Tesla a Bright Spot in Still Dim, but Improving Electric Car Industry

Photo of Nissan Leaf S courtesy of evworld.com

Photo of Nissan Leaf S courtesy of evworld.com

Anyone watching the still slow but improving progress of the electric car industry may have seen the Bloomberg Businessweek story on the “Tale of Two Electric Car Makers: Tesla Soars, Fisker Flops” (http://www.businessweek.com/articles/2013-05-08/a-tale-of-two-electric-car-makers-tesla-soars-fisker-flops). Tesla Motors not only produced a profit in the first quarter, as advertized, but also increased its guidance on sales for the year, from 20,000 to 21,000 cars. TSLA revenues were up 83 percent year-over-year to $562 million and the stock is soaring (see below).

While the article outlines supply chain and battery issues and other “kinks in its processes” Tesla needs to iron out, their stock is soaring and the outlook looks good. The contrast was provided by Anaheim, CA-based Fisker Automotive, which is laying off employees and hiring bankruptcy consultants, the article reports. Another electric car maker, Los Angeles-based CODA Automotive, recently filed for bankruptcy protection and announced it was “focusing its business strategy on the growing energy storage market,” according to a company filing.

For more positive electric car news, the BBC posted an article this week on the Nissan Leaf (http://www.bbc.com/autos/story/20130509-leaf-charges-into-mid-life) as it “charges through mid-life.” The Leaf, billed as “the first truly global mass-produced electric vehicle,” now includes the Leaf S, a lower cost model “designed to lower the barrier of entry to EV ownership.” One of the cost cutting moves was to move its assembly line from Japan to another Nissan factory in Smyrna, TE.

The BBC put the Leaf through its paces and managed to get 75 miles from a full charge, right about in line with Nissan estimates. Competitors mentioned in the article include the Toyota Prius PH-V and Ford C-Max Energi, both plug-in hybrids.

If anyone out there is charged up about the electric vehicle market, and knows of a small cap stock play in this market, please let us know. Meanwhile, we’ve been following a few small caps, plus Tesla to see how their stock is moving. We’ve also added a new company, Car Charging Group, to our list.

Palo Alto, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster, the Model S and other electric vehicles and electric powertrain  components. It’s way too large for our small cap blog focus, but just as a reference, the last time we looked at Tesla last February 20 it was trading at $38.90 with a market cap of $4.4 billion. As we mentioned, TSLA stock has been on a huge roll. It closed May 15 at $84.84, up $1.60 for the day. Its 52-week trading range is now $25.52-$97.12.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com/) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. When we last checked on Feb. 20 its stock closed at $0.08 with a market cap of $24. ZAAP closed May 15 at $0.14, up 3 cents for the day, with a market cap of $42 million. Its 52-week trading range is $0.06-$0.27.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com/) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics.  MXWL closed back on Feb. 20 at $10.01 with a market cap of $292 million. It closed May 15 at $6.36, up 11 cents for the day, with a market cap of $185 million. Its 52-week trading range is now $4.90-$11.08.

Miami Beach-based Car Charging Group (OTCQB: CCGI, http://www.carcharging.com/) caught our eye with the announcement March 12 that it was acquiring EVPass, a company building destination charging networks for EV charging. CCGI  is also in the business of building charging station networks and has been busy making more acquisitions. Earlier this month, CCGI announced it had acquired 350Green LLC. CCGI closed May 15 at $1.34, up 4 cents for the day, with a market cap of $70.8 million. Its 52-week trading range is $0.60-$2.

U.S. Division of Chinese Automotive Components Maker Outbids Others for A123

Photo of Wanxiang America courtesy of siteselection.com

Photo of Wanxiang America courtesy of siteselection.com

As a follow-up to our recent posts about the auction of the assets of bankrupt battery maker A123 systems, it was announced this week that Wanxiang America Corp, the U.S. arm of China-based Wanxiang Group Corp. was the winning bidder at $256.6 million. The deal must still be approved by the U.S. Bankruptcy Court, which supervised the auction, and the Committee on Foreign Investment in the U.S., a group overseen by U.S. Treasury that regularly reviews any sale that results in a foreign country or person gaining control of a U.S. business.

