Yesterday it was announced that Holzer & Fistel LLC was investigating possible federal securities violations of JA Solar (JASO) due to a failure to disclose in a timely manner that it had purchased a $100 million 3 month note from Lehman Bros. at a time when LEH was under severe financial distress. 

After the bell today, Coughlin Stoia Geller Rudman & Robbins LLP announced a class action lawsuit in New York on behalf of purchasers of the ADS shares of JASO during the period of Aug 12 2008 - Nov 12 2008.

According to the complaint, defendants failed to disclose: (i) that JA Solar had made a material, highly speculative investment in a subsidiary of Lehman Brothers, an entity that was then undergoing a credit crisis and under significant financial distress; (ii) that the value of JA Solar’s investment in the Lehman note had diminished considerably; and (iii) that, as a result of the foregoing, defendants’ positive statements concerning JA Solar’s financial performance, outlook and earnings guidance were materially false and misleading and without reasonable basis.

JA Solar didn’t disclose the note and write off until Nov 12th.  The stock gapped down that day and closed near the lows at 2.38, eventually hitting an all time low of 1.55 about a week later.  Since then, the stock has more than doubled and currently trades at 3.61/share.

Aerovironment (AVAV) which has been one of a few bright spots in the green sector of late, reported outstanding earnings results after the bell today.  They beating analyst EPS estimates of .27/share by .14 (71% increase over year ago quarter) on revenues of 65.8 million (22% growth over year ago quarter) which was slightly ahead of estimates. The company is maintaining revenue growth guidance for 2009 of 20 - 25% growth.

While the company is involved in renewable energies with its rooftop wind turbine systems and electric vehicle charging stations, the growth driver remains its unmanned aircraft systems.

“Our second quarter results reflect strong, effective performance and continued diversity within our unmanned aircraft systems portfolio. The underlying demand for our unique unmanned aircraft system solutions is driving procurement, service and research and development revenue,” said Tim Conver, CEO of AVAV. “Both our UAS and EES segments performed well, resulting in record quarterly revenue and a healthy operating margin. EES, in particular, benefited from product mix and operating efficiencies to deliver a strong gross margin. Supported by a considerable cash reserve and no debt, our team executed well against our business strategy while robust customer demand and our product development pipeline position us very well for continued growth.”

The stock continues to be one of the few that trades above its 200 day moving average and should see a pop tomorrow sending it above the 50 day moving average as well. 

Constellation Energy announced that it has received a proposal from Électricite de France (EDF). If the proposal is accepted, EDF would buy a 50% share in Constellation for $4.5 billion. Constellation’s Board of Directors will review the proposal, but at this time they are still recommending that shareholders vote for the planned merger with MidAmerican Energy Holdings Company.

Here’s an overview of the proposal from EDF:

• EDF would purchase a 50% ownership interest in the nuclear generation and operation business of Constellation Energy (excluding Constellation Energy’s existing interest in the UniStar joint venture) for $4.5 billion, subject to certain adjustments;
• EDF would make an immediate $1 billion cash investment in Constellation Energy in the form of nonconvertible cumulative preferred stock, which subsequently would be credited against the $4.5 billion purchase price (with EDF surrendering the preferred stock to Constellation Energy as partial payment); and
• EDF would provide Constellation Energy with additional liquidity by entering into an asset put option pursuant to which Constellation Energy could, at its option, prior to EDF’s acquisition of the 50% interest in Constellation Energy’s nuclear generation and operation business, sell to EDF non-nuclear generation assets having an aggregate value of up to $2 billion.

Ascent Solar (ASTI) is announcing this morning that it has achieved greater than 9.5% efficiency for its thin film, flexible Copper, Indium, Gallium, Selenide (CIGS) integrated solar modules.

Lawrence Kazmerksi, Executive Director at NREL, said, “This is significant. Many doubted that a thin-film CIGS solar cell-on-plastic technology could be possible. Ascent Solar not only achieved this, but they now have confirmed efficiencies at NREL on fully integrated, monolithic prototype modules near 10%. This appears to be a substantial leap toward realizing high-performance, inexpensive thin-film solar photovoltaics.”

