3 Signs Your Solar Investment Is All Wrong

2013 was an enormous growth year for solar -- but not everyone's in on it.

May 4, 2014 at 10:10AM

Solar Fix

Source: PG&E. 

Solar energy is soaring, and 2013 was no exception. A new report from the Solar Electric Power Association reveals three of the latest solar trends, and they've got little to do with residential rooftops. Here's what you need to know.

1. 2013 was a stellar year for solar
It's been a long time coming, but solar is finally getting some serious scale. Before 2013, solar capacity clocked in at 6,298 MW. While that might seem like an impressive number, it accounts for around 1.3% of our nation's total 467,900 MW of generation capacity. 

But with 4,211 MW of new capacity added in 2013 alone, that percentage jumped to around 2.2%. And while that's hardly on par with wind energy or stalwarts like nuclear, coal, and natural gas, it's making solar increasingly hard to sneeze at.

2. Utilities are running the solar show
Investors are pouring money into solar growth stocks that promise to blanket every residential rooftop with a solar panel. And while this may someday be the case, utilities have finally gotten the message -- and they're not leaving solar generation to regular citizens. In 2013, utility-scale solar installations maxed out at 2,627 MW -- nearly four times residential's relatively lackluster 679 MW. The U.S. Energy Information Administration's (EIA) numbers put utility capacity additions even higher (2,959 MW), but the additions are enormous, either way.

Utility Capacity Additions

Source: EIA.gov. 

3. Not everyone's stoked about solar
Despite federal tax credits, improved technology, and increasingly expensive traditional fuels, solar isn't for everyone. California-based PG&E (NYSE:PCG) topped the list of utilities for 2013 solar capacity additions, increasing its stake by a whopping 1,471 MW. With Sempra Energy's (NYSE:SRE) San Diego Gas & Electric Company in second place with 643 MW, it's easy enough to see where the sun's shining brightest. 

California's solar capacity clocks in at 5,537 MW -- just over half that of the country's entire capacity. Compare that to 10th-place Florida, which boasts just 188 MW, and the story of concentrated solar growth becomes increasingly clear. 

California's own sunny weather creates a good starting point for solar, but it's the state's regulators and support structure that have truly pushed its capacity forward. The California Solar Initiative has set a goal of 3,000 new MW of solar power by 2017, and the California Public Utilities Commission has allocated over $2.1 billion in incentives to boost capacity. 

Where to invest?
If you're looking for a solar investment with steadier growth and smaller risk than rooftop start-ups, utilities are an increasingly attractive option. Their regulated earnings, long-term power purchase agreements, and pre-scaled infrastructure give investors the option of a stable solar stake. Utilities have shown solar investors they mean business -- and in 2014 and beyond, it could prove to be a profitable business indeed.

Top dividend stocks for the next decade
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Justin Loiseau has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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