First Solar, Inc. (FSLR), Zoltek Companies, Inc. (ZOLT): Make an Investment in Your Grandchildren’s Future

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First Solar (FSLR)

Remember that time when the world generated all of its energy, transportation fuels, and chemicals from renewable sources? Me neither, but that doesn’t mean the technologies enabling that disruptive future are pipe dreams. To be honest we have no idea what technologies will take center stage in 20 or 30 years. Heck, virtually no one — and that includes the mighty Energy Information Administration — foresaw the shale oil and gas boom just 10 years ago. The institution’s “Annual Energy Outlook 2002: With Projections to 2020″ (link opens PDF) states: “Although projected natural gas demand in 2020 is 1.0 trillion cubic feet lower than was projected in AEO2001, the price is expected to be higher due to a less optimistic assessment of natural gas reserves discovered by exploratory drilling.”

I think that sets the tone as we attempt to peek into the future while keeping our humility intact. Nevertheless, each technology discussed below has broad market support, major investment from public and private institutions, and a growing pile of scientific data behind it — all of which are needed to ride the waves of time. Here are five companies working toward creating a better world for your grandchildren to live in.

When I was your age, coal generated electricity…
Since 2005, total domestic energy production from solar and wind have grown by a compounded annual growth rate of 21% and 29%, respectively. Despite being in high-growth mode, total installed solar capacity sits at just 7.7 GW, although wind has a respectable 60 GW of capacity. That means little when the sun doesn’t shine or the wind doesn’t bluster on by (resulting in lower utilization rates), but utilities cannot beat free fuel inputs!

Cadmium telluride (CdTe) thin-film solar module pioneer First Solar, Inc. (NASDAQ:FSLR) is a great bet on a sun-powered future. The company has fallen from de facto industry leader in recent years in light of cheap Chinese competition and market uncertainty. Competition can never be overlooked, but the company maintains the cheapest manufacturing costs in the industry and should benefit from extra production capacity leaving the market via bankruptcies. While we can acknowledge that CdTe semiconductor technology will be improved upon in the coming years, it remains at the top of the charts for energy and cost efficiency and sports the shortest energy payback period.

Source: First Solar, Inc. (NASDAQ:FSLR)

The nation’s solar capacity may be a laughably small number, but consider that electricity generation from wind has grown from just 6 billion kWh in 2000 to 120 billion kWh in 2011. That doesn’t account for a record 13.2 GW of capacity additions made last year, which will begin to show-up in electricity generation in 2013.

What’s behind the more than 20-fold improvement? Cheaper, lighter, and more efficient turbines enabled by companies such as carbon fiber manufacturer Zoltek Companies, Inc. (NASDAQ:ZOLT). The company’s carbon fiber wind turbine blades, which capture three times the power generation of comparable glass fiber blades, own a virtual monopoly on the industry’s largest turbines. That should bode well for Zoltek given the nation’s estimated wind-generating potential — both onshore and offshore — of nearly 14,550 GW. Tapping just one-tenth of that total would provide 73% of the country’s electricity demand.

Vroom, vroom into the future
Zoltek Companies, Inc. (NASDAQ:ZOLT) can also manufacture up to 100,000 super-strong and lightweight compressed natural gas, or CNG, fuel tanks each year. That will be just an important piece of the puzzle allowing Clean Energy Fuels Corp (NASDAQ:CLNE) to disrupt the transportation industry. For now the company will forgo consumer vehicles until a broader market exists and instead focus on the trucking industry. Clean Energy Fuels will boast 150 fueling stations in North America by the end of 2013.

CNG and LNG are not perfect fuels, but they can be sourced domestically — and metropolitan transit agencies are taking notice. In fact, one-in-four transit buses on order today are powered by natural gas. Natural gas vehicles will continue to rise in popularity as more companies determine how to best corral the widely abundant energy source. However, that doesn’t mean they’ll be the only internal combustion engine alternative taking to the roads a few decades from now.

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