First Solar (FSLR) which uses a cadmium telluride technology for its thin film applications has said it achieves around 10.5% efficiency for its panels.  The bulkier, more traditional polysilicon based panels achieve a much higher rate of efficiency .. Sunpower has demonstrated solar cell efficiencies of over 20%.

Floyd Associates, a privately held consulting firm is out with a research report on the future of electric cars (disclaimer: FA is involved with business development of Phoenix Motorcars) which isn’t all that detailed but provides a good primer on the technologies involved and some of the smaller players hoping to emerge as future leaders of the electric car industry (or sell their technologies to existing major auto companies).  Below is an outline of the report with a few of my comments thrown in.

The Motors

- DC Brushless: high top speed, slow acceleration, lower cost
- AC Induction: average top speed, quick acceleration
- Permanent Magnet: average top speed and acceleration
- Switched Reluctance: most cost effective, but complex software needed

The Batteries

- Nickel-metal hydride: smaller size and higher performance than a lead acid battery
- Lithium ion: the future of car batteries is most likely the lithium ion due to its long life cycle and high energy density

Charging

Electric vehicles will most likely be charged in 5-6 hrs using a standard 220V outlet but Phoenix Motorcars has an EV capable of being 95% charged in 10 minutes but required a charging station

Tax Credits

As part of the Emergency Economic Stabilization Act of 2008 (known to many as “the bailout bill”), the government will provide a base tax credit of $2500 plus an additional $417 per kWh for batteries greater than 4kWh with a tax credit cap set at $7500.  Some states are offering incentives as well in order to get electric vehicles on the road in a hurry.  California offers a $5000 rebate while Oregon offers a $5000 tax credit. 

Electric Vehicle Manufacturers

- Phoenix Motorcars: privately held and based in California; uses lithium ion batteries; first to introduce electric SUV in 2006; recharge in 10 minutes with 100 miles distance at highway speeds; uses AltairNano (ALTI) batteries but no longer exclusively; uses UQM Technologies (UQM) motor technology (edit: the original UQM motor has been discarded in favor of a custom designed model); its vehicles are expensive ($50K) and you don’t hear much about Phoenix anymore

- Tesla Motors: private and based in California; focused on high performance; sports car has a range of 220 miles, top speed of 125 mph and can accelerate from 0 - 60 in 4 seconds; release continues to be pushed back because of production issues

- Th!nk Global: private company based in Norway and manufacturers the Th!nk City electric car; world’s only crash tested and highway certified car with a range of 125 miles and top speed of 65 mph; one of most affordable electric cars which is expected to be offered to US customers at $15 - $17K with a battery leasing fee of $200; Ener1 (HEV) will supply battery packs

- Aptera Motors: privately held and also based in California; offers 3 wheeled electric and hybrid vehicles; the hybrid one most fuel efficient in the world at 340 mpg; driving range of 120 miles for electric vehicle

Of course there are the big players such as Toyota (TM), Honda (HMC), General Motors (GM) and Ford (F), all of which will emerge on the scene with several models of electric vehicles within the next couple of years.  I can’t imagine the privately held companies mentioned above will exist on their own for too long.  The big auto manufacturers will have tremendous economies of scale advantages once they get going, not to mention government backing of the US manufacturers.  It will be mighty interesting to see how this industry develops over the next 4 years.

Zoltek (ZOLT), provider of carbon materials that go into the manufacturing of wind turbines reported results this morning that beat analyst estimates by .02/share when excluding a one time legal fee charge.  The company reported earnings of .22/share (10% below the year ago quarter) on revenues of 51 million, which was good for a 17% increase over the year ago quarter.

