Shares of wind power equipment manufacturer, Broadwind Energy, Inc. were up about 37 percent from Friday’s close, in morning trading on Tuesday, after the company announced its subsidiary, Tower Tech, Inc., was selected by Gamesa Technology Corp., a wholly owned U.S. subsidiary of Gamesa Corporacion Tecnologica, to supply structural wind towers for wind sites in the U.S. The towers are expected to be installed in the fourth quarter. The value of the contract was not disclosed.
“Proven experience, flexibility and well-established competencies were key elements in our decision to select Broadwind’s Tower Tech subsidiary to construct our next-generation towers for these projects,” said Jim Buddelmeyer, vice president of purchasing at Gamesa.
The Gamesa deal doesn’t relate directly to sales of wind turbines by Broadwind Energy, Inc., but it was much-needed good news for the green energy stock, which has lost more than half of its value year-to-date.
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Last year was a record-breaking year for the wind power industry, with about 9.8 gigawatts installed. But the industry is in for a 40 to 60% drop this year, with analysts expecting anywhere from 6.3 GW to 7.1 GW to be installed. Key states including Texas, Minnesota and California have historically been wind hot spots. However, tepid utility demand, inexpensive natural gas and transmission congestion have led to a reduction in the number of power purchase agreements that have been signed. While the U.S. has expansive coastal wind resources, offshore is expected to account for only 5 percent of installations by 2025.
Although there have been unprecedented levels of federal support for wind energy, without a federal renewable portfolio standard [RPS] and streamlined transmission and siting processes, the time for projects to become operational will be greatly delayed. According to Bloomberg New Energy Finance: “To compete in the era of low-priced natural gas, the levelised cost of wind generation must drop substantially on a MWh basis. This means the industry cannot sit on its laurels but must re-dedicate itself to technological innovation.”
Trading in Broadwind shares remains volatile, however, trading well below the $8.12 share price at which Broadwind Energy was trading at the onset of 2010. Broadwind shares have traded at $4.00 or below since March.
Broadwind Energy, Inc. was first covered as Buzz Stock of the Day in June 2009, after the company announced a realignment of its management team to advance its business development, international and technology efforts.
Monday: Our Buzz Stock of the Day on June 28, IDT Corp. (NYSE: IDT) had a great week. IDT, which blends a strange pairing of telecom and energy had positive momentum
Shares of Pacific Ethanol, Inc. (Nasdaq: PEIX) were up almost 60 percent from Tuesday’s close in morning trading on Wednesday, after the company said that four of its wholly-owned subsidiaries had emerged from bankruptcy.
For all you penny stock traders, here are a few penny Buzz Stocks we’re watching today:
Telecom and oil are an unlikely pair. But for IDT Corp. (NYSE: IDT). which specializes in telecom services and oil exploration, the combination has worked well. Shares of IDT Corp. were up 13 percent from Friday’s close, likely because of a new CNBC interview with the company’s founder, chairman and CEO, Howard Jonas that outlined the company’s oil shale venture in Colorado (below).