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All You Need to Know About Wind Energy

How much do you know about investing in wind energy? Get up to speed with TheStreet.com.

By TSC Staff July 22, 2008

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According to the U.S. Department of Energy, up to 20% of the country's energy supply could be generated by wind power by 2030.

In May, T. Boone Pickens' Mesa Power ordered 667 wind turbines from GE (GE) as part of its plans for a giant wind farm in Texas.

That same month, Jim Cramer wrote on TheStreet.com: "Sanford Bernstein put out a fabulous report today May 15 about alternative energy that waxed wonderfully about wind and a little less wonderfully about solar. The latter isn't as loved, because the average selling price of solar is too high vs. the dirty competition."

On July 17, The Dallas Morning News reported that the Texas Public Utility Commission authorized $4.93 billion of new wind power transmission lines, solidifying the state's position as the country's largest generator of wind power.

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Today, at a hearing of the U.S. Senate Homeland Security and Governmental Affairs Committee, Pickens testified that the county needs to reduce its demand for foreign oil and ramp-up its own clean and renewable energy infrastructure, particularly wind.

So how much do you really know about wind energy?

The following are key insights from TheStreet.com on the potential opportunities and risks in wind energy investing.

Cramer: Give Your Portfolio Wind Power (Video, Jul. 17):

Jim Cramer reviews his "wind-ex" stocks.

To watch the video, click the player below:

From Cramer's 'Mad Money' Recap: Inherit the Wind Stock:

To help illustrate the many great companies involved in the wind power business, Cramer built a windmill from scratch, piece by piece, to show which companies make each component.

First, Cramer featured the wind tower business that makes the support structures for windmills. Here, he reiterated... Otter Tail (OTTR) as one of the best stocks to own.

Finally, Cramer said... MasTec (MTZ)is one of the best companies for the wind power infrastructure needed to bring power from the mill to the grid.

Read the full article.

New Wind-Energy ETF Blows Into Town (Video, Jun. 29)

High oil prices have investors turning to wind-energy stocks. Robert Carey, chief investment officer at First Trust, says the new exchange-traded fund -- ticker FAN (FAN) -- is the safest way to play the emerging sector.

To watch the video, click the player below:

From Cramer's 'Mad Money' Recap: Wade In with Kaydon:

Cramer explained that while Kaydon (KDN) is best known for its industrial bearing business that mainly serves heavy industry as well as the aerospace and defense markets, the company is also the market leader in low-friction wind turbine bearings.

Wind power currently only accounts for 8% of Kaydon's sales, but is 50% of the company's current backlog. According to Cramer, wind power should account for 20% of the company's sales by 2009 and is expected to triple by 2010.

Read the full article.

From Cramer's 'Mad Money Recap': Stocks That Can Take a Hit:

Cramer called Thomas & Betts another "stealth" wind power stock that investors need to consider.

"Everything that wind touches is getting bigger," said Cramer who noted the management of Thomas & Betts is doing little to promote this small, but growing, portion of their business. Cramer said the company has also been selling unprofitable product lines and concentrating their efforts on its core competencies.

While Thomas & Betts reported lackluster earnings on April 30, Cramer noted the company said most of its sales will be during the latter half of the year. He also said the company's international exposure, which now stands at 40% of sales, is up from just 30% a year ago.

Read the full article.

Cramer: Wind Stocks Are Towers of Power (Video, May 7)

A lack of supply for towers has the wind sector on fire, says Cramer. A pure (but speculative) play: Broadwind Energy (BWEN). Cramer thinks "this can be a gigantic, gigantic company."

To watch the video, click the player below:

Plus, don't miss Cramer: Broadwind's the Weather Vane of Wind Sector and Cramer: Buy Nat Gas Now, Wind in '09 on TheStreet.com TV.

From Cramer's 'Mad Money Recap': Woodward Governor's Big Wind Power Play:

Cramer called Woodward Governor a forward thinker that now estimates its wind power business to be worth $100 million by the end of fiscal 2008, compared to the consensus estimates of only $60 million.

To bolster its wind power business, Woodward recently added its first Chinese turbine manufacturer and is building a new factory in Colorado. He said the company's wind power business is growing at a staggering 150% a year, far more than any "high-tech" company can deliver.

Read the full article.

From Cramer's 'Mad Money Recap': Emerson's New Tech Look:

Cramer proclaimed that 2009 will be the year of wind power and recommended Owens Corning (OC) as his favorite wind power stock.

Cramer said that Owens Corning, often thought of as just a supplier of insulation, is transforming itself into a great global manufacturer of alternative energy components. The company now has a glass-fiber composites business that accounts for 33% of its sales.

Cramer said the glass composites business combines glass fibers with other materials to make incredibly strong and flexible substances for wind turbines, among other applications.

Read the full article.

From Jim Cramer's 'Stop Trading!': Win With Wind:

Cramer said that the U.S. is facing a shortage of supply of windmills. "Everybody who's involved in making them, it's a win still," Cramer said. He recommended Quanta Services (PWR) and Trinity Industries (TRN) as plays on his thesis.

Read the full article. Plus, don't miss Cramer: Trinity Is the Wind Play on TheStreet.com TV.

From Cramer's 'Mad Money Recap': America's New Tech Stars:

Cramer welcomed Dan Batrack, chairman and CEO of alternative energy supplier Tetra Tech (TTEK), to the show to discuss what he called the company's "breakout quarter."

Batrack said that his company had a very strong quarter, with net income up 30%, revenue up 35% and the company's backlog up 40%. He credited the company's growth to strong demand for wind power.

Batrack believes the U.S. wind power market is growing faster than the consensus forecast of 25% growth. He said his company has booked over $170 million worth of orders for wind products in the past 90 days.

Read the full article.

To stay up to date on wind and other industries within the energy sector, visit TheStreet.com'sEnergy/Commodities section.