Jeff Siegel - Angel Publishing

Whole Foods Stock

It's hard to believe that Whole Foods Market (NASDAQ:WFMI) was trading in the $50 range just one year ago. Today, the stock is struggling to stay above $10 a share. Of course these days, few stocks are immune from the global economic implosion we're dealing with now. But Whole Foods has become that one company that I can't help but to defend. You see, when Whole Foods first went public, it was a punching bag for every armchair analyst and media blowhard that took some kind of sick pleasure in the fact that in the first nine months of its IPO, the stock had dipped more than 30 percent. Of course, we cheered (and profited), after the stock enjoyed a meteoric rise in the years that followed. But now that the stock has been beaten back down again, the naysayers are back with a vengeance.

Now I won't dispute Whole Foods' less-than-stellar short-term outlook for investors. Though this has a lot more to do with overall market conditions than the company itself. But in an effort to rush to take a swing at the Whole Foods pinata, too many analysts are supporting questionable arguments against the organic retail giant.

A Revolutionary Tipping Point

A few months back I read an article in which a very well-known analyst stated that Whole Foods Market could suffer as companies like Wal-Mart and Costco expand into the organic food space. I believe this line of thinking is flawed and highlights the reason that those who analyze green markets from outside (as an observer, rather than an active participant), will always be confused.

As I just mentioned, when Whole Foods first went public, the stock was heavily bashed after it didn't soar in its debut. There were dozens of articles that were essentially the equivalent of a child screaming “I Told You So” over and over again. But what many of these analysts did not take into consideration was the overwhelming long-term potential of the organic food market – and its largest major retailer in the U.S.

This wasn't about an obscure supermarket catering to a few dozen hippie throwbacks from the 60s. The day Whole Foods went public was the day we witnessed the tipping point for a revolution that had been building momentum for more than 40 years – without any major retail presence. At that point, the retail food landscape was about to change for millions of organic food consumers, as well as for millions more who would soon transition their eating habits to include more organics.

Investors that took the time to see the big picture early on – instead of relying on little more than personal prejudices and an inability to even step foot in an organic food market – did quite well with the stock. But now that Whole Foods has been beaten down to levels few thought we'd ever see at this point, some are assuming that the company is losing market share to big box retailers. This is not a safe assumption to make.

Despite the appeal of discounted prices and bulk-order deals, you won't find a wealth of organic consumers roaming through warehouse retailers just to save a few bucks. And even with price premiums (which aren't nearly as overwhelming as some would suggest), most organic consumers want to shop at stores that cater to their healthy, responsible and sustainable lifestyles. This is something the big box retailers can't deliver. I took a trip over to Costco and found no fair trade coffee or non-toxic dishwashing detergent. I took a trip over to Wal-Mart and found few natural alternatives to common pharmaceuticals or biodegradable trash bags. Now understand, I'm not trying to bash these stores. I'm merely pointing out that they simply cannot provide me with what I want as an organic and responsible shopper. And I am one of millions.

My friends, although there's little data to back either side of this argument, I have seen no real evidence that organic consumers are flooding the aisles of Costco or Wal-Mart to get the best deals on free range chickens and organic produce.

Of course, I'm not saying Whole Foods is going to skate through one of the worst markets in recorded history because of customer loyalty. In fact, it was recently announced that Whole Foods had the biggest drop in spending per store visit (compared to other conventional food stores), from January to October. This is not surprising, and I suspect this won't look much better in the first half of 2009. However, tough economic times will not last nearly as long as the overwhelming and continued demand for healthy, organic food. And that's why we can't shrug off the potential of Whole Foods Market. Moreover, the $425 million infusion the company just got from Leonard Green & Partners should not be ignored either. We believe that this will help Whole Foods get through this global economic downturn, while allowing the company to continue its growth. As long as this recession doesn't linger around for more than a year or two, Whole Foods should come out of all of this a lot stronger, and a lot more attractive to investors.

To a new way of life, and a new generation of wealth...

Jeff

Organic Food Profit Trends

The farmers' market was absolutely packed this past Saturday.

Of course, it was my own fault for getting up so late...

If you're not there by 7:00 a.m., you have to maneuver through the flocks of chatty stay-at-home moms and hungover hipsters that always seem to congregate around the Thai food stand that displays deep-fried spring rolls like delicate glass ornaments.

But despite the larger crowds that morning, there was still plenty of food to go around at the stand where I pick up my weekly share of fruits and vegetables.

You see, I belong to a local CSA (Community Supported Agriculture). I pay a few hundred dollars at the beginning of the year, then throughout the summer and fall, I get a “share” of whatever my farmer grows.

This year, the Japanese eggplant, cantaloupe, and Thai basil have been exceptional.

I really couldn't be happier with our CSA. They're very reasonable; there's never a shortage of produce; and they're completely organic — something that's very important to me, and to a few million other U.S. consumers.

How You Could Make 508% Gains Off the End of Offshore Drilling

Deep-sea drilling is public enemy # 1 these days... President Obama is freezing any and all new projects from entering the water...

Is this the end of offshore drilling?

Three small American companies are taking advantage of the huge gamechange in the oil industry and drilling in the most oil-rich inland reserve in the country today.

Find out how you can get on board with the profits to be made in domestic drilling, and take huge advantage of this new ocean-less era.

Thriving sales in the Great Recession

While organic food and beverage sales only represented about 4 percent of all food and beverage sales in 2009, growth has been significant over the past two decades — moving from just $1 billion in 1990 to nearly $25 billion in 2009.

And globally, organic sales doubled from $25 billion in 2003 to almost $51 billion in 2008.

Even during recessionary times, organic food sales continue to grow... Perhaps not as much as pre-recession days, but according to market research firm Packaged Facts, the market for products marketed on the basis of ethical standards, including organic, is thriving despite the recession.

Here's what Don Montuori, publisher of Packaged Facts, had to say about the study:

Our survey indicates that more shoppers understand the environmental, social, and economic implications of their choices. The result is a sizable number of consumers who will purchase typically more expensive ethical products even in economically challenging times.

Certainly good news for organic food producers and retailers — and great news for Green Chip investors who have been playing a handful of organic food stocks this year!

Now while most of the stocks in the Green Chip Stocks portfolio are renewable energy plays, we also cover organic and natural food stocks. And if you take a look at three of the biggest organic and natural foods players out there, you'll see why.

Fat gains; healthy bodies

Every morning I start the day with a big bowl of organic steel cut oatmeal. I absolutely love the stuff... especially with a few dried cranberries and walnuts on top.

My favorite brand of steel cut oatmeal is Arrowhead Mills. Arrowhead Mills is a brand of Hain Celestial Group (NASDAQ: HAIN), a natural and organic food and personal care products company.

For Q4, Hain beat earnings by $0.02 and increased 2011 guidance. The stock got a ton of positive coverage following those results, including a near 10-minute spot on Cramer.

Today, Hain Celestial's getting a lot more love than it was getting just a year ago. But long term, we remain bullish. For the year, Green Chip Stocks members are up about 27% on HAIN.

Another organic and natural foods stock that's delivered for Green Chip Stocks members this year is SunOpta (NASDAQ: STKL).

SunOpta is a manufacturer and distributor of natural and organic food products. The company also operates a segment that provides pretreatment processes for the production of biofuels.

For Q2, 2010, SunOpta boasted revenues of $235.9 million compared to $216.1 million in 2009, and net income on a GAAP basis came in at $20.5 million compared to $1.8 million.

For the year, we're up 55% on SunOpta.

And of course, no coverage of the organic foods sector can be complete without discussing Whole Foods Markets (NASDAQ: WFMI).

Whole Foods is the king of the organic castle — boasting revenue of $8.03 billion for FY 2009, and $2.16 billion for Q3 2010.

Of course, same-store sales growth for the third quarter came in lower than the company had previously indicated, and that helped push the stock down last week. Today, WFMI is down about 12% since earnings; and certainly a broader market slide isn't helping matters.

That being said, Whole Foods is no slouch. And few stocks rebounded stronger than Whole Foods after the market tanked in 2008. After hitting a low of $7.04 in November 2008, the stock soared to a high of $43.18 just a few months ago.

That's a gain of more than 500% in less than two years!

And this was after an avalanche of negative press about the company's ability to survive during an economic downturn. Oh how easy it is to bash a company when the entire market is swan diving into the abyss!

As both an investor and customer of Whole Foods, I took offense to all the inane criticisms of Whole Foods, and responded with an article entitled, “Don't Underestimate Whole Foods.”

