Here’s a quick guide to the three main types of ASX-listed CleanTech stocks
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From clean energy generators to battery makers to power managers, a class of ASX-listed “cleantech” stocks is rising to meet not only socially conscious investment needs, but tackle a shift towards renewable energy.
CleanTech refers to “economically viable products, services and processes that harness renewable materials and energy sources, dramatically reduce the use of natural resources and cut or eliminate emissions and wastes”, according to advisory Australian CleanTech.
>> Scroll down for a list of ASX cleantech stocks
A Bloomberg New Energy Finance report this week predicted coal will have “all but disappeared” within 30 years.
Rooftop and other kinds of consumer solar, alongside “behind the meter” storage, will make up 44 per cent of all energy capacity. “Behind the meter” refers to renewable energy systems such as solar power units intended for on-site use.
Bloomberg believes Australia will become one of the most “decentralised” power systems in the world. In other words, energy will be commonly produced locally — close to where it’s used, rather than at large, remote plants.
“Solar and wind are unquestionably here to stay,” says Rob Fisher, CFO of wind energy producer Windlab (ASX:WND). “The cheapest technologies are the ones that are used — and right now that’s wind and solar.”
Here’s a quick guide to ASX-listed CleanTech stocks — divided into power generators, energy managers and battery makers
Australia has about 7GW of utility renewable energy installed — and another 35GW of solar projects in the pipeline.
Some of these are being built on spec like the Moree Solar Farm in NSW — a merchant power producer model where they sell energy into the spot market.
Others are backed by contracts such as Windlab’s Kennedy Energy Park deal with Queensland government owned CS Energy. Under another model, companies might build their own and fund the development over time through utility bill payments.
Among the ASX’s energy generators, there are about a dozen or so small caps focused on generating renewable energy:
AusNet Services (ASX:AST) installs rooftop or commercial solar panels and batteries.
Zenith Energy (ASX:ZEN) designs hybrid energy systems particularly for isolated mining sites.
Volt Power (ASX:VPR) offers solar power LED lighting and wifi for isolated sites, and waste heat-to-power generators.
Pacific Energy (ASX:PEA) has branched into grid-connected hydro power in Victoria.
Carnegie Clean Energy (ASX:CCE) started out with wave power technology, which it is still developing, but has also added a solar and storage business to capitalise on demand from the resource sector.
Windlab (ASX:WND) has projects on the go in Australia, the US, South Africa, Kenya and Tanzania.
ReNu Energy (ASX:RNE) used to be called Geodynamics and wanted to develop a geothermal plant in South Australia. It closed that down, changed it name and by 2017 became a solar energy company.
The geothermal theme is still hot however as Petratherm (ASX:PTR) believes it can make a go of this technology in Australia, Spain and China.
Kalina Power (ASX:KPO) has also just signed a geothermal power deal (in the US this time), but has technology that turns waste heat into energy.
New Energy Solar (ASX:NEW) doesn’t build power plants, it buys them and reaps the dividends over time. Once a solar or wind plant is built, they require very little capital as the energy source is free, making the power sales almost annuity-like.
Genex Power (ASX:GNX) is building an ambitious wind, solar and pumped hydro farm at the Kidston project in Queensland. Experts say it’s well placed for hydro and wind, but the trick will be getting the energy to a market that really needs it — NSW and Victoria.
Tilt Renewables (ASX:TLT) is a kiwi company with technology that ‘tilts’ wind turbines and solar panels in the direction of the energy source. It has functioning and under-construction plants in Australia and New Zealand.
Enviromission (ASX:EVM) is perhaps the most ambitious of the renewable generators. It is pitching a solar tower — a tower that draws hot air in at the bottom and cause a thermal updraft that will turn turbines. Its first target location is the US.
Energy managers try to help homes and businesses understand and use the data generated by their smart meters and homes to make better decisions about how they use energy.
Effectively, this is a method of demand response where people can use the data from the building they are in to choose when to use high-energy appliances and machines.
As more smart meters are installed demand for software that helps people effectively use them is expected to rise rapidly.
Simble (ASX:SIS), BidEnergy (ASX:BID), BuildingIQ (ASX:BIQ), Buddy platform (ASX:BUD) and EnergyOne (ASX:EOL) all perform a variation of this theme, be it for business or homes.
Australia has a surprising number of battery makers, given the lithium-ion part of the industry is now a mass production field centered in low-cost countries.
Two are competing in the lithium ion space, two with flow batteries, one provides grid-scale services, one is a battery tester, and the last has a technology that is experimental.
Ultracharge (ASX:UTR) and Magnis Resources (ASX:MNS) are both making versions of lithium-ion batteries. The former has changed the make-up of the battery to allow it to charge faster, while the latter is planning gigafactories in New York, Germany and Australia.
Redflow (ASX:RFX) and Protean (ASX:POW) are making versions of a flow battery, a storage unit that can completely discharge without being damaged and has a considerably longer life span than a lithium-ion battery — although it also takes longer to discharge energy.
Tag Pacific (ASX:TAG) owns M Power which provides energy services. One of its projects involves providing a grid-scale battery for a housing development in NSW so the developer can delay installing an expensive substation.
Novonix (ASX:NVX) last year changed its name and entered the battery testing space.
1414 Degrees (ASX:14D) is the most ambitious of the ASX battery makers. It is pitching to investors a technology that involves storing energy in molten silicon.