Slippery Ted strikes again!

Written by Brian Hicks
Posted December 21, 2005

I suppose my critics felt somewhat vindicated after the House approved drilling in the Arctic National Wildlife Refuge (ANWR) on Monday. In fact, I even received a few "I told you so" e-mails that very afternoon from Wealth Daily readers.

Fair enough.

Listen, I'm not a mindless political drone quick to whine and cry because the vote didn't go my way. I'll leave that for all those who prefer to wear their politics on their car bumpers…

"Save the Whales" "Fur Hurts" "Don't blame me, I voted for (insert your favorite political whore here)" "Kill Osama" (Gee, thanks…before reading that bumper sticker, I never thought about how much I wanted Osama dead!)

In any event, I wish you could be a fly on the wall of the Wealth Daily office. Brian Hicks, our publisher, constantly challenges our assumptions. Every Tuesday we have a symposium on the issues of the day.

His latest is, "If I could transport environmentalists back in time, would they try to stop the continental plates from drifting to form what are today the 7 continents? Would they try to pin the blame of continental drift on man?"

I see Brian's point. But I'm not here to advance my environmental agenda. I'm here to observe the world, look at trends, and recommend investments based on my observations.

And that's been my argument all along. My argument is that regardless if we get oil from Alaska or not, it doesn't eliminate the fact that we need to find other sources of energy besides oil. And if that's the case, why allocate resources to an energy source whose supply is declining at a dramatic rate.

Capitalism, which I'm an advocate of, is the efficient allocation of resources. I think that the capital that'll be spent in Alaska drilling would be better serve developing a new source of energy. Period.

But at the last minute, slippery Ted and his minions managed to get the green light for ANWR drilling.

Now, all those who had a stake in that game are bouncing off the walls with excitement. You can't blame them - the kickbacks on this one must've been massive.

Gratify today - ignore tomorrow!

If they do start drilling in the ANWR, according to the U.S. Energy Information Administration, the oil would not flow into the market for 10 years. And by the time the refuge hits peak production, it'll be about 2025 - at which time it would cut U.S. oil imports to about 58 percent of demand. Just about 2 to 3 percent below the same percentage as current imports.

While those numbers may not sound too impressive - the instant gratification of new oil supplies and new jobs from the ANWR is.

But if you think for one second that drilling in the ANWR is anything more than a temporary solution to a problem that's big enough to bring the entire world to its knees - I have a Renoir I'd like you to see on my eBay site.

Unfortunately, there's still this mindset that discovering a small domestic oil field equates to energy independence.

But then what???

Listen, I do hope the oil in the ANWR provides some relief. But let's focus people!

This isn't a video game with a restart button that'll take us back to full reserves when things don't go our way.

There has never been a more important time for us to back renewable energy integration.

For one, a strong renewable energy infrastructure will provide further energy independence…provide more jobs…and provide a safer environment.

The second reason - and I feel confident this is the one you're most interested in, is the tremendous profit potential for renewable energy investors.

Don't worry - I won't chest pound too much today. At this point, my renewable energy portfolio speaks for itself!

Solar momentum

The morning I read about the ANWR drilling approval, I also got an interesting e-mail from a colleague of mine in California.

Turns out, in less than a month, the state of California could see about $3 billion worth of new solar initiatives.

You see, last week the California Public Utilities Commission (PUC) approved the first phase of the California Solar Initiative (CSI) which makes $300 million in funds available for 2005 and 2006 solar projects through its Self Generation Incentive Program. This is triple the amount of funding that was originally allocated for 2006.

But $300 million is just a drop in the bucket compared to the additional $2.9 billion the PUC is proposing for solar installations over the next 11 years.

The next vote for the larger CSI proposal will come on the 12th of January. Under the initiative, the PUC would provide $2.5 billion in customer incentives for solar projects for public buildings, agricultural facilities, industrial facilities and existing residential buildings.

The California Energy Commission would also provide $350 million of incentives for new homes. Gradually reduced over time, the incentives would phase out by 2016.

Funding for these initiatives would come from money that has already been set aside for solar power, as well as an additional surcharge on monthly electric bills over eleven years.

Now back in the 1970s, California was the world leader in solar energy. But since that time, Japan and Germany have taken the lead.

Of course, with the amount of available sun in California, coupled with high energy prices, dwindling oil supplies and an influx of renewable investment…some analysts are predicting that California could take the number two spot…just below Japan.

In the meantime, a number of other proactive states, like Arizona, Pennsylvania and New Jersey are also taking steps to drastically increase their solar generating capacity as well.

In fact, one of our solar plays just completed the first phase of a new solar energy system for the Atlantic County Utilities Authority in New Jersey.

This is the same company that delivered gains of 101% only a few months ago!

My point is this - go ahead and chalk one up for the bureaucrats and lobbyists. They'll have a nice Christmas, Alaskan oil workers will have something to do, Ted Stevens can move onto other issues important to him…like 'decency regulations' for cable television and satellite radio and frustrated Senate Democrats will cry and threaten filibusters. (If they're successful, I'll be amazed - as these guys tend to blow every political checkmate that comes their way)

But the market is still going to turn profits for renewable energy stocks.

And that's what all this boils down to.

Of course, if you're still not convinced that renewable energy stocks are hot - and more importantly, delivering huge gains for Green Chip investors, check out my FREE Green Chip Review service, where every day I'll send you further validation that 2006 will be the year renewable energy investors get rich!

Listen, I've been called everything from an overzealous environmentalist to a moneycentric capitalist pig - and I could care less. Because at the end of the day, I know where the money is in renewable energy. And I have the numbers to back it up.

Those who can look beyond the greenwashing and career politician hype long enough to realize that renewable energy integration can be profitable, will benefit from the world's energy crisis.

Savvy energy investors know that diversifying with renewables is what separates them from the stubborn traditionalists stuck in a money-sucking time warp.

Until next time,

Jeff Siegel
Editor, Green Chip Stocks