The stock is now up about 285% since I wrote that article.

Early stages of a food revolution

And although I have little doubt that today's economic nightmare is far from over — long-term, I still believe that Whole Foods is not a company that should be underestimated.

As well, I think we're still only seeing the earliest stages of a major food revolution that will cater to local organic food producers and retailers.

Recession or not, there continues to be a groundswell of support for local, organic, and fair trade products. And as a consumer of these types of products, I know I'm contributing to a healthier planet and supporting domestic job growth and security.

My garlic is not shipped from China; it's grown about 30 miles away at a beautiful organic farm that I can visit any time — no passport necessary!

Of course, I realize that not everyone gets as excited about locally grown organic food as I do...

But if you get excited about making money, don't sleep on this organic food movement.

Long-term, the potential here is solid.

And there's no doubt in my mind that this will prove to be one of the greatest investment opportunities of the next decade.

To a new way of life, and a new generation of wealth...

Jeff

Billionaires' Game-changing Fossil Fuel Gamble

Ladies and gentlemen, we're witnessing the end of an energy era.

George Soros and T. Boone Pickens know it -- which is why they're investing millions of dollars in the world's next biggest "future fuel."

Click here to find out how their gamble in this new energy giant could bring you upwards of 1,925% gains.

Alternative Energy Infrastructure

In the 1999 movie Office Space, there's a great bit of dialogue where three workers discuss the question What would you do if you had a million dollars?

I'll share the exchange with you here...

Peter: “Our high school guidance counselor used to ask us what you would do if you had a million dollars, and didn't have to work. And invariably, whatever we would say, that was supposed to be our careers. If you wanted to build cars, then you're supposed to be an auto mechanic.”

Samir: “So what did you say?”

Peter: “I never had an answer. I guess that's why I'm working at Initech.”

Michael: “No, you're working at Initech because that question is BS to begin with. If everyone listened to her, there would be no janitors, because no one would want to clean up sh** if they had a million dollars.”

Making Our Oil Addiction a Thing of the Past

BP's catastrophic spill proved once again that our addiction to oil is downright dangerous.

With our need for new fuels comes a new frontier for investors of these cheaper and more reliable future fuels...

Alternative energy expert Nick Hodge has come across a company that he expects can hand you over 1,925% gains with the transportation technology that will lead the pack in clean, efficient energy.

Find out more about this company now — before the news of this transportation technology makes headlines, sending its share price soaring.

I remember a similar scenario that my guidance counselor presented to me in high school... And had this scenario played out in real life, you wouldn't be reading this right now, and I'd be a professional skateboarder.

But I suppose most kids go through this, pondering what exactly it is that they want to do with their life.

My freshman year in college, I wanted to be a lawyer. I wanted to be the guy that took on the crooked politicians and spent countless hours volunteering for little old ladies getting booted out of their apartments by a heartless landlord who twirled the ends of his mustache like a Dastardly Whiplash.

Then my cousin — who is a lawyer — schooled me on the “non-glamorous” realities of that profession. It didn't take much more than a day to realize that the illusion I had in my head didn't even come close to matching the reality of his job.

His days were not spent peacocking around in front of juries, putting bad guys behind bars... His days were spent clearing paths through jungles of bureaucracy for his clients.

I have to be honest, I wouldn't last two days doing that kind of work. I just don't have the patience.

Thankfully, I have a friend who's a lawyer — and he is usually more than happy to decipher the power purchase agreements and regulatory filings that I use when analyzing market movements in the energy sector.

Now last week, he gave me a call and wanted to know if I had heard about the latest approval from the Midwest Independent Transmission System Operator (Midwest ISO) regarding a new transmission line project in Michigan.

Yes, he actually called to ask me this question. I'm telling you, this stuff is his life!

But in many ways, it's ours, too.

You see, electric infrastructure may not sound like the most exciting thing in the world... But when it comes to the development of alternative energy, infrastructure is crucial.

In fact I'm not even interested in covering a new solar or wind developer unless I know that there's either transmission already in place, or it's at least actively being built.

I don't care how exciting your technology is or how much funding you have lined up; when it comes to power — if you can't move it, you can't use it. It's that simple.

And this is why we spend so much time following the development of grid upgrades and expansions.

Well, that and the fact that some of these infrastructure projects can make us even more money than the solar, wind, and geothermal projects they're intended to support...

A pretty big deal

Last Thursday, ITC Holdings Corp. (NYSE: ITC) announced that it had received approval from the Midwest ISO for the company's Thumb Loop high-voltage electric transmission line project in Michigan.

This is actually a pretty big deal.

You see, this project is intended to serve as the backbone of a transmission system that will deliver wind power from Michigan's “Thumb” area (a subregion of the Flint/Tri-Cities region) to locations where it's needed.

And thanks to the Midwest ISO's approval, ITC can finally apply to the Michigan Public Service Commission for expedited siting approval of the project — which by statute is defined as a maximum of six months.

Of course, this project is also just one part of ITC's grand plan for integrating more domestic wind power.

You see, ITC has launched a project called the Green Power Express — a broad network of 765 kV transmission facilities designed to move up to 12,000 megawatts of renewable energy in wind-rich areas to major Midwest load centers.

Once built, the project will cross the Dakotas, Minnesota, Iowa, Wisconsin, Illinois, and Indiana, using about 3,000 miles of extra high-voltage transmission.

Take a look:

Of course, when it comes to infrastructure development, we're still moving at a snail's pace — thanks mostly to a shaky economy and continued complacency in Washington, where bureaucrats are more concerned with the next election than they are with strengthening our energy economy.

Nonetheless, we continue to focus a lot of time and attention on these transmission projects, because the reality is the U.S. will continue to increase power generation in order to meet future demand.

And in the process, new transmission projects will have to be built out and upgraded in order to facilitate this new power generation — most of which will be coming from alternative energy sources, like wind, solar and geothermal.

To a new way of life, and a new generation of wealth...

Jeff

"Home Repossessions Up 44% Over Last Year"

The dollar's plummeting... Unemployment remains at record levels... And the foreclosure crisis is just heating up...

But as bad as the numbers look — and as they get worse — one company's guaranteed to thrive from it all.

In fact as lenders work through their mountains of foreclosures, this outfit prepares to skyrocket — and could hand you an absolute fortune, month after month, through 2012.

Click here to find out how.

Gulf Clean Up

A couple of days ago, I saw some footage of a group of scientists releasing Kemp's Ridley sea turtles into the waters near Cedar Key, FL.

There were plenty of cheers to go around, and the often cynical news reporters, in full plastic perma-smiles, carried on about how things are finally getting back to normal.

I don't know who's orchestrating this illusion, but they're doing a bang-up job!

First we hear that all this oil magically disappeared thanks to a bunch of hungry microbes. Then we get some photo ops of the President taking a dip in the Gulf, followed up by happy scientists and happy turtles sharing a moment in the Florida Keys.

I'm just waiting for someone in Washington to order a few “Mission Accomplished” signs to display across a fleet of shrimp boats in Louisiana.

Sorry folks, you can smear as much Vaseline on that camera lens as you want. But there's a lot of stuff that still doesn't add up. Especially the claim by the National Oceanic and Atmospheric Administration (NOAA) that the “vast majority” of the oil spill is completely gone, and the remaining 25 percent consists of residual oil that's buried in sediments and sand.

I'm not buying it. And neither are a handful of scientists who have been on the front lines of this clean up effort.

No Big Surprises

A group of researchers at the University of George recently reported that about 75 percent of the oil from the blown-out Macondo well is still lurking below the surface. One of the lead researchers, Charles Hopkinson said. . .

“The idea that 75 percent of the oil is gone and is of no further concern to the environment is just absolutely incorrect.”

Another group of researchers from the University of South Florida has noted that their findings show that oil from the BP spill has settled on the sea floor further east than previously suspected, and at levels which are toxic to marine life.

And University of Georgia marine sciences professor Samantha Joye responded to the NOAA's report by saying that she has not seen any data that leads her to conclude that 50 percent of the oil is gone.

There's also an interesting article here where writer Kate Sheppard asks: Where's the Math on Government Oil Spill Report? Apparently there's a lack of actual calculations to back up the numbers the NOAA came up with.

Big surprise there!

And of course, there was the news yesterday that researchers have mapped a 22-mile long underwater plume of oil drifting through the Gulf at a depth of about 900 meters.

I suspect we'll continue to hear reports that challenge the NOAA's analysis for years to come.

