Solar and wind energy shares have risen this week on the public markets as a result of the unfolding nuclear crisis in Japan and investor speculation.
First Solar (Nasdaq: FSLR), SolarWorld (SWV.DE), Trina Solar (NYSE: TSL), Vestas (VWS.CO), and Repower Systems (RPW.DE) are among those benefiting from uncertainty in the future of national energy policies.
"Shares in renewable energy industries yesterday rose while most other energy stocks fell," Clare Brook, fund manager of green investment group WHEB told The Guardian. "This tragedy comes on top of the oil price rise, the BP disaster in the Gulf of Mexico and unrest in the Middle East, all of which has made renewables more attractive. We would expect investment in renewables, especially solar, to increase. Nuclear has become politically unacceptable," she said.
However the solar sector could suffer from disruptions in Japan, according to Piper Jaffray analyst Ahmar Zaman, who notes that the nation accounts for 2 GW of capacity across the polysilicon, wafer, cell and module sectors.
"We believe lower demand in Japan will result in Japanese module suppliers looking to place more product in the rest of the world – that will pressure prices (ASPs) in 2011," Zaman wrote on Tuesday. But a drop-off in poly production in Japan would tighten global supply, which could counterbalance that.
The only sure thing is that the events in Japan are bad for the nuclear industry, as planned projects around the world are being put on hold.
Despite renewed interest in solar in the U.S. over the last year, the industry has been struggling to overcome increasing costs and a dwindling slice of the total generation pie.
The latest issue of the "Electric Power Monthly," with full-year data for 2010 US power generation, reveals that nuclear’s share of net electrical generation dropped from 20.22% in 2009 to 19.59% in 2010. Meanwhile, non-hydropower renewable energy sources (i.e., biomass, geothermal, solar, wind) increased by 16.5% over 2009 and provided 4.08% of net U.S. electrical generation.
Renewables, including hydropower, accounted for 10.32% of net electrical generation. During 2010, solar increased by 45.8%, wind grew by 28.1%, geothermal expanded by 4.4%, and biomass increased by 3.7%.
Among the non-hydro renewable sources, wind accounted for 56.3%, biomass for 33.6%, geothermal for 9.3%, and solar for 0.8%.
In addition, the US still does not have a long-term plan for dealing with growing stockpiles of nuclear waste. The US nuclear industry sued the Energy Department earlier this week in an effort to suspend the fees it pays to fund a waste storage program. (Reuters)
The fees amount to about $750 million a year, and the Nuclear Waste Fund stands at roughly $24 billion. Funds were to go to a national depository planned at Yucca Mountain in Nevada, but the Obama administration shelved its development.
In Related News…
Europe’s energy chief Tuesday raised the prospect of a nuclear-free future and said the 27-nation bloc is considering "stress testing" its nuclear power stations to check they can cope with crises.
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