Smallcap Stocks on Solar Technologys Cutting Edge

By James Brumley

Solar power is well past the prove it stage. The next step in its evolution is bringing its cost down to where its comparable to gas and coal energy prices. To do that, the technology and equipment has to improve in addition to becoming for functional in a real-world environment. Thats good news for smallcap investors, as many of the companies making those advancements are publicly-traded.

Here are some of solar powers most compelling current developments, and a few companies " some of them smallcaps - that could make their investors glad to be owners.

Solar Panels You Just Paint On

Do you hink a solar panel is a large, flat piece of equipment that you have to securely mount? Thats what they are now, but a new development may change the definition of solar panel in the future. In tests, the photovoltaic materials used in a traditional solar cell have also successfully been painted onto a solid structure, and then successfully converted solar power into electricity. Mounting a panel may not be necessary if the paint can be made to work well enough.

Though no publicly-traded stock can be purchased as a way of investing in this paint, dont assume thats a permanent problem. When corporations see that the technology is viable, theyll likely adopt and begin marketing it.

Thin Film Solar Cells

If for some reason painted-on solar panels wont work well enough, and theres not enough flat, sturdy surface area to mount traditional (i.e. heavy) photovoltaic cells, the solution is a flexible thin film solar panel. Theyre flat and thin and not rigid. String-ribbon cells also fall into this category.

First Solar Inc. (NASDAQ: FSLR) is one of the companies leading the thin-film effort. The companys cadmium telluride panels cost less than $1.00 per watt to make, which is approaching comparability with photovoltaic cells.

That said, once again its a smaller company that may be taking a particular technology to the next level. Smallcap stock XsunX, Inc. (OTCBB: XSNX) may be of interest to investors, as their ASI-120 (amorphous silicon) solar module is expected further reduce the per-watt cost of thin-film panels. And, they may work well in more environments.

Another entry into the thin-film arena is Uni-Solar Ovonics triple junction thin film solar cell, which is quickly proving to be very cost effective. The company is wholly-owned by smallcap company Energy Conversion Devices (NASDAQ: ENER), for interested investors.

Better Solar Power Storage

You dont need to be solar power physicist to figure out the sun doesnt shine 24 hours per day. After sunset, the industry needs to figure out a way to keep the electricity flowing. The obvious solution is storing the power created during the day for use at times when there is no sunlight. How? A battery.

The challenge in storing utility-levels of electricity is simply that current batteries cant do the job well enough. Most modern batteries are still made of solid components which degrade over time, take a long time to charge, and they dont last all that long. The solution may be a newly-developed, liquid-based battery.

The good news is, its the finest minds at MIT working on the liquid battery. The bad news is, you cant invest in MIT. Thats ok though. Once MIT proves their liquid battery is better, for-profit companies will become interested.

In the meantime, solid battery-maker Valence Technology Inc. (NASDAQ:VLNC) has a product for every imaginable need automotive, industrial, and yes, even storage solutions for power generated by wind and solar sources. Smallcap stocks like EnerSys (NYSE: ENS) and Advanced Battery Technologies Inc. (NASDAQ: ABAT) may be good bets within the utility battery group as well.

That said, there are at least a couple of dozen battery companies that could actually meet the needs created by the continued growth of solar power. Some are better than others, but thats not a function of size.

Bio-Based Backsheets Cheaper Than Petroleum

Even though one of the key goals of solar power is to rid ourselves of dependence on petroleum, theres a bitter irony in the fact that traditional photovoltaic panels actually require petroleum to be manufactured. How? Not in the power cells themselves, but solar panels use petroleum in their protective covering called a backsheet.

The obvious problem is that the use of petroleum in the manufacturing process makes solar panel prices subject to fluctuation with the price of oil. Theres a small company called BioSolar Inc. (OTCBB: BSRC), however, that has a working solution.. dont use petroleum in the backsheets. BioSolars backsheets use a plant material in place of petroleum, thus making it a bio-based backsheet.

BioSolar had been primarily focused on backsheet technology for the most common crystalline silicon (C-Si) photovoltaic solar cells the markets biggest seller as of right now. However, copper-indium-gallium-selenide (CIGS) and cadmium telluride (CdTe) thin-film panels are quickly becoming competitors of C-Si panels because of their similarly-low costs and impressive power production. So, BioSolar has recently begun work on bio-backsheets for CIGS and CdTe thin panels as well.

Just a Window? What a Waste.

A lack of transparency clearly limits where and how photovoltaic panels can be used, since a window blocked by a solar panel isnt a window at all. However, not utilizing the surface area of windows " particularly for large, glass-covered buildings " is a waste of potential energy. The solution is a see-through solar panel.

Turning glass into an effective solar panel without sacrificing transparency isnt science fiction for New Energy Technologies, Inc. (OTCBB: NENE). This small company has devised a way to coat windows with silicon nanoparticles that actually convert ultraviolet light into electricity. Needless to say, if an entire building could become a self-contained electricity supply, the implications would be enormous.

Next Step For Investors

As enticing as some of these afore-mentioned companies may be, bear in mind its ultimately the technology that will determine their profitability. While these stocks are presently the most interesting, be vigilant about finding the companies that will actually reach the proverbial finish line first. At the same time, remember the best technology is one thing, but profits may be another.

We feel smallcap stocks in particular can quickly surface " often without warning - as worthy investments since their respective companies are nimble. Either way though, the industrys projected growth is undeniable, so one company or another is going to benefit from the dollars being poured into the efforts described above.

The paradigm shifts in solar powers technology are no small matter, but for serious investors who need details of their commercialization potential, keeping tabs can be tough. Thats why we strongly recommend subscribing to our free newsletter. Well inform you of the industrys advances, and the stocks that can let you tap into that progress. - 23167

About the Author:

James Brumley has spent the last two years researching alternative energy stocks and has successfully identified sectors and specific stocks in the alternative energy space that may hold tremendous promise. If you have an interest in learning more about alternative energy stocks, the Small Cap Network's free newsletter published by James Brumley is an excellent resource.