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Wind Power Stocks

Written By Nick Hodge

Posted February 11, 2009

Amid the carnage on Wall Street and the almost complete freezing of credit, one encouraging story has slipped through the cracks.

With little fanfare, the U.S. passed Germany last year to become the world leader in installed wind energy capacity. Perhaps more impressive, China’s wind energy capacity doubled for the fourth year in a row.

Don’t get me wrong, the wind industry has also felt the effects of a global economic slowdown, with canceled orders, shuttered plants, and slightly falling prices.

Nonetheless, worldwide wind energy capacity grew by 28.8% last year to over 120,800 megawatts. That’s enough to power over 82 million homes by modest estimates.

And region-specific growth numbers are even more impressive.

So let’s take a look at the wind industry around the globe.

Global Wind Markets: 2008 Overview

For starters, the U.S. installed 8,358 megawatts last year, bringing the total U.S. wind energy capacity to 25,170 MW. That was enough to take the top spot from the German market, which has 23,902 MW installed.

China added about 6,300 megawatts of new wind capacity—the fourth year of triple-digit growth in a row—for a total of 12,200 MW.

On more of a macro level, Europe and North America each installed about 8,900 MW of new wind capacity. Asia was close behind with 8,600 MW, of which China accounted for 73%.

Here are a few charts that illustrate the size and growth of the industry:

top 10 wind capacity by countrytop 10 new wind energy capacity

But perhaps the most impressive and hopeful statistic to emerge from last year’s wind market data was this one, released by the Global Wind Energy Council (GWEC):

The massive growth in the US wind market in 2008 increased the nation’s total wind power generating capacity by 50%. The new wind projects completed in 2008 account for about 42% of the entire new power-producing capacity added in the US last year, and created 35,000 new jobs, for a total of 85,000 employed in the sector in the US.

Megawatts and new jobs, however, don’t earn us dollars as investors. For that, we have to get into the monetary value of the wind industry.

Wind Energy: Investment Potential

According to the GWEC, "the global wind market for turbine installations in 2008 was worth $47.5 billion." That works out to about $1.76 million per megawatt installed.

So let’s extrapolate some data to see the investment potential in the wind industry over the next few years.

By 2014, global installed capacity is expected to grow to 246,193 MW for 104% growth in the next five years. Put another way, there will be an additional 125,000 MW installed in the next five years.

Take a look:

installed wind power capacity by year

At an average cost of $1.76 million per megawatt, you’re looking at a $219.9 billion market—in just the next five years.

That’s a full 363% bigger than the wind market last year. And most of that money is making it’s way to the major publicly-traded companies like those seen here (just for U.S. market):

wind turbine annual installed capacity by company

The profit potential here is monstrous, but victory won’t be claimed with a simple throw-it-at-the-wall strategy. You have to know which companies are getting the major contracts, when, and for how much.

I’ve done all the research, and I’ve uncovered three wind investment vehicles that you can use to capture all the coming growth of the industry. And I’ve outlined them all in this free report.

Take a few minutes to read it. The timing couldn’t be better to capitalize on future wind growth; stock valuations are down due to the global economic situation, offering an exceptional buy-in point for a surging industry.

As the market begins to recover, you can bet the wind industry will be leading the pack. Getting in now could give you a head start on recouping any losses from last year.

Call it like you see it,

nick hodge




*Color charts from GlobalData