The hearing in the bankruptcy court was scheduled for Dec. 11.

If approved, Wanxiang would receive A123’s automotive battery business, grid energy storage division and other commercial business assets including U.S. facilites in Michigan, Massachusetts and Missouri. The government business previously owned by A123 is being sold to Navitas Systems, a company spun off from Sun Microsystems, for $2.25 million.

Johnson Controls, one of the bidders that lost out in the auction, told the Wall Street Journal that it is still interested in A123 if the regulators do not approve the deal with Wanxiang. Johnson Controls bid “about $250 million” for A123, according to the WSJ.

Wanxiang Group Corp. is the largest automotive components maker in China. A123 Systems has been the sole battery supplier for Anaheim, CA-based Fisker Automotive. Fisker has halted production of its $100,000 hybrid Karma because of a shortage of A123 lithium ion batteries.

Q/A with Philip Lawes, Founder and President of Insoltech Solar

Philip Lawes, founder and president of Laguna Beach, CA-based Insoltech Solar, has been in the solar power business for 34 years. He is a designer and consultant for renewable power systems such as solar photovoltaic systems. Although based in Southern California, Lawes has installed renewable energy systems in various parts of the world including the Caribbean, Mexico and the South Pacific, as well as in the California desert areas.

Smallcapworld: How did you get into the solar business way back in the 1970s and what was your first solar job?

Solar farm photo courtesy KCOY.comChannel 12

Lawes: It was a solar hot water system. That’s all there was back then in the late 1970s that was financially viable. Solar power has been around for a long time. The photovoltaic cell was developed by Bell Labs and the first applications were for space and to power communications satellites. But it really kicked off during the second energy crisis in 1978. Saudi Arabia basically cut off all our oil and gas prices skyrocketed. Remember the long lines and high gas prices? There was an “energy crisis” and everyone started looking for alternative energy sources. President Carter helped boost the solar business by creating large financial incentives through generous tax breaks.

Q: Which companies were making the solar panels back then?

A: A lot of companies got into it, but they were mostly small companies, many based in Europe, making solar thermal collectors. It was mostly about heating water to reduce natural gas bills and in some cases electric bills, if you had electric heating.

Q: When did you get into photovoltaics?

That would be in the 1980s. I did a lot of work in Baja California, in and around Cabo San Lucas. I worked for expats in the area, for their small palapas and for pumping water on their ranches, for their cattle or other needs. The idea was to generate electricity in remote areas where utility power was not available and the cost to run diesel-powered generators was prohibitive.

Q: Tell us about some of your other projects.

A: I built a solar electric system for a small resort called Papageno in Fiji. Just a few years ago I also designed and built a solar electric system for Johnny Depp for his private island in the Bahamas. I was also a subcontractor for a 1.3 million watt system for the Twenty-Nine Palms Marine Corps base in the California desert. And I built a small solar energy water pumping system for the Irvine Company here in Southern California to provide water for an endangered species. We are working on a custom home in Shady Canyon now, an exclusive area of the Irvine Ranch.

Q: There are many different types of solar arrays now available. Which are best for the average homeowner?

A: The typicial, flat-plate, mono- or poly-crystalline solar modules are still the workhorses of the industry. They are scalable, maintenance free and offer excellent warantees and still the best route for average homeowners. Thin film modules are not as efficient so they require more area. And companies are still having problems getting the manufacturing process down. People got into thin film because they thought they could manufacture them cheaply but that hasn’t really happened yet. And no one anticipated that the standard modules would come down in price so much.

Q: Are there American companies that are able to compete with the Chinese in the manufacture of solar modules?

