Ecotality Life

What could be a better idea than a building feature holding down two jobs: letting the sunshine in and generating electricity?

In addition to hard-working, this feature is aesthetically pleasing (check out the photo above). Function without sacrificing form. Though I’m sorry to inform all the eligible buildings out there that this particular feature – a solar skylight system — is taken. However, Suntech Power can play matchmaker if you’re in search of your solar-mate.

Suntech Power Holdings Co. (NYSE: STP), one of the world’s leading manufacturers of photovoltaic (PV) solar systems, announced on October 16 that it supplied a building-integrated photovoltaic (BIPV) skylight system to Recreational Equipment, Inc. (REI), a U.S. retail cooperative providing outdoor gear and clothing, for REI’s “green prototype” store. This is the first such feature in a retail occupancy.

REI’s green prototype store, located in Boulder, CO., opened on October 5. Findings from the “working green laboratory” will help REI make decisions on how it approaches green building design and construction in the future. The store is designed to meet the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) Silver standards for commercial interiors. (Check out Sarah Boll’s post, Green Building: What is LEED?)

A few of the innovative green features in the building:

• The solar skylight system (in photo) – “comprised of a highly aesthetic laminated glass product integrated with crystalline photovoltaic cells. In contrast to standard PV modules, the semi-transparent BIPV glass panels transmit light at the same time as generating solar electricity.”
• Passive solar lighting – “Natural daylight is channeled throughout the store through “Solatubes” (designed specifically for REI) while store lighting automatically dims or turns off during the day. Solatubes (these are neat – check them out!) will save the store more than 20% in its energy costs.”
• Solar hot water system — “will meet 70% of the store’s hot water needs.”

Click here for “guided tour” to view all the features of this green prototype store

I can’t say enough about REI: high-quality and attractive products; helpful, yet non-intrusive, salespeople; wonderful benefits provided to employees; cool adventure trips in scenic places; a leader in green building, clean energy, etc.

Supposedly, the best entice-the-reader combo is sex, power and money. I don’t buy into that (ok, well, I don’t believe it holds true for me or for anyone reading our site and my posts, but for the rest of the general public…<smile>). But, if true, we’ve had sex (of the G-rated romance between inanimate objects variety) and power (of the solar variety). Where’s the money?

REI is a cooperate, not a publicly-traded company, so, while you can save yourself money (by getting a discount on product purchases) by joining the cooperative, you can’t invest in the company. Suntech Power, however, is a publicly-traded company, trading on the New York Stock Exchange (NYSE) under the ticker symbol “STP.” The stock is up 79% over the past 1-year period.

Some key points and stats about STP:

Positives:

• Company size — As previously noted, one of the largest PV solar companies ($7.2 billion market cap) — size brings economies of scale and (often) political power (reportedly, especially true in China, where this company is based)
• Case in point (as per political note above) — STP has the exclusive contract to supply a 130KW solar energy system for Beijing’s Bird’s Nest Stadium, the main stadium for the 2008 Beijing Olympic Games
• Huge revenue growth — revenue for latest quarter up 148% over same quarter of last year
• Company is currently profitable — not true for many alternative energy companies
• Earnings (profit) growth — earnings for latest quarter up 56% over same quarter of last year
• Strong insider ownership — company insiders own 39% of its stock
• Silicon supply — company has contract for long-term supply of silicon (silicon is in short supply, so companies with long-term purchase contracts have locked in better prices than those companies who have to buy on the “spot” market; of course, this scenario could flip if/when there is a silicon glut)
• Reasonable stock price valuation — trailing (12 month) P/E ratio is 59; forward P/E ratio is 29. Latest earnings growth, again, is 56%. So, current PEG (59/56) is just a tad over 1.
• Strong stock performance on Fri. October 19, a very big “down” day — stock hit a new high, but then closed down just a bit (less than 1/2%) while the market got clobbered (down over 2-1/2%). One day is just one day, but strong support in light of such a sell-off, especially when other solar stocks took decent hits, is a good sign.

Drawbacks & Potentional Drawbacks:

• Profit margins are shrinking — revenue growth is faster than earnings growth (this is rather typical for an early-stage growth company; however, if this situation does not reverse itself in the near future, this will be a negative)
• Potential innovation issues — STP is involved in second-generation PV solar and only spends just over 6% of revenue on R&D, while some other solar companies are now involved in third- and fourth-generation R&D, so those potential innovations must be watched along with STP’s own R&D efforts.

STP’s press release re: REI solar skylight

REI’s press release re: opening of its green prototype store

Dislosure: I don’t have any stock positions in STP.

Photo: Thanks to Bethany over at REI’s Publicity Dept. who supplied me with several great photos, including the one in this post.

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