ASX stocks with exposure to solar energy

ASX stocks with exposure to solar energy

As Greta Thunberg's climate-conscious speech reverberates throughout the globe, it is high time we acknowledge the growing momentum of environmental sensitivity among the people. The extreme weather conditions in Australia characterised by unprecedented droughts and floods, leading to apocalyptic Bushfire signals high alert all around the country. While the political leaders of the world still seemed to be struggling at curbing the environmental degradation, the chances are you as a consumer might be inclined towards the products bannering eco-labels. 

Australian Government in the face of climatic change has taken up several measures that are directed at promoting renewable energy market. The government in its LRET program has set the goal of 33,000 GWh of electricity till 2020 through the alternate energy sources. It would mean around 23.5% of the total power energy generations in Australia would be from alternate energy sources.

Renewable energy players providing alternate solutions to the carbon-emitting conventional energy sources enjoy heightening popularity amidst the growing number of believers in climate change.  

As highlighted in the ACCC electricity market report, the average annual power bill in 2018-19 dropped by $65 or 4 per cent. The surging environmental cost leading to the shift towards solar energy can be attributed as the prominent cause for the decline in the electricity bill. The increase in the customers with the solar panels from 0.2 per cent in 2007-08 to 16 per cent in 2018-19 represents shifting Australian market orientation towards solar energy.

The amount of radiation in Australia (58 million PJ) per year exceed ten thousand times its current requirement. In the face of such potential solar power harnessing opportunity and the growing climatic concerns, let us look at the few ASX stocks that have exposure to solar energy.

Carnegie Clean Energy Limited (ASX: CCE)

Carnegie Clean leverages the untapped market of renewable energy through the aid of the latest technologies. The company is built around to harness the wave, solar, battery storage and desalination via microgrids. Carnegie Clean continues to master the utilisation of the wave energy through its 100% owned CETO technology which has assisted the company in carrying out the world-leading alternate energy projects. 

The company, through its wholly owned subsidiary Energy Made Clean (EMC), caters to the client's demands concerning the solar, battery and hybrid energy systems.

Carnegie, in its last quarterly report, highlighted that its 100% owned Garden Island Microgrid delivered over 1000 MWh of clean energy to Department of Defence.

As reflected in its 2018 Annual report, the 10 MW Northam Solar Farm generating ~24,000 MWh of energy creates a significant revenue stream for the company.

Carnegie Clean, with the market capitalisation of $22.28 million, has the EPS of -$0.018. It recorded the closing price of $0.001 at the session ending on 14 February 2020, down 50%. 

Genex Power Limited (ASX: GNX)

The ASX listed power generation company, Genex Power is centred towards the generation of clean electricity and developing electricity storage solutions. Carnegie, within its portfolio sports 770 MW of renewable energy generation and storage projects.

The Kidson Clean Energy Hub located in far-north Queensland is one of the world's innovative example of the integration of the large-scale solar with pumped storage hydro. The Kidston Hub encapsulates various solar along with the hydro projects that align with its existing objective of solar energy generation and storage. 

270MW Kidston Solar Project built using more than around 3 million solar panels forms one of the crucial projects within Genex Power portfolio. The project with the generation capacity of 783,000 MWh/year and located in the highest radiation zone of Australia has the capability to power 143,000 homes.

In the quarterly update, the company highlighted that KS1 generated the net revenue of $2.048 and the power of 24,109 MWh for Q2FY20. The company recorded the loss in the power generation from the September quarter due to Power Outage in October that was caused by a Software issue. 

One of the other projects, 50 MW Jemalong Solar Project (JSP) that is situated near Forbes has further augmented the position of Genex Power in the solar power generation market. With the generation capacity of 128,700 MWh/yr, the project provides extensive opportunity to bolster the energy department by powering around 23,000 homes. 

Notably, the GNX stock price on ASX in the last six months has decreased by 21.57%. GNX stock last traded at $0.195, down by 2.5% on 14 February 2020. The company has the market capitalisation of $80.37 million. 

MPower Group Limited (ASX: MPR)

The Sydney based investment company Tag Pacific Limited changed its name to MPower Group Limited on 31 January 2019 as its direction aligned towards the technological orientation.

Mpower specialises in the delivery of the on-grid and off-grid power solutions along with the other innovative products to its customer base. MPR mainly works in the areas concentrating on renewable energy storage and development, battery storage, and hybrid off-grid and micro-grid systems. The group also designs and delivers the grid-connected renewable systems along with the high-reliability power systems to its niche clients. 

MPR has managed to display its technical prowess through the aid of the different projects that involve complexity and innovativeness in their handling. The involvement of the group in solar projects has exposed it to the extensive opportunity in the untapped solar market. MPR commenced work at the two new solar farm projects developed by Astronergy Solar Australia Pty Ltd. The two projects at Mannum and Port Pirie in South Australia with the generation capacity of 5MW each aligns with the new tech-oriented direction of the company.  

MPR with the market capitalisation of $4.77 million has seen the stock price rise by 15.38% in the past six months. MPR shares were trading at $0.025, down by 16.67% intraday by the close of trading session on 14 February 2020.

New Energy Solar (ASX: NEW)

Operating as a subsidiary of the Sydney based Walsh and Company Asset Management, New Energy Solar’s operations are centred around acquisition and management of large-scale solar generation facilities. The company works on the prominent objective of selling clean energy to the creditworthy energy purchasers through long term contracts. 

NEW has operational presence in Australia and the US. Out of its 16 globally operating solar plants, Manildra Solar Plants and Beryl Solar Plants are in Australia. Manildra Project with the power generation capacity of 55.9 MW sells power to Energy Australia; the 110.9 MW Beryl Project sells electricity to Sydney Metro. 

The company in its Quarterly update for the period ending 31 December 2019 highlighted the distribution of 7.9 cents per stapled security accounting for the annual yield of 5.8%. 

The share price of NEW which has the market capitalization of $409.98 million dropped by 10.38% in the past six months. By the close of trading session on 14 February 2020, NEW shares were trading at $1.15, down by 1.29% intraday.

ReNu Energy Limited (ASX: RNE)

ReNu Energy Limited delivers clean energy solutions through independent power generation. The company encompasses the portfolio of projects that utilises solar PV technologies for renewable energy production. The four key business areas where the company operates include Solar PV embedded Networks, Solar PV Grid-connected, Solar PV power and biogas power purchase agreements. 

The annual report for the period ending 30 June 2019 highlighted the divestment of the group's Embedded network operations inclusive of the energy retail authorisation and Amaroo Solar PV facility to CleanPeak Energy for $5,775,00. It reported an increase of 4.0 GWh in the supply and sale of energy from the previous reporting period. The net loss after income tax decreased from ~$5.22 million to $3.49 million. The company recorded an increase in the total income by $888,000 in 2019 compared to the previous period. 

RNE shares last traded on 14 February 2020 at the price of $0.025. It has the market capitalisation of $3.02 million and the share price decreased by 28.57% in the last six-month period. 

Outlook towards solar energy stocks

The market movement strengthened by the mobilisation of the political groups towards the environmental control in Australia has surged the wave for green chip stocks. Solar Energy often considered the captain of the alternate energy stocks in the present time is looked upon by investors to revolutionise the megatrend of green stocks.


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