Market Missed Last Week’s ‘Hottest’ News, But Google’s Interest in Geothermal Won’t Be Overlooked for Long

By admin | August 25, 2008

“It’s a big resource, it’s got a good cost curve, and it’s not getting enough attention.” So said Dan Reicher, director of climate and energy initiatives for Google’s philanthropic arm, Google.org, when he announced last week that Google is investing $10 million in companies developing technologies for exploiting geothermal energy – aka, the earth’s own heat – the one renewable energy source currently capable of substituting for coal and nuclear plants as a 24-7 source of electricity.

Perhaps if the Google announcement had been last week’s only news regarding geothermal power, the stock market’s lukewarm response might be understandable. But also last week the Australian government announced a $43 million project to develop technology for converting geothermal energy into what is called baseload electricity. In addition, the noted Washington, D.C.-based environmental organization, Earth Policy Institute, issued a report headlined, “World Geothermal Power Generation Nearing Eruption.” Among other things, the report noted that, “Current development is only scratching the surface of what is possible. . . . (A)s more and more national leaders begin to see renewable energy as a cost-effective, low-carbon alternative to price-volatile, carbon-intensive fossil fuels, geothermal power generation is expected to move rapidly from marginal to mainstream.”

For investors, the takeaway is that support for geothermal is pushing up, and it may not be long before the stocks of leading geothermal power developers do, too.

There are several, including the two that seem to get the most market attention, Ormat Technologies Inc., which trades on the New York Stock Exchange, and Geodynamics Ltd., which trades on the Australian exchange. (For more on them see Investor Alert (Part 2 of 2) – Stocks To Think About Buying Right Now: Ormat And Geodynamics)

But there are many other geothermal companies whose time may soon be at hand, among them: AMEX-traded US Geothermal Inc.; NASDAQ-traded Nevada Geothermal Power Inc., Sierra Geothermal and Razer Technologies; Western GeoPower, Corp., which trades on the TSX Venture Exchange; Canada’s Polaris Geothermal Inc., which trades on the Toronto exchange; plus other Australian-traded firms such as Petratherm Ltd. and Green Rock Energy Ltd.

Another geothermal-related company not to be overlooked is Iceland’s Glitnir banki hf, which Americans can buy on the OMX Stock Exchange. Glitnir plans to invest $1 billion in U.S. geothermal projects over the next five years. (For more on Glitnir see 10 Companies That Appear to Have a Chance to Hit It Big – #5 Glitnir banki hf)

For still more on geothermal see: Energy Analyst Dan Scotto: Geothermal Energy ‘Grossly Overlooked’ (Part 1 of 2).