In the meantime, here's what you can find today in Prince William Sound, where more than 20 years ago, 11 million gallons of oil (nowhere near the roughly 200 million gallons spilled into the Gulf) spilled out into the water:

Yeah, everything will be just fine. After all, 75% of all that oil in the Gulf is gone, right?

Right?!!

Jeff

Landing Energy Efficient Lighting Contracts

My grandfather served in the United States Navy.

Spending most of his career below the ocean's surface in some of the earliest nuclear submarines, he took part in some of the most dangerous naval missions in U.S. history.

I don't know all the specifics because most of that stuff was — and still is — top secret.

To this day, my grandfather is still tight-lipped. And if you ask him any specific questions, he just shrugs his shoulders and changes the subject.

So over the years, I've spent countless hours trying to learn what I can about his career and the submarines he served on. But to be honest, I've come up with very little.

I suppose it's probably better that way. After all, if this stuff truly is top secret, then a guy like me shouldn't be able to uncover sensitive military intelligence.

However, in my unsuccessful quest to uncover classified documents that would shed some light on my grandfather's military past, I did stumble upon something that I'm sure you'll be interested in...

Billionaires' Game-changing Fossil Fuel Gamble

It's a company that has a real shot at landing...

$416 million in potential Navy contracts

Here's the deal.

The largest consumer of energy in the entire world is the U.S. military — costing taxpayers more than $20 billion a year. And with every $10 increase in the price of oil, the Defense Department incurs more than $1.3 billion in additional energy costs.

So it's no surprise that with these energy costs only getting higher and higher, the Pentagon and the U.S. Defense Department are now forcing the military to drastically cut energy consumption.

In fact a recent Department of Defense Quadrennial Review report stated:

"The Department is increasing its use of renewable energy supplies and reducing energy demand to improve operational effectiveness and protect the Department from energy price fluctuations."

Now here's the profit angle...

It turns out that the U.S. Navy spends an absolute fortune in lighting costs. We're talking in excess of $1 billion a year.

But that's all going to change, thanks to a new program developed by the Defense Advanced Research Projects Agency (DARPA) — the same organization that gave us the Internet.

It's called the High Efficiency Distributed Lighting program (HEDLight), and its goal is to completely alter the design for lighting systems on U.S. military platforms so that they are stronger and more energy-efficient.

And we know of one company that's already in bed with DARPA on this project.

You can read our white paper on this company here.

HEDLight expects naval ships to save 87% of the electricity used on existing lighting systems.

Think about that for a second...

That means that for every $1 million the Navy was spending on lighting, they'll now only have to spend $130,000.

This is huge!

Imagine if a $25,000 car you wanted all of a sudden cost only $3,250. Or a $300,000 home you had been dreaming about buying now only cost you $39,000.

You'd jump on those savings in a heartbeat.

And that's exactly what the U.S. Navy's going to do with these lighting retrofits.

Now, we've done some quick calculations based on the Navy's entire fleet of battle force ships and the average potential cost of each lighting retrofit... My friend, we're looking at a potential value of $416.2 million.

And the company that's now working with DARPA on this project has. . .

Already retrofitted one Navy ship with new lighting systems
Landed another contract to retrofit a Virginia Class attack submarine
And just picked up another $2.8 million in lighting retrofit contracts for a handful of government buildings and industrial facilities.

Not bad for a tiny $2 microcap that hardly anyone's heard of.

You can see the details on some of those retrofit contracts here.

To a new way of life, and a new generation of wealth...

Jeff

P.S. This under-the-radar lighting retrofit stock has outperformed the Dow by 188% this year — and over the past three weeks, the stock has climbed almost 40%. Rest assured, it's not going to take much more than one more military retrofit deal to push this thing to $3.00... Read this report and get the information you need to invest early, before this ship literally sails.

Clean Energy Race

Will we ever get it?

That's the question I asked myself after reading a Reuters piece on Wednesday, which basically focused in on how pathetically backwards our thinking has become when it comes to clean energy.

It pains me to say it, but while the rest of the world moves forward on a new industrial revolution – we're playing partisan games in Washington, and essentially turning our backs on the greatest investment opportunity of the 21^st century.

How does that make you feel?

How does it make you feel to know that this country is being left in the dust – missing out on huge job creation opportunities and economic development – because our energy policy is being dictated by Big Oil and King Coal?

Hell, even Kevin Parker, the global head of Deutsche Bank's Asset Management Division, recently blasted the U.S. for “being asleep at the wheel.”

Parker said. . .

“Amid so much political uncertainty in the United States, Deutsche Bank will focus its 'green' investment dollars more and more on opportunities in China and Western Europe – where it sees governments providing a more positive environment.

They're [the United States] asleep at the wheel on climate change, asleep at the wheel on job growth, asleep at the wheel on this industrial revolution taking place in the energy industry.

The U.S. hasn't even entered the race yet for a clean energy economy.”

Of the $7 billion Deutsche Bank manages for green investments, about $45 million originated in the United States.

Given our superior solar, geothermal and wind resources, this is absolutely unacceptable!

And rest assured – the longer we keep acting like this transition is not an economic imperative – the quicker we'll become a second-rate nation.

It's real easy, folks. Either we get on board on now, or we all start learning Chinese.

It's our choice.

Jeff

Big Oil Money

It's no secret that coal and oil reign supreme – not because coal and oil are the best energy options, but because the coal and oil industries shell out the most cash for our elected officials.

If this wasn't the case, there would be no need for Big Oil and King Coal to pony up all those millions of dollars every year in campaign contributions. It's amazing at what a few bucks can do to keep all those fossil fuel subsidies flowing.

Of course, we're not the only ones screaming from the rooftops that something is terribly wrong here. In fact, there's a website called dirtyenergymoney.com, which tracks all that filthy lucre that moves from the conventional energy industry to Washington.

Here are few findings from the good folks at Dirty Energy Money, as reported by Steve Kretzmann at Oil Change International:

Overall, the coal industry has been friendlier to the Democrats than Republicans thus far in the 111th Congress, with over $3.7 million going to Democratic members of the House and Senate, compared with about $2.8 million to Republicans.
Republicans continue to take more oil and gas money, with the oil and gas industry contributing over $5.1 million to Republicans and $3.1 million to Democrats.
Senators voting in favor of a narrowly defeated June 10 resolution sponsored by Senator Murkowski that would have weakened the Clean Air Act and blocked new fuel economy standards, took on average two and a half times as much Dirty Energy Money as those who voted against it.
Senators who voted against a June 15 vote sponsored by Senator Sanders that would have eliminated big oil and gas company subsidies have taken more than 3 times more oil and gas money in this Congress than those who voted for the amendment.
House votes exhibit similar trends. Members who voted against the recently passed CLEAR Act (HR 3534), which removes the liability cap for oil spills and reforms oil and gas industry regulations, took nearly five times the amount of oil and gas money on average in the 111th than those voting for the Act.

To see how much dirty energy money your local politician has received, click here now.

Jeff

Electric Car Opportunities

In 2007, I wrote an article about incompetence in Washington, and Detroit's inability to deliver a truly fuel-efficient vehicle that could compete with the Toyota Prius.

Today, the incompetence in Washington hasn't changed at all. In fact, I would argue that it has gotten worse. But Detroit, on the other hand, has actually made some strides over the past few years.

In that 2007 article, I wrote. . .

I know it's not New Year's yet. But my wish for the New Year is that Detroit finally gets its act together and delivers a real fuel-efficient vehicle for us to drive.

As you know, the new Chevy Volt will soon be in showrooms. And I'm pretty excited to see how this one pans out.

Yes, the price tag is hefty – as are the price tags of all new technologies. You think that 91% of the U.S. population would be using cell phones today if they still cost what they did back in the 1980s?

Not a chance.

Over time, and as we start to see economies of scale kick in, the costs of electric and plug-in hybrid electric vehicles from GM - and every other major auto maker - will fall.

There's no doubt about that.

In fact, the entire electric vehicle industry has grown dramatically since we first started covering this market nearly a decade ago. And much of this can be attributed to some serious cost reductions in manufacturing.

Now the Chevy Volt is definitely getting the lion's share of publicity these days, but the entire industry is developing rapidly. And as investors, we need to stay on top of every new development – from new deals with major OEMs to electric car enthusiasts who continue to up the ante when it comes to pushing this technology forward.

Why Stalin's "lost oil" could bank you 180 times your money by this time next year

Joseph Stalin isn't widely known for the mistake he made nearly 70 years ago...

But he should be, because it stands to make a handful of savvy investors quite rich in the coming months.

