Alternative Energy Expert Sees Huge Growth Ahead
November 16, 2009 - The Wall Street Transcript has just published Alternative Energy/Clean Energy/Power Generation/Utilities Report offering a timely review of the Energy sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.
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Walter Nasdeo is Director of Research for Ardour Capital Investments in New York, and he supervises the firm's Energy Technology Group. Mr. Nasdeo joined Ardour Capital from BlueStone Capital, where he was a Vice President of Research and headed the energy technology team. Prior to BlueStone, he was at Credit Lyonnais Securities, where he researched consolidating industries. Mr. Nasdeo has appeared numerous times on CNBC's "Closing Bell" and "Power Lunch," Bloomberg Television, BBC and ROB-TV, and he has presented at various energy technology conferences. He received his MBA and his BBA in entrepreneurship from the University of North Texas.
TWST: How can an investor identify companies that have good, strong business models versus those that don't and are too reliant on subsidies?
Mr. Nasdeo: Yes, but first I need to address your "too reliant on subsidies" comment, which is a comment that I get. I've been doing this for a long time. I started doing equity research in alternative energy companies back in the mid 1990s. We started Ardour Capital in 2002 to do nothing but alternative energy, and not a week has gone by that I haven't gotten that, "Yeah, it's really cool, but as long as oil is at this level or as long as natural gas is at that level, it's never going to be viable." My comment to that is if you want to do away with subsidies, I would be all for that, let's do away with all energy-related subsidies, which means all the subsidies that go into the oil industry which are significant from the wellhead to the gas pump, those subsidies dwarf anything that's ever been devoted to alternative energy. It has to be because if not, then gasoline would be probably $13 or $14 a gallon, because there are a lot of steps from the oil coming out of the ground to the guy pumping it into your tank.
That being said, there is no doubt that at this point in the life of alternative energy, it needs the support of government subsidies to get over the hump. Now I'll also say to you that for quite a while, the companies haven't done themselves a whole lot of favors because in many instances, they haven't been judicious in the deployment of these technologies. If you really want to do this correctly, you need to put the solar where sun shines, you need to put the wind turbines where the wind blows. There is not one panacea or ubiquitous technology here. They are suited for certain areas, and if you put them in the areas where they will be successful, they are very successful. The Northeast is not the best place to be deploying solar - it will work by all means, but you won't get the efficiency that you are going to get in the Southwest. And when you look at it, then you start calculating things like payback periods, and they get extremely extrapolated because you're not getting the output from the level of sun. Same thing with the wind.
So I would say to you there is a place for a fuel cell, there is a place for wind, there is a place for micro-turbines, and solar and hydroelectric, and geothermal, and if you put them where they are meant to be put, they provide very good solutions.
Note: Opinions and recommendations are as of 09/01/09.
WALTER NASDEO
Director of Research
Ardour Capital Investments, LLC
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