW, you can see current electric prices at the Intercontenental Exchange (http://www.theice.com) in the OTC markets. The price I referred to is the mid-C off peak price for November 2011 at closing on Friday Oct 7, 2011.
    Oct 9 02:04 PM | Likes Like |Link to Comment
  • Who Will Benefit From Shale Gas? [View article]
    George,

    General Electric is offering their "FlexEfficiency* 50" 510 MW combined cycle (CC) powerplant with a baseload (full power) efficiency of 61%. This type of plant uses a gas turbine driving a generator and then take the exhaust of the turbine into a boiler with drives a steam turbine/generator. These plants became common in the 1980s and has been widely deployed in the US. In the western US there are over 45,000 MW of CC plants.

    One kWh of electricity is the equivalent of 3412 Btu of heat. Divided by the 61% efficiency give a "heat rate" of 5593 Btu/kWh. This is a common measure of power plant efficiency in the US and when multiplied by a fuel cost, say $4/Btu for gas, turns into an electric cost of 2.4 cents/kWh (after some unit conversion) .

    In the western US wind tends to generator more at night and at night electric prices in the WECC (Western Electricity Coordinating Council) are set by combined cycle plants which are operating at the margin. The November contract for offpeak power settled at 2.43 cents/kWh (=24.3 $/MWh) ....clearly a price determined by combined cycle plants.

    The levelized cost of a plant is a way of comparing different fuels and technologies and converts the future stream of capital, operating, and fuel costs into a flat "levelized" cost with the same net present value. The US Energy Information Administration publishes an Annual Energy Outlook containing their most recent estimates for levelized costs (DOE/EIA -0383(2010)). In December 2010 the advanced combined cyclec cost was $63.1/MWh and onshore wind was $97.0.

    Hope this helps.

    Mark
    Oct 9 01:59 PM | Likes Like |Link to Comment
  • Commodities Haven't Really Fallen That Far [View article]
    If you are looking at an energy heavy commodity basket like the PowerShares DB Commodity Index Tracking Fund ETF (DBC) which has fallen YTD 5.88 % you're right the drop isn't that significant. But a broader based basket of commodites, the iPath Dow Jones-UBS Commodity Index Total Return ETN (DJP) has fallen a significant 14.35% YTD....more then the S&P 500 and the EAFA index.
    Oct 6 08:05 PM | Likes Like |Link to Comment
  • Solar Investors Feel The Heat [View article]
    Correction....it is Evergreen Solar, Inc. [ESLR] that has filed for bankruptcy, not Energy Conversion Devices.
    Aug 24 12:01 AM | Likes Like |Link to Comment
  • Subsidy Woes Continue for Solar [View article]
    I agree this type of sharp price movement creates potential trading opportunities...I think this is where some of the bigger trading profit potentials lie in the clean energy biz. But before diving in you need to dig around to see if it truly is an overreaction.
    Jul 2 12:31 AM | Likes Like |Link to Comment
  • Wind Power Investors Get Another Reality Check [View article]
    Yep, wind developers only care about making money. The purchaser of windpower cares (sometimes) about how it fits into their economics. If it's cheap enough, after "smoothing" then wind developers will find markets. So what if it's intermittant.

    Cheap natural gas, on the other hand, may take the wiind out of the sales of the wind producers, at least in the US, or so says Iberdrola's boss.
    May 27 01:11 PM | 1 Like Like |Link to Comment
  • Wind Power Investors Get Another Reality Check [View article]
    John,
    What do your graphs have to do with whether wind companies are good investments? Wind isn't viewed as a souce of capacity, just as an energy source. In the BPA case, the variability really isn't important given the massive amount of hydro storage BPA has to schedule around the wind resources.

    The real issue is can wind + a CT to firm it produce capacity and energy cheap enough to compete with capacity and energy from a combined cycle plant. If so, developers will choose the wind / CT solution.
    May 26 11:39 PM | Likes Like |Link to Comment
  • Income Investors: Owning Dividend ETFs vs. Owning the 'Real Thing' [View article]
    You might appreciate what Fama and French have to say on this topic: www.dimensional.com/fa...
    May 23 09:54 PM | Likes Like |Link to Comment
  • Income Investors: Owning Dividend ETFs vs. Owning the 'Real Thing' [View article]
    I don't get it, why invest in dividend paying stocks for income? They are stocks, after all and their return is the dividend + the change in price. Basically dividend are just another screen to find value stocks. If portfolio isn't generating enough income to meet withdrawal needs, rather then tilting it more towards equities by shifting from FI to dividend stocks, I think it is better to augment the income by selling off a bit of equity.

    BTW, SDY returned -16 % on price in 2008... not what an income investor is looking for.
    May 23 02:45 PM | 1 Like Like |Link to Comment
  • Grid-Based Energy Storage: Widely Misunderstood Challenges and Opportunities [View article]
    The problem with the ESA discussion is it ignores the amount of energy the storage system would have to deliver....in the example I worked up a 1kW storage system that could run for 3 hours costs $750/kW. The costs would become much greater if the utility wanted the system to be able to handle load over a longer period....which I strongly suspect would be necessary. This doesn't consider the O&M cost of the device which would be greater than 0.

    Back to power quality, which requires small amounts of storage, as the best use for grid-storage.
    Mar 25 10:18 AM | Likes Like |Link to Comment
  • Grid-Based Energy Storage: Widely Misunderstood Challenges and Opportunities [View article]
    Improving power quality doesn't require a lot of stored energy so there is potential for the grid-storage companies to actually provide solutions. I'll check out Active.

    T&D upgrade deferrals would probably require lots of energy to back up the solution. Let's do a little analysis. Say we have a 20MW substation that has outgrown its capacity and is facing a 20% (4MW) potential overload for a 3 hour period. To meet this with storage would require 12,000 kWh of storage. If storage costs are in the 250 $ kWh range the storage alone would have a $3 million price tag or $750/kW for a source that only runs 3 hours. I'm sure expanding the substation would be much more cost effective and reliable.

    I'm back to the only promising solution for "grid-storage" is power quality (or pumped storage in the right situation). And for this application is "grid-storage" really the right label?
    Mar 25 02:44 AM | Likes Like |Link to Comment
  • The Treasury sells $11B in reopened 10-year TIPS at 0.92% (.pdf). Bid-to-cover ratio of 2.97, vs. a recent average of 2.79; indirect bidders take 25.2%, vs. a recent 44%. Direct bidders take 7%, vs. a recent 2.5%.  [View news story]
    .92% on the 10 year isn't bad for the Treasury. They almost hit the bottom on this latest dip in TIPS returns which occured 3/17 at .82%.
    Mar 24 01:24 PM | Likes Like |Link to Comment
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