In fact those who know what we've just uncovered could make as much as 180 times their money.

Read our latest report now before this story makes headline news.

Trucks, buses and drag-racing Datsuns. . .

Heavy truck manufacturer Navistar (NYSE: NAV), announced last week that it has seen an uptick in interest in its all-electric truck, the eStar. This is the truck that's now in FedEx (NYSE: FDX) and Pacific Gas & Electric (NYSE: PCG) fleets.

The vehicle is a Class 2c-3 truck boasting an all-electric range of 100 miles and the ability to carry payloads of up to 2 tons. Perfect for urban applications where many of these vehicles don't even get close to racking up 100 miles in a single day.

The vehicle also includes a quick-change battery that can be swapped out in 20 minutes.

Navistar plans to have a total of 400 built this year.

Ener1 (NASDAQ: HEV) also made news last week after the company announced it had landed a deal to provide its lithium-ion batteries to Hyundai Heavy Industries, which will be using the battery packs for electric buses.

Those buses are expected to be on the road this year.

Incidentally, while Ener1 isn't basking in the glory of profitability, it should be noted that the company's latest earnings show that sales surged 113% in the second quarter 2010 compared to the same quarter a year ago.

And finally, for those who question the ability of an electric car to “keep up” with conventional internal combustion vehicles on the nation's highways, take a look at this video of a converted 1972 Datsun.

Equipped with a set of lithium polymer batteries, this little white Datsun ran a ¼ mile drag race in 10.4 seconds at a top speed of 117.21 mph.

Don't expect the new Chevy Volt to do that.

But do expect it to be a major game-changer that's sure to help usher in a new chapter in personal transportation.

For a list of the new electric vehicles coming down the pike over the next few years, check out our free report, The Electric Car Revolution Starts Now!

To a new way of life, and a new generation of wealth . . .

Jeff

Global Warming Predictions

Here's a new spin on the climate change debate for ya...

Tad Patzek, chair of the Petroleum and Geosystems Engineering Department at the University of Texas and well-known energy expert, has recently come out and said that climate change predictions should be revised.

Is it because he uncovered the great liberal conspiracy of global warming?

Is it because a new report funded by Exxon proves that climate change isn't real?

Is it because a hacked e-mail from an IPCC researcher just brought to light proves that in 1983, Al Gore snuck into NORAD with Matthew Broderick and Ally Sheedy, and manipulated climate data in the military supercomputer known as WOPR, using a backdoor password to Falken's Maze?

Actually, none of those reasons made the cut.

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The details are too numerous to list right here, but this report — dubbed a best seller by The New York Times — helped uncover an incredible source of oil no one had considered for years.

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You see, Patzek is warning that climate change predictions need to be revised because most of today's predictions are not accounting for the peak and decline of coal production after 2011.

Now bear with me, because this is pretty good stuff...

The IPCC has 40 different climate change scenarios. But Patzek has indicated that 36 of those scenarios predict future carbon production and emissions using current rates of coal production.

Clearly, an integral piece of climate change data is not being accounted for.

Coal, coal everywhere... but not really

In the past, the United States has been called the Saudi Arabia of coal, boasting a 250-year supply.

This 250-year estimate was in fact accurate — about 30 years ago, when it was based on USGS data from the 1970s.

However, in 2007, the National Academy of Sciences studied updated USGS surveys and found that at current rates of consumption, there's probably only enough coal to meet our needs for about 100 years.

Think about that for a second.

That's a pretty big discrepancy, considering you're talking about a resource that we rely on for roughly half of the country's power generation.

And for an even more sobering look at domestic coal supply shortfalls, consider the Energy Watch Group's (EWG) study that examined the energy content of our coal supplies.

We actually referenced this study in our book, Investing in Renewable Energy:

For comparison purposes, EWG translated the energy content of the coal into tons of oil equivalent. In terms of volumes of stuff mined, they found that U.S. coal production can continue to grow for about another 10 to 15 years. But in terms of energy, which is the only metric that really matters, U.S. coal production peaked in 1998 at 598 million tons of oil equivalent, and had fallen to 576 million by 2005.

Now if the National Academy of Sciences and the Energy Watch Group are correct, then this puts a whole new spin on the value of some so-called “clean” energy technologies that the government and special interests are trying to push.

Another round of poor government policies

If you're a frequent reader of these pages, you know we don't buy the clean coal myth for a second.

No matter how you slice it, coal ain't clean. And the promise of carbon sequestration does not change that.

Also consider that carbon sequestration actually decreases the efficiency of a power plant.

Knowing that we only have a finite supply of coal, does it really make sense to expedite the depletion of this supply with carbon capture and sequestration?

As Patzek points out:

The current global hysteria around carbon capture and sequestration is leading to desperately poor government policies. For instance, large-scale subsurface sequestration of CO2 will decrease power plant efficiency by up to 50 percent.

After the November elections, both Democrats and Republicans will be gearing up to push their own energy agendas. I suspect both sides will champion carbon sequestration as a clean energy option.

After all, King Coal's access to Washington is V.I.P. — while yours is "by appointment only," if you're lucky enough to get that far.

But at the end of the day, the basic fundamentals of supply and demand will show that carbon sequestration is probably not the most economically sustainable way to transition to a cleaner energy economy.

That doesn't mean it won't happen.

Rest assured, there are a lot of fat cats in Washington more than willing to trade your tax dollars for campaign contributions, just to continue the “clean coal” lie.

Here's a list of the top 20 recipients of coal mining lucre for 2010:

Rob Portman (R-OH) - $69,275
Daniel Mongiardo (D-KY) - $64,599
Roy Blut (R-MO) - $48,200
John Hoeven (R-ND) - $44,609
Nick Rahall (D-WV) - $44,000
Richard C. Shelby (R-AL) - $36,300
Evan Bayh (D-IN) - $30,750
James W DeMint (R-SC) – $26,823
Joe Barton (R-TX) - $26,290
John M Shimkus (R-IL) - $25,500
Ben Quayle (R-AZ) - $24,000
Carly Fiorina (R-CA) - $23,399
Pat Toomey (R-PA) - $22,945
Lisa Murkowski (R-AK) - $22,100
John Thune (R-SD) - $21,084
Robert R Simmons (R-CT) - $20,410
David Vitter (R-LA) - $19,678
Trey Grayson (R-KY) - $19,100
Rick Boucher (D-VA) - $18,900
Geoff Davis (R-KY) - $18,600

And who says both parties can't come together on important issues?!

You can see the original list of recipients at opensecrets.org.

To a new way of life, and a new generation of wealth...

Jeff

Natural Gas Development

A couple of days ago, the New York State Senate approved a bill that would temporarily place a moratorium on natural gas exploration (using hydraulic fracturing with horizontal drilling) until a safety and environmental review is completed, and new guidelines for drilling permits are issued.

Critics of hydraulic fracturing in the region claim the “fracking” process poses threats to critical water supplies that provide drinking water for millions of New York residents.

(You can see some pretty powerful video footage of the potential damage here.)

However, the Independent Oil and Gas Association of New York has stated that the moratorium will delay jobs and tax revenue the state would attract with more drilling.

The association's executive director, Brad Gill said, “We have companies that want to come to New York, but in this regulatory and legislative climate and instability they’re going to Pennsylvania. We’re just losing out on this economic opportunity.”

It'll be interesting to see how this one plays out. The concerns of local citizens over the safety of their drinking water are up against the loss of jobs and tax revenue that these hydraulic fracturing operations can supply.

What are your thoughts?

Do you think the New York State Senate's moratorium could effectively kill off much-needed jobs in the region?

Or do you think the Senate is right in siding with residents who want the drilling stopped in an effort to protect their water supplies?

Jeff

Molycorp, Inc. Rare Earth IPO

Molycorp, Inc. (NYSE: MCP) — the much anticipated rare earth IPO — debuted last week to a chorus of crickets.

Priced below its planned offering on its first day, the stock sputtered at the starting gate. And of course, it didn't take long for the sharks to circle.

So what happened?

It's like getting a piece of the automobile market back in 1908.

And not just Ford either. We're talking about the market as a whole. Oil, rubber tires, road construction... the whole nine yards!

Click here to learn more.

After all, given the fact that China controls nearly all of the world's production of rare earth minerals, certainly a rare earth play operating outside of China would garner a lot of positive attention.

I found last year, while attending a modern minerals conference in Toronto, most of the presenting companies were quick to boast that they were not operating in China.

And with rare earths absolutely crucial to the development of our clean energy economy — especially for electric vehicles — the potential of a domestic rare earth operation alone would seem quite promising.

