EMERGING ISSUES

SOCIAL TOPICS: History of Walden Asset Management/SRI

Cutting Edge Companies: AstroPower

Published, Spring 2001

This new column highlights companies in the business of providing solutions to social and environmental problems. Featured companies are typically held in the SmallCap Innovations portfolios offered to Walden’s clients.

Consider these two facts: (1) about 100 million Americans live in counties that have unhealthful levels of air pollution. Most of this pollution is emitted by fossil fuel-burning electric power plants. (2) California power costs have… well, you’ve heard enough about that. It should be no surprise that the alternative energy industry has experienced renewed interest. The solar electric power segment has experienced 20 to 25 percent annual growth in recent years.

One such solar power company is AstroPower—the largest US-owned photovoltaic (PV) manufacturer. Delaware based AstroPower makes PV solar cells, modules, and panels for generating solar electric power. AstroPower’s (unaudited) sales and profits rose about 50 percent in year 2000, continuing its strong growth of the late 1990s. AstroPower uses a proprietary, continuous sheet manufacturing process to make silicon wafers. This generates less waste than the standard process, which requires slicing ingots into wafers and polishing the wafers. AstroPower also has technology to recycle discarded wafers from the semiconductor industry. To meet increased demand, AstroPower expanded its annual production of solar cells to 35 megawatts in 2000. One megawatt of generating capacity produces enough electricity for about 1,000 homes. In early 2001, AstroPower signed an agreement with a San Diego developer to install its solar systems in 100 new homes.

Despite its growth, solar power currently represents just a fraction of one percent of the electric generating capacity and production of U.S. electric utilities. As states reregulate the electric utility industry, there may be an increase in the relatively small amount of “green” power consumed in the United States. For example, the state of Arizona requires utilities to produce 0.1 percent of their electricity from solar sources in 2001, with higher hurdles each year thereafter. Solar power is used mostly off the electric utility grid in applications such as repeater stations for wireless communications. In addition, solar power offers an electricity alternative for developing countries without an extensive electricity infrastructure. Walden believes AstroPower will lead this solar surge.

The information provided in the above article is for historical purposes only. Such information may no longer be current and therefore should not be relied upon.

The information contained herein has been prepared from sources and data we believe to be reliable, but we make no guarantee as to its adequacy, accuracy or completeness. We cannot and do not guarantee the suitability or profitability of any particular investment. No information herein is intended as an offer or solicitation of an offer to sell or buy, or as a sponsorship of any company, security, or fund. Opinions expressed herein are subject to change without notice.