Green tech ready to step in when oil prices rise: Don Pittis

As hard-hit investors in the energy sector hang on the latest price for crude and await news of this week'soil company results, they aren't the only ones. People in the green energy business also want to see an oil and gas price recovery.

"Obviously, higher cost of fossil energy is beneficial to renewable energy becausewe typically replace fossil energy," says Klaus Dohring, president of Green Sun Rising, based in Windsor, Ont.

Dohring'ssolar energycompany has not only survivedbut prospered despite the plunge in the price of fossil fuels.

According to a U.S. report out later this week, Green Sun isan example of a trend. And green advocates expectbusinesswill only improve asprices rise and governments get more serious about their their climate change commitments.

• Stock marketsoff to a rocky start partly due to lower oil prices
• Environment ministers face rising carbon emissions numbers

The report, expectedonThursday, will show that not only havegreen alternatives to fossil fuels survived the plunge in fuel prices, they've hit new records, saysEthan Zindler,one of a worldwide group of analysts whomonitor investment in alternative and renewable energy.

Solar power record

"There was a record amount ofgas burned for power generation last year," saidZindler, a contributor to the forthcoming report."But there was also a record amount of photovoltaics and the second highest amount of renewables that we have seen added in a year."

Thursday'sreport from BloombergNew Energy Finance, part of the highly credible Bloomberg financial research company, will be called the Sustainable Energy in America Fact Book.

The research shows that both gas and renewable energyare expanding at the expense of coal, says Zindler.The falling price of technologyplus greater efficiency meanthat solar panelsandwind often remain cheaper than gas.

One area where that is especially true is solar panels on the roofs of houses and small businesses.

Cheapest alternative

"Those projects are very rapidly expanding the territory where they compete and win," says Zindler.

To be profitable, the rates of return onlyhave to be lower than the retail price paid by the home or business owner.But even at commercialprices, wind remainsthe cheapestalternative in many parts of the continental United States including West Texas, Oklahoma, and Iowa.

"The winds are so strong and they have developed the equipment so that they can basically collect a great deal more of the wind to generate power," says Zindler.

He says that for the most part oil and renewable energy are not in direct competition, but Dohring says that's not strictly true.

He and his company have built a number of solar recharging stations for electric cars, but Green Sun Rising earns its bread and butter building solarplants in isolated Canadian communities, many in the far North,thathave generated all their power with diesel generators.

People are often surprised Dohringcan make a living selling solar power plants, like his latest on Banks Island in the Canadian Arctic, which has 10weeks a yearof constant darkness.

When the sun never sets

"However, if the sun never sets in summer, I have a nearly infiniteamount of energy supply," says Dohring.

While diesel fuel is cheap down South, by the time it is sentnorth and turned into electricity it has lost its edge on cost.Green Sun Rising's crucial advantage is thatDohringis competing with some of the most expensive energyon the globe, estimated atas much as $6 to $8 a kilowatt hour. That compares to about six cents per kWh in Alberta.

Dohring has foundaniche market, but he is convinced that solar and other alternative energy technologies, including electric cars, arebecomingmainstream. Tesla's battery vehicles have continued to sell well throughout the oil glut.

And while cheap gas may give manyconsumers a reason not to choose electric, that'sgoing to change.

Stephen Munro, an expert at BloombergNew Energy Finance on low-carbon energy policy,agrees there are changes afoot, but he says new laws such as thosein London and manyChinese cities capping the number of internal combustion enginesnothighergas prices, willforcethe transformation.

"Alternative-fuel vehicles, just simply because of their market share, are really not in a position right now to be dictating price in the market," Munro says.

More influential, he says, will beinvestor concerns about the long-term risk to fossil fuel assets.

"These are regulatory risks and policy risks that are going to be applied to fossil fuels and are not going to be applied to alternative energy,"saysMunro.

"Investors are taking note of that.It's making them look at alternative energy on a lot more of a favourable basis than they did just a couple or three years ago."

Follow Don on Twitter@don_pittis

More analysisby Don Pittis