But here's the problem...

Molycorp's been losing a lot of money.

And in this market, you better at least have something to parade around if you're not profitable.

Tesla (NASDAQ: TSLA) is the perfect example.

I love the company, and I wish nothing but success for this group of Silicon Valley entrepreneurs who had the audacity to show the world that a tiny tech company could build and sell something the major automakers wouldn't.

But despite my love for Tesla, it still went public while losing money.

Of course, showing off those electric wheels to a ravenous media definitely helped the stock shoot north when it went public.

It sure as hell wasn't the numbers!

But Molycorp doesn't have a superstar electric car to flaunt all over the media. It does have a pile of losses that no one — especially in this market — is going to ignore. And from what I've been told, the soonest anyone can expect profits will be in 2013.

Of course, this is a mining project, so no one should really be expecting any kind of instant gratification here.

But I don't know a single person who was willing to go into this company for $14 a share.

Not in this market, and not with a mining project.

Of course, it's not all doom and gloom here, either...

A different kettle of fish

While rare earths are used in things like electric cars and wind turbines, they're also used for military applications, like tank navigation systems, radar, and missiles.

And although some in Washington can't see the urgency of our clean energy transition (it's hard to see over those huge piles of campaign contributions from the oil and coal industries), when it comes to the military... well, that's a whole different kettle of fish.

Earlier this year, Republican Mike Coffman called for the creation of a national security stockpile and for government loan guarantees for companies that want to mine and process rare earth elements in the United States.

And the Congressional Accountability Office released a report in April that took a look at the national security risks associated with our dependence on rare earth materials.

Here are a few key points from that report:

While rare earth ore deposits are geographically diverse, current capabilities to process rare earth metals into finished materials are limited mostly to Chinese sources.
The United States previously performed all stages of the rare earth material supply chain, but now most rare earth materials processing is performed in China, giving it a dominant position that could affect worldwide supply and prices.
Based on industry estimates, rebuilding a U.S. rare earth supply chain may take up to 15 years and is dependent on several factors, including securing capital investments in processing infrastructure, developing new technologies, and acquiring patents, which are currently held by international companies.
Government and industry officials have identified a wide variety of defense systems and components that are dependent on rare earth materials for functionality and are provided by lower-tier subcontractors in the supply chain.
Defense systems will likely continue to depend on rare earth materials, based on their life cycles and lack of effective substitutes.
Some DOD components, other federal agencies and companies are taking initial steps to limit their reliance on rare earth materials or expand the existing supplier base.

Whether it's “green” energy applications or military applications, there's no doubt in my mind that domestic rare earth operations have a real shot going forward.

But Molycorp definitely has a ton of work to do if it wants a piece of this action.

The ball is in their court, and I think it would be naïve to suggest that they can't pull it off.

Certainly we'll continue to monitor the company's progress.

But for the time being, I'm not convinced the company will have much luck convincing investors that the stock is worth buying at these levels.

To a new way of life, and a new generation of wealth...

Jeff

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Energy Bill Opportunities

Well, once again, politics have trumped progress.

With politicians unwilling to take a meaningful stand on energy legislation so close to an election, the United States now risks falling further behind the rest of the world in the energy game.

I won't even get into the nuts and bolts of this pathetic attempt at an energy bill. It's just not worth it.

But the bottom line is that our nation is run by cowards and thieves.

I don't care which side of the aisle — at the end of the day, it's all about making sure those campaign coffers are filled.

For the hardworking folks in this country who want to embrace a safer, cleaner, and more economically sustainable energy economy for future generations — this is unfortunate.

But for investors, there's actually still a number of opportunities that will stem from this latest energy bill.

And we're not going to ignore them.

So, so efficient

Not surprisingly, this new “energy bill” latched on to the easiest and least-controversial measure: energy efficiency.

And please don't mistake my tone for disappointment.

As we've been saying for years, energy efficiency is the easiest way to embrace a new energy economy.

You can generate all the solar and wind power you want; but if you continue to waste it, how much progress are you really making?

So yes, we are certainly pleased that energy efficiency is still a priority in Washington — despite the motivation of our elected officials.

In the bill, a $5 billion home efficiency incentives package is expected.

Called the Home Star program, supporters claim that it will result in the creation of tens of thousands of jobs while significantly reducing energy consumption. Some have also suggested that the reduction in power consumption will be the equivalent of the output of three coal-fired power plants every year.

And consumers who participate in the program could save anywhere from $200 to $500 a year in energy costs.

Big Box players that provide weatherization materials and energy efficient appliances — like Home Depot (NYSE: HD), Lowes (NYSE: LOW), and Best Buy (NYSE: BBY) — will probably benefit in the short term. And since GE (NYSE: GE) has its hand in nearly every new energy efficiency gadget and tool, it will also likely benefit.

Why You Should Listen to Walmart

Whatever you think of their politics, you can't argue that Walmart makes money.

So when they make a business decision, 9 times out of 10 it's wise to listen...

In fact, we've been following one energy investment of theirs that could end up handing you over 19 times your money.

Click here to find out more.

Got gas?

With about $4 billion worth of incentives to convert trucks to run on natural gas, there are definitely some opportunities here.

One is Clean Energy Fuels (NASDAQ: CLNE), which builds and operates advanced natural gas fueling stations across the country. Any further support for converting trucks to run on natural gas will certainly bolster this stock.

My colleague Nick Hodge also has a very profitable play in this area. It's a company that makes state-of-the-art engines that run on natural gas. They've got major deals with Peterbilt and Volvo, and guys like George Soros and T. Boone Pickens already own 7 million shares combined.

You can read more about this one as a member of Nick's Alternative Energy Speculator.

Trickle-down progress

Not interested in natural gas?

Well, word on the Hill is that the Oil Spill Liability Trust Fund tax may be raised from 8 cents a barrel to 49 cents per barrel. If that were to happen, the cost would certainly trickle down to the consumer.

Throw that on top of the effects of peak oil or any major or minor disruption along the way, and you've got the recipe for a market ready to embrace conventional hybrids and those new electric vehicles that are coming in 2011.

And if you're unsure of this, consider that when gas hit $4.00 a gallon, there was a rush on Toyota Priuses. Dealers couldn't keep them in stock, and consumers were paying above sticker price to get them.

Toyota was clearly rewarded for their forward thinking, while thousands of gas guzzlers collected dust and bright neon signs offering massive “inventory reduction” discounts.

And keep in mind, when Toyota first started peddling Priuses, there was no meaningful energy legislation in Washington...

So even though we're about to see a half-assed energy bill (as Senator Lindsey Graham recently called it), to assume that alternative energy opportunities are going to disappear is not a safe assumption to make.

Rest assured — there's still a ton of money to be made in alternative energy.

And we're going to continue to make it.

To a new way of life, and a new generation of wealth...

Jeff

Electric Vehicle Investing Opportunities

Bipartisan support.

It's the elusive beast that's seen about as often as the chupacabra.

And when it does make an appearance, it's usually in regards to congressional pay raises or to maintain a system where special interests sit at the VIP table while hard-working Americans get stuck with the bill.

But yesterday, we did see some broad bipartisan support on something that I didn't really expect at all...

The Promoting Electric Vehicles Act (PEVA)

Intended to pony up about $3.9 billion over 10 years to build electric car charging infrastructure, conduct research, and provide incentives, PEVA was voted out of committee and will now be scheduled for a vote in the Senate.

Of course, as with anything in Washington, there's good news and bad news.

The good news

It's pretty simple...

Anything that enables us to decrease our oil consumption is a good thing — for the economy, for the environment, and for the sake of national security.

I don't think you'll get many arguments on that.

And of course, any support on the Hill for electric vehicle integration is good for all those electric car and high-performance battery stocks, like Tesla Motors (NASDAQ: TSLA), A123 Systems (NASDAQ: AONE), and Ener1 (NASDAQ: HEV).

Whether or not you're an investor, more electric vehicles on the road equates to a stronger, cleaner energy economy.

And that benefits everyone.

The bad news

First of all, there seem to be quite a few overzealous policy makers in Washington who are being unrealistic in regards to how many electric cars we can get on the road within the next 20 years.

The goal, as I understand it, is to electrify half the country's cars and trucks by 2030.

I'm about as optimistic as they come when discussing the potential of electric vehicles. And I'm not saying that such a goal is impossible to reach...

But $4 billion for this program, no price on carbon, and exceptionally low gasoline prices — thanks to continued oil subsidies and a complete disregard for the liquidation of natural capital — will make this goal very difficult to reach.

