The Energy Tech Chronicles: Will Bust Turn to Boom?

Deck: 

Overcoming many obstacles, energy technology continues to have potential.

Fortnightly Magazine - February 15 2002
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In January 2000, Microsoft's Money Central website named Plug Power, a fuel cell company with virtually no revenues, as one of 10 stocks projected to rise 10,000 percent in the new millennium. This prediction quickly spread across the Internet and financial markets, sending energy technology stocks skyrocketing. Plug shares ultimately rose from their October 1999 IPO price of $15 to $156.50 (resulting in a market value of $6.6 billion). In June 2000, after a very large and over-subscribed round of private financing, Capstone Turbine, a microturbine company with no meaningful revenues, went public at $16 per share and traded as high as $98.50 per share (for a market capitalization of $7.2 billion). 

Today, Plug trades at $8.53 per share, Capstone trades at $4.80, Proton Energy has traded as low as $4.29 (Proton has $5.25 per share of cash!), and Red Herring just gave itself a "C-" grade for its prior prediction. Initial exuberance over energy technology has been replaced with tough questions about over-hype and unfulfilled promises. 

While the disappointment of public and private market investors is justified by the inability, thus far, of energy technology companies to achieve stated milestones, the promise of energy technology is real and these companies should not be ignored: the innovative products and services being developed and commercialized will dramatically change the future of U.S. energy markets.

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