A: Oh sure. FirstSolar is a thin film manufactuer, the only really successful thin film manufacturer. SunPower is an American company and has a very efficient module built with great technology but they manufacture offshore, primarily in the Phillipines. Helios is based in Wisconsin and has been successful making solar modules. But there has been, and will continue to be, lots of attrition. Some companies are even selling their modules at a loss.

Q: Why do some companies like Helios succeed, while others like Evergreen Solar and Solyndra fail?

A: Solyndra stepped out of the box and tried a very different approach and ultimately had too many problems. Their idea was to build little glass cylinders with thin film cells inside. They were light weight and didn’t require ballasting, but I believe they had a lot of breakage and lots of other problems in production. Ultimately, they didn’t anticipate the dramatic decrease in price of today’s standard workhorse mono- and poly-crystalline modules. Evergreen had a different approach, called ribbon technology. My take is that they couldn’t approve on the efficiency of the modules enough, couldn’t get enough volume going and couldn’t compete with the big guys from China and Germany. Helios is successful so far, but who knows, we could read tomorrow that they are in trouble. But they do provide the old standard modules people want and a lot of people just want to buy American only, which helps them. I think SunPower makes the highest efficiency module of all.

Q: You say you helped do an installation at a Marine base. Why is the military getting into solar?

A: There have been mandates from the Department of Defense, one of the largest if not the largest user of electricity in the country, and they are looking for ways to do things cheaper.  In many cases these military installations are out in the middle of nowhere and it’s a cheaper alternative than using diesel generators. They also want to be autonomous, and have security. That’s why they are also looking at biofuels. They want to use stuff we grow ourselves instead of relying on outside sources. 

Q: How is solar power progressing in other countries, like the emerging parts of the world?

A: The emerging nations are finally beginning to grasp the value of renewable energy. Cuba has lots of solar, so do the Virgin Islands, and Hawaii as well because they have to import their fuel. Many parts of the world don’t have coal, natural gas or hyro power. It’s all about diesel-fired generators. It’s all about what they call grid parity. That’s the holy grail. If you can product power at a lesser cost than what they charge. Grid parity is now in places like the Bahamas, but it all depends on the particular area.

Q: How long does it take the average residential installation to pay for itself in terms of decreased or eliminating energy bills?

That really depends on your location. There are so many variables like which utility is in the area and what the rates are and what rebate programs they offer. In Southern California, with large homes and large usage like the tier 4 and tier 5 users, it’s about 5-7 years. But in places like Hawaii that doesn’t have coal-powered plants or hydro and electricity is very expensive, but there’s plenty of sun, the payback can be quicker.

Q: What are the chief maintenance problems with a home system? Do you need to have special insurance to cover the installation on the roof?

My main expertise here is California, which doesn’t have extra insurance, in fact they make it mandatory to not charge extra insurance. But as California goes, so goes the rest of the country, typically. The chief maintenance problem is keeping the modules clean. Again, that depends on where you live. Actually, it’s easier on the East Coast where they get more rain. In California, where it can go months without rain, it can be difficult to keep them clean, particularly if you live near a construction area that is generating lots of dust. It’s good to wash them every few months. Have a window washer do it if you can.

‘Try It, You’ll Like It’ Is Hope of Non-Profit Group Backing Plug-In Electric Vehicles

Much has been made about the relatively weak sales of electric and plug-in hybrid vehicles, particularly the Chevrolet Volt. The Volt received good reviews for its pep, its seamless operation and design when it first debuted in December 2010 (http://www.nytimes.com/2010/12/26/automobiles/autoreviews/26volt.html?pagewanted=all). But then it was priced at $41,000 (before a $7,500 federal tax credit) and initially sold in only six states (California, New York, New Jersey, Texas, Connecticut and Michigan) and Washington, DC. By last March, General Motors announced it would suspend production of the Volt for five weeks because inventory had built up faster than sales.