I've had the opportunity to talk to a lot of experts in this field. And I've yet to meet one who believes we can electrify half of the country's cars and trucks by 2030 if gasoline prices continue to stay so artificially low.

Of course, that being said, the reality of peak oil and its effect on gasoline prices could force me to eat a huge plate of crow. And I'll be happy to dig into that!

Another issue that can't be disregarded is the simple fact that there will be opposition to this bill.

There will be the obligatory “this is just more spending of tax payer dollars” argument. (Although $4 billion over ten years is peanuts compared to the $44 billion we spent to protect the oil supplies of the Persian Gulf in 2007 alone.)

I guess when talking about tax dollars, it really all boils down to priorities.

Another argument is that the bill only targets a small group of communities and would not be deployed nationwide.

Why should federal dollars only be targeted in certain regions, but not in others?

In theory, I actually understand this argument; but in practice, I don't know if it's valid.

Aside from South Dakota and Alaska, I've had the great privilege of visiting every state in the nation...

And I can tell you that you're going to have a lot more luck with the large-scale integration of electric vehicles in places like Los Angeles and Washington D.C. than you will in Biloxi or Casper, Wyoming — a place where limited-range electric vehicles wouldn't even make much sense.

Of course, there are plenty of folks in these regions who do own conventional hybrids. And I think that in our race to electrify our vehicles, we shouldn't completely disregard the impact that conventional hybrids can have on our oil consumption.

While you may not see a lot of Nissan LEAFs next year on Highway 10, Toyota (NYSE:TM) Priuses are already quite common in the Equality State.

And as conventional hybrid prices continue to fall, we'll likely see even more hybrids on the roads going forward.

Heck, Ford actually just came out today with an announcement that it will now sell its hybrid version of the 2011 Lincoln MKZ sedan for the same price as the gas-powered version!

Granted, it's still a pricey vehicle, coming in at around $35,000... But if you're going to pay that much for the car, wouldn't you rather have the model that gets better mileage?

While the gas-powered version of the MKZ gets 18 mpg/city and 27 mpg/highway, the hybrid version delivers 41 mpg/city and 36/highway.

Not bad.

Overall, it's refreshing to see some bipartisan support on this electric vehicle bill. But the need to curb our insatiable thirst for oil is an urgent one.

And this bill must be just one of the many efforts we take as a nation to transition our energy economy.

To a new way of life, and a new generation of wealth...

Jeff

Military's Latest Energy Report Will Give You the Willies

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Ecosystem Investing

Over the weekend, I did an interview on a radio talk show.

Unfortunately, you'll never hear it.

It's my own fault though. I dropped the "f bomb" a few too many times.

That's right — and I have no plans to stop using it, either...

Free Market!

I bet you thought I was going to say something else, didn't you?

Either way, "free market" must have been just as offensive as the other "f" word, because every time I started talking about how a real free market would validate the economic advantages of many energy alternatives, I was cut off.

You see, the guy who was interviewing me essentially just wanted to debate. And I was fine with that.

Happy to do it, actually...

The only problem is that he (and so many like him) don't really want to hear the truth about energy.

They're completely satisfied buying into the cheap energy illusion — feeding into the hype that alternatives can only survive with government support, never once acknowledging the massive subsidies that oil and coal receive every single year.

Truth be told, I'd be happy to do away with subsidies altogether. That means both alternatives and fossil fuels never see a single taxpayer dime ever again.

If you truly value a free market, then certainly such a suggestion shouldn't be a problem.

Now we've discussed the subsidy issue in these pages before, so I won't rehash it here.

(Though if you'd like to see how fossil fuels landed $72 billion in subsidies during the same time renewables received $29 billion between 2002 and 2008, you can see the analysis here.)

Of course, $72 billion is nothing compared to an additional...

$2 Trillion unaccounted for — every single year!

I've been in the investment publishing game for 16 years now.

In that time, I've made a lot of friends (investors who made a ton of dough in alternative energy), and I've pissed off a lot people (folks who use my analysis of alternative energy as an excuse to spout off about liberals, socialism, and those pesky treehuggers).

If you're the latter, you may want to stop reading now.

Last week, U.N. States proposed the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES), a new body that seeks to advise on valuing nature and conservation targets.

Now before you roll your eyes and write this off as some environmental rant, consider that the biodiversity and ecosystem services (what we define as natural capital) that are being discussed have more than just an aesthetic value.

This stuff has real economic value. According to U.N. reports, the world's natural capital is valued at $2 trillion-$4.5 trillion a year. And yet these are figures that are not being included in economic measurements or GDP.

If the liquidation of natural capital was figured into the equation when measuring performance (as it should be), how cheap would oil and coal really be?

The European Commission issued its Economics of Ecosystems and Biodiversity report (TEEB) last week in an effort to find a way to properly measure the value of natural capital.

Here's what Angela Cropper, Deputy Executive Director of the U.N. Environment Programme had to say at press conference for the launch of the TEEB:

Biodiversity is disappearing at up to 1,000 times the natural rate, and ecosystems are functioning less and less effectively.

About 60 per cent of ecosystems have been degraded or used unsustainably, including provisioning (food and fibre) and regulating services (climate, flood, water purification).

Around 50 countries face moderate or severe water stress.

By 2030, it is thought that water scarcity could cut agricultural harvests by 30 per cent.

If numbers or statistics we've heard today, either about biodiversity loss or the value of ecosystems seem at first too abstract or too distant, there can be no denying that we are already feeling the effects of biodiversity loss: rising food prices, a lack of once commonly available fish, some of the worst droughts in a decade affecting exports basic foods and in the worst cases, causing severe food shortages and widespread hunger.

Of course, we don't need a press release to tell us something that we're seeing in our own backyard right now...

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Thanks for the case study, BP!

According to economist Pavan Sukhdev, the BP debacle underscores the need for a change in how natural capital is measured and valued. He argues that had a holistic economic assessment been required before drilling was allowed, the potential liability might have motivated BP to take more stringent safety measures.

Sukhdev also notes the $20 billion ponied up by BP for compensation and cleanup, but asks the question, "... what about the cost to the economy of lost utility — eco-tourism loss, fisheries stocks that represent future losses to industry, the inability to fish in the area?"

The economic loss caused from this single disaster will dwarf $20 billion.

From the death of mangroves which serve as nurseries for commercial marine species and protect against hurricane damage... To the health effects that will come to fruition as we are forced to remember that it's a long and nasty fall when you're at the top of the food chain... The grand total from this disaster will not be a small one.

Of course, it'll take decades before we'll really be able to get an honest assessment. So I can't even imagine how one could put a valid price tag on it now.

Hell, we still don't even know how this whole thing's going to play out. That whole area out there in the Gulf seems like a ticking time bomb.

We got confirmation this morning that a seep has been found near the well, and anomalies have been noticed at the well-head. Scientists also remained concerned about large amounts of methane escaping through cracks in the sea floor.

This is far from over, my friends.

So lets drop the partisan rhetoric, and consider, honestly... Is there an economic advantage to using alternatives to oil?

You better "f-ing" believe it!

To a new way of life, and a new generation of wealth...

Jeff

Clean Energy Investing

The Sustainable Energy Finance Initiative published the Global Trends in Sustainable Energy Investment 2010 report last week.

Here are some of the key findings. . .

New investment in sustainable energy in 2009 was $162 billion, down from $173 billion in 2008. The 7 percent decline reflected the impact of the recession on investment in Europe and North America in particular, with renewable energy projects and companies finding it harder to access finance.
China saw a surge in investment. Out of $119 billion invested worldwide by the financial sector in clean energy companies and utility-scale projects, $33.7 billion took place in China, up 53 percent on 2008. Financial investment in Europe was down 10 percent at $43.7 billion, while that in Asia and Oceania, at $40.8 billion, exceeded that in the Americas, at $32.4 billion, for the first time.
Research, development and deployment spending by governments and corporation totaled $24.6 billion in 2009, with government R&D up 49 percent at $9.7 billion and corporate RD&D down 16 percent at $14.9 billion. The shifts reflected greater willingness by governments to invest in research on sustainable energy technologies – to help generate economic activity – and also caution on the part of some big corporate players at a time when their profits were under pressure.
Clean energy share prices rose almost 40 percent in 2009, reversing around a third of the losses they experienced in 2008.

You can read the full report here.

Jeff

Fannie Freddie and Pace

A couple of months ago, I told you about the PACE program (Property Assessed Clean Energy).