CEO Zsolt Rumy stated, “The fundamentals of alternative energy generally — and wind energy in particular — are extremely solid, with strong support from governments in Europe, Asia and North America. Wind energy has been growing at an average rate of 25% to 35% a year over the past several years, even when oil was selling for as little as $30 per barrel. We see no dramatic change in the outlook for 2009 and beyond. This business is predicted only to get bigger.”

ZOLT is trading down again today by about 4% and remains mired in a long downtrend.

Solarfun (SOLF) reported an EPS before one time provision adjustments of .16/share which represents a decline in growth over the year ago quarter for the first time in a few years but did beat low analyst expectations of .14/share.  Quarterly revenue came in at $187.8 million, good for an 88% increase over the year ago quarter but a bit below analyst estimates of 195 million.  The company sees Q4 shipments to be at or slightly below the low end of its previously stated guidance of 175 to 190 mw.

The CEO commented that a shortfall in polysilicon supplies constrained their ability to fulfill customer demand 

Harold Hoskens, CEO of Solarfun, commented on the impact of the financial crisis.  “Although current global economic and financial conditions remain uncertain, and we are not immune to these factors, we are maintaining a high degree of optimism in our ability to compete and grow in what we believe is undeniably a burgeoning market in the long-term as renewable energy continues to grow in acceptance. These macro conditions have impacted, and will continue to impact, the demand and pricing for photovoltaic-based solar products. However, we believe that the rapidly declining costs for polysilicon, combined with our low-cost manufacturing base, increasingly vertically integrated production process, customer loyalty and financial stability, will allow us to weather this environment and emerge as a stronger and viable long term player.

After opening down on the news, the stock recovered quickly and is currently trading up about 3%.  This looks to be another example of the bad news already built into the stock.

Clean Energy Fuels (CLNE) has been awarded a 10 year contract by the city of Glendale, California to build, maintain and operate a public access natural gas fueling station that will be used to serve public transit buses, municipal vehicles, hauling trucks, taxis, shuttle buses and passenger cars near the Bob Hope airport.   It will potentially dispense 800K gallons annually as Glendale’s goal replacing all of its diesel powered fleet vehicles with CNG vehicles over the next few years becomes a reality. 

James Harger, CLNE Senior VP said “For many years the City of Glendale has been a dedicated user of clean-burning natural gas fuel, as evidenced by its extensive fleet of CNG-powered transit buses, refuse trucks, street sweepers and light-duty municipal vehicles. The City’s level of commitment continues to expand, as evidenced by the City’s recent announcement that it plans to replace its entire fleet of diesel refuse trucks with CNG-powered models over the next five years, a move which will contribute significantly to boosting local efforts to curtail air pollution and greenhouse gas emissions.”

The news didn’t help the stock though.. it traded off more than 16% and is once again closing in all time lows around $4 bucks a share.

SunPower (SPWRA) announced early this morning a new contract with City Solar of Germany in which SPWRA will provide them with 100MW of solar panels along with commercial rooftop and ground mounted systems over the next 3 years.

Steffen Kammler, City Solar’s President and Chief Executive Officer, said, “With this deal, we can offer our commercial customers SunPower’s high-efficiency solar panels and patented rooftop and ground mounted tracking systems, which can significantly increase their energy output.”

The news didn’t help SunPower any today as the stock was battered along with the rest of the market, finishing down nearly 18% and looking to test the lows around 20 in the coming days.

First Solar (FSLR) has announced that it has completed production on a 2MW solar power plant for Southern California Edison which was installed on the rooftop of a commercial building in Fontana, California.  It’s the first project for SCE within a larger plan to install 250MW of solar power across commercial rooftops throughout Cali over the next 5 years.  First Solar (FSLR) will also engineer, manufacture and install the next project in Chino, expected to be a 1MW plant. 

“This innovative solar rooftop initiative is a natural extension of our industry leadership in renewable energy,” said Ted Craver, Edison International chairman and CEO. “We are driving solar technology forward and identifying creative new ways to integrate solar power into the electricity grid. A program of this scale could transform solar generation, helping bring costs down and providing us with another important way to meet the environmental challenges of the future.”