Jason Liu

http://financialmusings.wordpress.com
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    • Wed Aug 27th 10:58 AM | Rating: 0 0
      Commented on:
      Solar Generation Costs on Track to Achieve Grid Parity
      Thanks for the correction WOV. Didn't consider the advantage solar has due to its competition being the retail electricity market rather than through commercial power generation

      On a different note, if I were signed up for any GREs, I might still be able to pass: "For the reasons stated below, I believe that solar power generation is on track to achieve grid parity in the next few years without the consideration of any government subsidies."
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    • Wed Aug 27th 10:03 AM | Rating: 0 0
      Commented on:
      Ethanol: Our Answer to Reducing U.S. Dependence on Foreign Oil
      While biofuels are currently still the only viable replacement for oil, few people believe that ethanol derived from food-based feedstocks (e.g. corn) is the answer to the energy problem. Its just too dependent on subsidies and inefficient to boot (there's a neutral energy balance for corn).

      What is the future is cellulosic ethanol (which uses non food-based feedstocks) . Energy balance and yields are significantly higher than traditional ethanol with the only problem being the expensive conversion process. That's why the U.S. DoE and companies such as POET are investing so much money into developing cellulosic ethanol. With government policies such as ten in twenty, ethanol will continue to grow in the U.S., but more so the 2nd generation biofuels such as cellulosic ethanol and BTL biofuels rather than traditional biofuels.
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    • Wed Aug 27th 09:48 AM | Rating: 0 0
      Commented on:
      Solar Generation Costs on Track to Achieve Grid Parity
      Sorry but this article is littered with conceptual flaws. The main one being that levelized cost is used for all forms of power generation and is the way utilities look at projects. For an engineer you don't seem to have a solid grasp of how power generation works.

      How does solar compare? The levelized cost of coal energy ~0.07/kWh. Wind ranges from $0.07/kWh to $0.12/kWh depending on the wind resource.

      Like you I believe that solar is the solution to a lot of our energy problems. But pulling random numbers and claiming that they will be competitive in a few years without government subsidies is not only naive but detrimental for the industry.

      For solar to reach grid parity, its necessary to have commercial solar installations as they cause cost reductions through (1) economies of scale, (2) learning in production, installation and O&M. And this isn't even considering the problem of grid integration. Without government support, solar will never be able to do reach grid parity.
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    • Fri Aug 22nd 09:00 AM | Rating: 0 0
      Commented on:
      2 New Wind Energy ETFs: A Comparison
      To add to your comment about country exposure, it also introduces an element of foreign exchange risk.
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    • Mon Aug 18th 09:00 AM | Rating: 0 0
      Commented on:
      U.S. Geothermal, Inc: A Solid Geothermal Pure Play
      I agree with most of what you've said, geothermal is a sector that has been mostly ignored by the mainstream media and a promising industry to get into. Its levelized cost of electricity is cost competitive with coal and natural gas, and as you said, provides baseload power meaning power and utility companies are desperate to have them on board.

      One company that you missed out on is Polaris Geothermal (PGTHF.PK). Unlike the rest of the geothermals, there is increased geopolitical risk. Its current project is located in Nicaragua and future development plans are centered around sites in South America.

      However it more than makes up for this through its high quality sites. Geothermal to a certain extent is a real estate play, access to sites with a strong geothermal resource will decide future cash flows.

      Polaris Geothermal's San Jacinto site has one of the largest geothermal resources in the Western Hemisphere and with its production wells showing higher than expected resource and temperatures, the company seems to be a solid addition to any geothermal portfolio.
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    • Mon Aug 11th 09:50 AM | Rating: 0 0
      Commented on:
      Hydropower: The Renewable Energy Elephant in the Room
      The problem with large hydro is that there are few economically feasible sites left, along with the environment damage damming can cause. As you also brought up, large hydro projects are mostly pursued by public utilities.

      Small hydro is where most of the growth lies. Unlike its larger counterparts, there is minimal enviornmental impact and plenty of potential sites. Best of all, its easy to invest in as there are numerous publicly listed small hydro developers. Some of the Canadian examples include Run of River Power Inc. (TSXV: ROR), Plutonic Power Corp. (TSX:PCC) and Synex International (TSX:SYI).
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    • Thu Aug 7th 09:00 AM | Rating: 0 0
      Commented on:
      Wind Turbines: The New Renewable Bull Market
      I was just wondering where you got your source for market share figures as I've seen vastly different numbers.

      I'm a strong supporter of wind energy but I think a lot of the wind turbine manufacturers seem over-valued.

      1. Their growth isn't decided by the demand, but by their manufacturing capacity. So the projected growth in the wind industry won't directly correspond to Vestas' fortunes.

      Many smaller manufacturers are eating to Vestas' market share because the firm can't keep up with demand. And if Vestas does ramp up production, earnings will take a hit from the capital investment.

      2. Growth is mostly going to originate from India, China and the U.S. where GE, Suzlon and Goldwind/Sinovel are strongly entrenched. In fact Chinese law decrees that 70% of hardware used in wind farms must be sourced from domestic manufacturers making it difficult for foreign companies to break in.

      This will hurt Gamesa more than Vestas. Gamesa has benefited from the strong home market with 54% of revenues originating from Spain. However it'll have to really ramp up production elsewhere to keep growing and as you said, they've secured their first order from China in 2 years, despite China building 5.6 GW of wind energy capacity in that time.

      Both Vestas and Gamesa are great companies. Unfortunately that doesn't mean they're great investments.
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    • Wed Jul 16th 15:37 PM | Rating: 0 0
      Commented on:
      SEC: Don't Mess with Market Mechanics
      "Naked short selling is not necessarily a violation of the federal securities laws or the Commission's rules. Indeed, in certain circumstances, naked short selling contributes to market liquidity."
      www.sec.gov/spotlight/...

      Ironically, banning naked short-selling of the brokerages actually keeps your " finance industry [which] generates no economic benefit as an industry in the political economy" alive.

      The markets are there to allocate capital efficiently. Manipulation of stocks, whether up, or down is always detrimental. However, preventing people from making directional bets is never a good idea.
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    • Mon Mar 10th 18:22 PM | Rating: 0 0
      Commented on:
      Goldman's a Buy Heading Into Earnings
      Around 1/4 of GS' originates from investment banking. With the markets the way they are currently, that business at least will definitely take a hit.
      Furthermore while Goldman Sachs hasn't had any write downs, there have been fears that some of the SIVs may have to be written off this quarter. That along with how well GS' traders have done, accountable for 2/3 of their revenue, will decide how well GS does this quarter.

      I'm also of the opinion that you can't really use P/E ratios to value financial stocks right now due to the absurd write downs taken. These non-recurring charges artificially inflate the P/E ratio and make the banks seem a lot more expensive than they really are.
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    • Tue Feb 26th 20:33 PM | Rating: 0 0
      Commented on:
      Is the Malaysian Stock Market Due to Fall?
      Due to EWM's holdings, it hasn't dropped as much as the KLSE. However if exports are dropping, as they have already, the economy will decline and this will in turn affect domestic demand and cause the price of EWM to drop. Just as everything in America drops with the threat of a recession, the same thing will happen in Malaysia.
      View article »
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