This is the program that allows you to finance your solar system (or energy efficiency upgrades) through a municipal loan that's paid back through your property tax bills.

Well last week, the Federal Housing Finance Agency (FHFA) announced that PACE programs “present significant safety and soundness concerns that must be addressed by Fannie Mae and Freddie Mac, and the Federal Home Loan Banks.”

What the hell does Fannie and Freddie know about safety and soundness?

These guys are sitting on unlimited credit lines from the U.S. Treasury, and are now expected to cost taxpayers anywhere from $160 billion to $1 trillion. Yeah, that sounds real safe and sound...

The FHFA also went on to say:

First liens established by PACE loans are unlike routine tax assessments and pose unusual and difficult risk management challenges for lenders, servicers and mortgage securities investors. The size and duration of PACE loans exceed typical local tax programs and do not have the traditional community benefits associated with taxing initiatives.

Jonathan Hiskes from Grist.org put it best when he responded:

The agency is arguing that reducing greenhouse-gas emissions, saving homeowners money on utility bills, and creating local jobs working on homes are not "traditional community benefits." It's making another argument too: That it should get to decide what projects have local-community benefits.

Also worth noting is the recent Pike Research study, “The U.S. Energy Service Company Market,” which indicated that in a scenario in which more PACE financing becomes available, the market could soar to $37.6 billion by 2020.

That may not seem like a lot to Fannie and Freddie — which have already drawn $145 billion from that unlimited credit line — but to fiscally responsible Americans, this is a big deal.

Don't lend to deadbeats

Admittedly, there are always legitimate concerns when talking about a situation where borrowers could potentially default. Especially these days. But there's a real simple solution to this: Don't lend to people who you know are a risk!

It's not rocket science.

Dishonest and irresponsible lenders, borrowers, and policy makers enabled an unsustainable housing market by ignoring the threat of making bad loans.

Just pass 'em on to the next guy, right?

But who got screwed in the end? Fiscally responsible taxpayers.

Today, we have an opportunity to allow responsible homeowners to pay for the cost of energy improvements through an additional charge on their property tax.

But a bunch of bureaucrats have decided that this isn't a good idea. The same bureaucrats that took part in the worst housing disaster in U.S. history.

And once again, it's the fiscally responsible taxpayer — the guy who just wants to put some solar up on his roof, and pay for it through this unique program — that gets screwed.

Brilliant!

Jeff

Green Parking Lots

"It's like ice skating on the parched tongue of a West Baltimore hooker!"

That's how a dear friend of mine once described summertime in Baltimore.

I know, it's a bit over-the-top... And I'm not even sure how one comes up with such a bizarre analogy.

But make no mistake about it — those hot, muggy days that plague Charm City from June through August are brutal.

And last week, we got a dose of some serious heat oppression.

Folks walking from the bus were breaking a sweat before the bus even drove off.

Bike messengers were moving a lot slower; parking attendants were locked inside their air-conditioned booths, and hundreds of cars parked in the lot outside of our office were baking in the sun.

You could see the heat haze swirling around the rows and rows of sedans, SUVs, hybrids, and convertibles. It looked like high-end special effects from a James Cameron film. And I definitely felt for all the poor souls who had to climb into those mobile solar ovens at quitting time.

But it also got me thinking about a solar-powered parking structure I saw in California a couple of years ago.

Built by a company called Envision Solar (OTCBB: EVSI), the structure provided shade for parked vehicles and turned parking lots into solar electric generating systems.

Take a look...

What a fantastic use of space — especially as we prepare to integrate electric vehicle charging stations into our parking lots and garages.

You know, often we think of parking lots of having no real value beyond providing a place to park our cars. It's almost as if building design ends at the curb, and the parking lot is a necessary afterthought.

But that's a lot of empty space that could be multi-functioning.

Envision has actually demonstrated this with 16 installed projects in the United States, most of which are in California. The company also has about 70 megawatts of projects in its pipeline right now.

Envision Solar has even developed a new solar tracking technology that can increase the output of these systems by 20% and reduce cost per watt by 15%.

The first prototype — which was funded by the state of Pennsylvania — will be completed this year.

Parking lots go green

There's also an interesting company called Greenscape Capital Group (TSX-V: GRN) which is currently building a 4,200-stall parking facility in Denver.

The company claims it will be the world's greenest parking facility — utilizing solar and wind power, natural landscaping, and alternatively-fueled shuttle vans. The facility even boasts building specifications based on the U.S. Green Building Council's LEED Gold rating.

The appraised value upon completion of the project is about $31.7 million with projected net operating income of $5.1 million per year in years 2-10. The project has a 25-year life with the option to extend to 45 years.

Greening up parking lots and parking garages may not sound like the most exciting thing in the world — but there's some serious profit potential here.

So certainly we will continue to cover these developments going forward.

To a new way of life, and a new generation of wealth...

Jeff

Investing in Green Stocks

I was fortunate that one of my earliest investments was a bust.

I'm serious.

It was 1993, and I didn't have a lot of money.

I was working a night shift at a credit reporting facility in Atlanta, running around a tape library for 12 hours a night, fetching and monitoring credit reports.

It was insanely boring, but the night shift paid more — allowing me to have just a few extra dollars to invest every month.

Admittedly, it was an exciting time. The promise of doubling and tripling my money got my juices flowing.

But my inexperience and unrestrained enthusiasm also led to some bad investment decisions.

What the coal industry doesn't want you to know can

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Like many young investors, I got emotional. I wanted to invest in companies that I believed in. Companies that were doing things that I understood and could support.

I was so religious about it that I allowed my emotional connection with these companies to trump basic logic.

The result was an investment that nearly wiped out my small but growing portfolio.

It was an environmental remediation company that I bought on a dip. And in all fairness, management had some serious green credibility. But the stock was a dog.

I won't get into the dozen or so reasons this stock never had a chance... But I will tell you that this company simply had a business that could not possibly succeed — no matter how exciting its technology was.

After about a year or so, I sold it for an 87% loss.

Brutal!

But a very valuable lesson was learned. And it's one that I have never repeated.

Admittedly, I still only invest in companies I understand and support. But coupled with aggressive due diligence, this has allowed me to make a lot of money — and help thousands of others make a lot of money — in alternative energy and organic and natural food stocks.

And that's why I'm writing this article today.

Given the continued uncertainty of the broader market, I know a lot of folks are either losing money, or they're simply too shell shocked to jump back in.

The latter decision is not something I can completely disagree with, either.

That being said, there are still opportunities out there for Green Chip investors. And if you're willing to get a little more aggressive during these tough times, you can actually come out of this continued economic downturn with a few bucks in your pocket.

"If a business does well, the stock eventually follows... "

While we remain bullish on the long-term potential of alternative energy (if you need a reason, look no further than this), there is no doubt that the remainder of 2010 will be a tough one.

And the bottom line is that the most money being made right now in alternative energy is being made by those who are loading up after those big dips, and cashing out when they spike.

The question is, How do you know which of these alternative energy stocks to play this way?

After all, not all of these dips are followed up by quick pops..

As Warren Buffett once said: “If a business does well, the stock eventually follows.”

It seems like every few weeks now, we have another opportunity to scoop up cheap shares of any number of green chip stocks. Solar, wind, geothermal — you name it.

But only those companies that are doing well — or that are on the verge of doing well, and have the data to back up that claim — are the ones that always come through for us.

So here's a list of our top seven green stocks to pick up the next time they slide with the rest of the broader market...

Trina Solar (NYSE:TSL)
JA Solar (NASDAQ: JASO)
First Solar (NASDAQ: FSLR)
Ormat Technologies (NYSE: ORA)
EnerNOC (NASDAQ: ENOC)
Itron (NASDAQ: ITRI)
Hain Celestial (NASDAQ: HAIN)

These are all pretty solid plays that don't typically have a problem bouncing back after major market slides.

In other words, these are the business that are doing well.

As an added bonus (if this is important to you), all of these companies are helping to enable a cleaner and more sustainable energy economy.

Not a bad deal.

To a new way of life, and a new generation of wealth...

Jeff

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Electric Vehicle Investing

It's no secret that we're huge advocates of electric and plug-in hybrid electric vehicles.

I've personally been writing about this stuff for nearly a decade now, providing coverage on electric vehicle-related companies like:

Ener1 (NASDAQ: HEV)
Maxwell Technologies (NASDAQ: MXWL)
UQM Technologies (AMEX: UQM)
Enova Systems (AMEX: ENA)
Electrovaya (TSX: EFL)
Johnson Controls (NYSE: JCI)
and A123 Systems (NASDAQ: AONE)

And I maintain that electric vehicles (EVs) can help us significantly reduce our oil consumption, and if done right, provide millions of jobs for hard-working Americans.

