GREEN DEALS: Clean tech cheer

The Elon Musk-backed SolarCity IPO offers a rare good news story among clean tech stocks. Elsewhere, the defrauding of Suntech becomes clearer, Carnegie makes progress at its flagship project and EnviroMission signs an MOU in Texas.

SolarCity

There’s been plenty of talk about the struggles of clean energy stocks in the past few years, which makes a good news story like SolarCity worth talking about. The leading installer of residential solar systems in the US saw its stock price surge 47 per cent, to $11.79, on its opening day of trading.

A very positive display, although dampened by the fact that the company had initially sought to price its IPO at $13 to $15 per share instead of the $8 it settled for. The company’s primary struggle came from convincing nervous investors about the prospects for its stock given the many clean tech stocks that have burnt investors.

But while they may not have been convinced before it started trading, they were seemingly won over when it began trading. At one stage the company’s stock was up 58 per cent.

Of course many clean tech stocks have started off life on the stock exchange quite well, only to fall back in the years after, but the backing of entrepreneur Elon Musk has investors hopeful it can buck the trend.

Musk, for those unfamiliar, is the founder of electric car company Tesla Motors, one of the few clean tech stocks to have a healthier share price and better prospects today than it did two years ago. Musk is also famous for the role he played in Robert Downey Jr’s portrayal of Iron Man, with the superhero based to a degree on the entrepreneur.

Back to SolarCity, and its story is one of rapid growth. It has been one of the more innovative installers, offering consumers the ability to lease solar panels by paying a monthly fee, rather than paying a hefty up-front amount.

"We don't manufacture equipment, we sell cheaper clean energy. I thought that that would be enough to convince investors to look at the fundamentals of the business," SolarCity Chief Executive Lyndon Rive said in an interview, according to Reuters.

Carnegie Wave Energy

Carnegie has ticked off another milestone for its flagship Perth Wave Energy Project, receiving environmental and maritime safety approvals.

The approvals will allow construction to begin in the first quarter of 2013. Before then detailed design must be completed, with the company expecting this to be done before the end of the year.

Suntech

Chinese-based, US-listed solar maker Suntech Power Holdings has said an internal analysis has found that it indeed was defrauded – to the tune of over $60 million – as it warned a few months ago. 

The company consequently reassessed its 2010 net income down between $60 and $80 million, with the final figure to be determined in early 2013.

The fraud relates a minor shareholder in an investment fund of which Suntech was the major shareholder with 80 per cent.  According to Suntech, GSF Capital, a 10 per cent stakeholder in the fund, provided a security interest in the form of German bonds that did not exist.

Suntech made the announcement on Friday (US time) at the same time as it issued its third quarter results, with revenue down 18 per cent. The company also downgraded its shipment forecast and said its gross margin will fall into negative territory in the fourth quarter. It was a skinny 5 per cent in the third quarter.

The news did get a little better for Suntech shareholders this week though, with China announcing fresh subsidies and reports that the country will double its solar capacity target for 2015. The developments sent the company’s stock soaring 10 per cent on Wednesday night, before it gave up 3 per cent last night. At 96 cents a share it still remains well below its year long high of $4.40 and all-time high of over $80.

EnviroMission

ASX-listed EnviroMission has signed a development licensing agreement for solar tower development in Texas.

The MOU with an undisclosed party outlines developer rights to plan, develop and manage renewable energy power stations on the Texas electrical grid using EnviroMission’s ‘Solar Tower’ technology.

“This is the first licensing agreement EnviroMission has entered into in the United States that will provide EnviroMission with an initial fee for the assignment of the Solar Tower development rights in Texas as well as equity in the development enterprise and ongoing technology fees for each Solar Tower development,” EnviroMission’s Chief Executive, Roger Davey, said.

The company said its main focus in the US remained the La Paz Solar Tower in Arizona, a project that is certainly not lacking in ambition. If it does proceed it is slated to be the world’s second largest structure and generate 200MW.

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