Unless you’ve been living under a rock for the past couple of months, you’ve heard all about the new energy bill. Before the last days of 2007 slipped away forever, President Bush signed the historic Energy Independence and Security Act.

The bill is an attempt to reduce the country’s dependence on foreign oil and help fight climate change. Whether or not the legislation will be able to achieve these results is up for debate. However, now is not the time for serious investors to become too involved in the politics of the bill. It’s far more important to keep an eye on your wallet.

There is money to be made off the government mandates in this bill. It requires more production of ethanol and biofuels, and also continues tax breaks for oil companies. Most notably, the act mandates the first required miles-per-gallon increase in more than 30 years. More on this historic change in a little bit…

The energy act also includes provisions to help improve energy efficiency in household appliances, as well as huge required biofuel increases. Oil companies will be forced to use at least 36 billion gallons of biofuel by 2022. That’s five times current production. The White House and Congress estimate the bill’s mandates could reduce CO2 emissions by billions of tons. And of course, we know its provisions will also benefit a handful of companies that are making the right moves in the energy markets.

Politicians needed to give big tax breaks to oil companies in order for the president to sign the bill. As a result, many alternative energy companies will not be offered the incentives they’ll need to get ahead quickly.

Because of this — and the considerable run-up in solar stocks that’s been going on for some time — we do not think it’s a good time to buy into the pure-play solar firms.

However, this does not mean that alternative energy is dead in the water. The country is in a sticky spot right now. We are mandated to cut CO2 emissions, but the big bucks aren’t being offered to the companies with the potential to get it done. That’s why it’s so important to look for alternative energy firms that have proven they can nab contracts and make money with technology no one else possesses.

The time is right to pick a unique alternative energy company with the ability to become a cash-making machine. We think we’ve found just that. And amazingly enough, almost all of the energy bill speculators have left this one out to dry.

The New Source for Clean, Efficient Power

The first incarnation of the energy bill — the Energy Policy Act of 2005 — includes an investment tax credit of 30% or $1,000 per kilowatt of total project costs. Individual states are on board with their own legislation, as well. California, for example, offers $80 million every year for renewable and “ultra-clean distributed generation technologies.”

The company we just found makes clean fuel cell power plants. These power sources can generate electricity with up to twice the efficiency of a conventional coal-fired power facility, all without producing the toxic air pollution the new energy bill seeks to reduce.

The company makes what are called direct fuel cells (DFC). DFCs are 47% efficient when generating power, whereas coal-fired plants obtain power generation efficiency of only about 35%.

The company’s fuel cells burn natural gas and other biofuels, reforming the gases into the hydrogen needed for power. More importantly, the fuel cells can run off of the specific kind of methane produced in wastewater treatment facilities. And, all across the country, there will be plenty of free gas at wastewater plants for it to use…

This is certainly something to keep on eye out for…

Best,

Greg Guenthner
January 24, 2008

P.S.: I truly believe this company will get some big contracts soon. Once that happens, watch out… In fact, I am so confident in this company, I’m recommending it to my Penny Stock Fortunes readers, which is why I couldn’t divulge the name here.

Along with this pick, there is another alternative energy play that I’m telling them about, as well as a niche company in the semiconductor industry that stands to make a lot of money soon. And that is just the February issue.

Greg Guenthner

Greg Guenthner uses his experience as a former journalist to dig up the hard-to-find headlines that could lead to big gains for your micro-cap portfolio. Greg offers his readers the scoop on topics ranging from alternative energies to biotechnology, digging up the best penny stock opportunities before they’re discovered by the mainstream media. On top of contributing to Penny Sleuth, Greg also heads Penny Stock Fortunes and Bulletin Board Elite. Special Report: Imagine Getting Rich as Ignored Stocks Soar - You could turn $200 into $1.2 million!

More on this topic (What's this?)

A Money Morning Interview: The Future of Energy (Money Morning, 10/22/09)

Roubini: Oil To Drop $50, Gold Has Nowhere To Go, Huge Bubble Being Created Will Crash In An Ugl... (Shocked Investor, 10/23/09)

4 Energy Stories for Monday (Red Hot Energy and Gold - Global..., 10/19/09)

Read more on Energy, Oil at Wikinvest

View articles by Greg Guenthner