However, despite the EV enthusiasm we're seeing today in the marketplace, I don't believe that electric vehicles can realistically achieve much more than a 3%-4% market penetration within the next ten years. And that's being very optimistic.

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Now this has nothing to do with demand, or the reliability of the vehicles or the battery technology...

In fact battery technology is absolutely going to advance by leaps and bounds over the next decade.

Of course, I realize that battery technology remains to be a major sticking point for those who don't believe that EVs have much of chance. And in all fairness, there are still many challenges ahead when it comes to high performance battery technology.

But it's one thing to objectively recognize technological barriers early on, and work to overcome those barriers.

It's another to dismiss an entire market altogether because the technology is still developing.

If we all adhered to that mentality, we'd still be using typewriters and rotary phones.

That being said, the need to reduce our oil consumption is an urgent one. We don't have time to wait around for an electric car with a 500-mile range and quick charging capabilities at gas stations.

With each passing day — and each barrel consumed — we become more and more vulnerable.

And that's why we're so focused on capitalizing on every potential (and responsible) solution to this problem.

From electric vehicles and next-generation biofuels (using non-food crops) to mass transit, high-speed rail and more walkable communities, we need to responsibly embrace it all.

I would even argue that the continued development of modern-day internal combustion and conventional hybrid vehicles can also play a crucial role in our quest to curb our appetite for oil.

How's 1.8 billion barrels grab ya?

I thought it was disturbingly amusing last year when we watched a handful of bureaucratic dolts on the Hill fighting against the increase of the corporate average fuel economy standard (CAFE) to 35.5 mpg.

Why would you fight against something that helps us curb our oil consumption?

Why would you fight against something that is expected to save 1.8 billion barrels of oil over the life of all new passenger vehicles sold during the five years between 2012 and 2016?

That's more than our 2008 combined imports from Saudi Arabia, Venezuela, Libya, and Nigeria.

Regardless, here we are today — with modern hybrid and conventional ICE vehicles on the market already exceeding, or coming pretty damn close to, those mandated CAFE standards.

Take a look at this top ten list of most fuel-efficient cars of 2010, as reported by the EPA:

Toyota Prius Hybrid – 51/48 mpg
Ford Fusion Hybrid and Mercury Milan Hybrid – 41/36 mpg
Honda Civic Hybird – 40/45 mpg
Honda Insight Hybrid – 40/43 mpg
Lexus HS250h Hybrid – 35/34
Nissan Altima Hybrid – 35/33 mpg
Ford Escape Hybrid, Mazda Tribute Hybrid, Mercury Mariner Hybrid – 33/41 mpg
Smart fortwo – 33/41 mpg
Toyota Camry Hybrid – 33/34 mpg
Lexus RX450h Hybrid – 32/28 mpg

And it's only going to get better.

In fact Nissan (NSANY.PK) announced on Tuesday that its latest hybrid offering — a hybrid version of the Fuga sedan — will likely be between 60% and 90% more fuel-efficient than the gas-powered model.

While it won't give you as many miles per gallon as the Prius, Nissan has upped the ante with new operational and design changes that could be integrated into the next generation of hybrids.

For instance, Nissan's hybrid system is about 66 pounds lighter than Toyota's system. Nissan's model also uses one electric motor, whereas Toyota uses two.

And according to Nissan chief engineer Koichi Hayasaki, beyond providing significant weight reduction, these changes provide cost reduction, too, as the Nissan system is just simpler than Toyota's.

As a side note, Toyota is often used as the base comparison, as it is the most fuel-efficient hybrid on the road today.

Everything from advances in battery technology to basic design changes to lighter weight materials will continue to be incorporated into new hybrid vehicles as we move forward..

And with these advances, we will see continued progress in efficiency, continued reductions in oil consumption, and continued opportunities for Green Chip investors.

To a new way of life, and a new generation of wealth...

Jeff

P.S. Nearly every new hybrid coming to market after next year will be using lithium-ion batteries. But lithium-ion batteries are also being used for utility-scale storage — allowing solar and wind to potentially become providers of baseload power. It's just like coal, but cleaner and cheaper. To learn more about lithium-ion storage — as well as 10 other storage technologies — check out our free Energy Storage Report.

Carbon Emissions Investing

Last Friday, I had a conversation with an old friend of mine who now lives in China.

A life-long environmentalist and diehard capitalist, she has made a ton of dough working as a consultant on alternative energy projects all over the world.

From wind farms in the UK to infrastructure development in Beijing, she has never made it a secret that her most lucrative deals always come from places where policy support for alternative energy is the strongest

And those places are where the government welcomes alternative energy funding, instead of chasing it away by providing limited or no long-term visibility.

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This is why she has spent very little time in the United States over the past five years. But based on our conversation last week, she's surprisingly optimistic about a potential return to her home state of Ohio.

Apparently, she sees some real potential in the coming energy bill.

Unfortunately, I'm less enthusiastic. It's just hard for me to believe that anything meaningful can happen this close to an election.

You know how politicians are... Few ever have the cojones to take a stand and do what's right for the country — and not their contributors — during non-election years. The level of complacency and fake smiles just kicks into overdrive during an election year.

That being said, my refreshingly optimistic friend did make a very good point that I want to share with you today.

Because if she's right, then the result of this bill will dictate where we place our bets.

Just another energy tax?

The thorn in the side of this energy bill has always been the issue of putting a price on emissions. Supporters say that it is necessary to rein in those often ignored external costs that keep coal-fired power artificially low.

Opponents argue that putting a price on emissions would cause the price of power to skyrocket and hurt taxpayers.

Although if we truly value a free market, then I would argue that all costs related to power production must be figured into the equation, and not externalized.

As well, tax payers are already getting fleeced on the coal deal, since we've been subsidizing the stuff for decades. Why does an industry that is established and profitable need continued subsidies?

Nonetheless, the two sides of this debate are not likely to hold hands anytime soon. But there's a lot of money sitting on the sidelines right now; money that the utilities are ready to invest into cleaner energy alternatives.

And they can't move until Washington gets off its complacent ass and actually implements some kind of carbon limit legislation.

Look, whether you think climate change is real or not, at some point there will be limits on CO2 emissions.

That's a fact, and any investor who can't grasp this reality because he or she is too busy bashing Al Gore or reciting Rush Limbaugh quotes is going to miss out on a lot of money.

The utilities know that this is coming, and they're actually eager to get moving on this very necessary transition.

Now we know that there's no chance of an economy-wide cap and trade with this bill. It's just not going to happen.

But in an effort to get something passed, many are expecting to see a bill that calls for putting CO2 limits on utilities first, then moving on to other industries at a later date. And quite a few utilities are actually supporting this idea.

In fact Duke Energy's (NYSE: DUK) Jim Rogers said that they're willing to start early, as long as an economy-wide limit is eventually integrated.

Not too much to ask, considering that the utilities actually emit less than half (about 40 percent) of U.S. greenhouse gas emissions. There are a number of other industries that make up the other 60 percent.

If both sides of the aisle can actually come together on this compromise, expect to see a flood of backed up capital flow into solar, transmission and energy efficiency and conservation technology... Because the utilities will finally have the green light they need to move forward.

Some of the companies we see as being able to benefit include:

First Solar (NASDAQ: FSLR)
EnerNOC (NASDAQ: ENOC)
Comverge (NASDAQ: COMV)
Itron (NASDAQ: ITRI)
ITC Holdings Corp. (NYSE: ITC)

Of course, while my optimistic friend believes there's a pretty good chance this compromise will lead to actual legislation, I'm reminded every day by the dishonest rhetoric in the media that this is far from a done deal...

Many politicians are still screaming about how this would be nothing more than a national energy tax. Of course they say nothing about the current “national energy tax” that goes to support the welfare scam that rewards King Coal and Big Oil with fat subsidies while quietly swindling tax payers...

No — we don't hear about those taxpayer-funded subsidies because that would force the nation to re-evaluate the price we're really paying for energy.

I don't suspect anyone in Washington is going to call attention to our already subsidized fossil fuel machine. But I do believe that at some point, there will be a price on carbon.

When that happens, the nation's utilities are going to ignite some major movement for a handful of Green Chip stocks.

And we'll be there to reap the rewards.

To a new way of life, and a new generation of wealth...

Jeff