Many electric car/plug in hybrid advocates have suggested that the real reason car buyers are not choosing these

Chevy Volt photo courtesy about.com

vehicles is that they haven’t driven them. To that end, a nonprofit group called Plug In America has organized National Plug In Day on Sept. 23, a celebration taking place in 60 U.S. cities that allows people to drive these cars. Cars available for driving include the BMW ActiveE, Chevy Volt, Coda, Fisker Karma, Honda Fit EV, Mitsubishi iMiEV, Nissan Leaf, Plug In Prius, Tesla Roadster and Toyota Rav4 EV.

On Sept. 18, Pike Research issued a report tracking factors like age, race, gender and income, among other determinants, that indicate the likelihood of a North American consumer to buy a plug in electric vehicle (PEV). One of the most important indicators is geography and the report concluded that that state with the highest PEV sales for the remainder of this decade will be California. The report, titled “Electric Vehicle Geographic Forecasts,” notes that PEV sales “roughly correspond to population but other factors, including demographics, socioeconomics and public policy have a strong influence as well.” The report including an executive summary is available for free at the Pike Research website.

We last covered a random variety of small caps related to the PEV and hybrid automobile markets, including battery companies, last March.  Here’s a look at what has happened to these stocks in the meantime.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com/) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. Most of its business at this point is with government or military customers. Its stock has been on a gradual downturn since it sold for 90 cents in early 2011. It sold for 20 cents last March 13 with a market cap of $45.25 million. ZAAP closed Sept. 19 at $0.13. Its market cap is now $38.7 million.

Waltham, MA-based A123 Systems (Nasdaq: AONE, http://www.a123systems.com/) makes lithium ion batteries based on its proprietary Nanophosphate technology. It stock was a high flier back in the fall of 2009 when it traded for about $26 but those days are long gone. Last March 13 the stock closed at $1.69. AONE closed Sept. 19 at $0.32 cents. and market cap is now $54.4 million.

Austin, TX-based Valence Technology Inc. (Nasdaq: VLNC, http://www.valence.com/) manufacturers energy systems based on another phosphate-based lithium ion technology. Its products are used in a variety of applications in addition to all-electric vehicles, such as wheelchairs, robotics and remote power devices. VLNC stock has come way down in value from $5 in 2008. Last March it traded for 88 cents and its market cap was $150 million. VLNC closed Sept. 19 at $0.019 with a market cap of $3.2 million. It is currently facing a variety of class action shareholder lawsuits.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com/) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics, as well as microelectronic products including single board computers and high-density memory and power modules for satellites and spacecraft applications. Last March 13 MXWL stock was trading near the top of its 52-week range at $18.69 with a market cap of $522 million. The stock took a hit when management cut back on its revenue guidance in August. MXWL closed Sept. 19 at $8.54, down 31 cents for the day. Its market cap is now $249 million.

San Carlos, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster and other electric vehicles and electric powertrain  components. Its market cap of $3.3 billion puts it out of our smallcap focus but its stock hit a 52-week high of $36.29 March 12, which put the stock up more than 30 percent in the past five months. By Sept. 19 it had dropped down to $31.05.

Life Imitates Art in Chinese Investment in A123 Systems

Someone please contact popular novelist Gary Shteyngart. Recent headlines like “Latest Chinese Target: Batteries” in the August 9 Wall Street Journal make his recent novel “Super Sad True Love Story” seem incredibly prescient, some might even say scary.

Lithium-ion battery factory, photo courtesy of gm-volt-com

Shteyngart concocted a post-apocalyptic world in which the Chinese yuan has replaced the U.S. dollar in everyday commerce. Now, in real life, Wanxiang Group Corporation, one of China’s biggest parts makers, has swooped in and acquired Waltham, MA-based A123 Systems (AONE) , a small cap maker of advanced lithium ion batteries and battery storage systems and “a company that two years ago was one of the most promising U.S. innovators in the clean fuel auto industry,” according to the Journal.

The acquisition has triggered lots of hand-wringing and, because A123 received considerable federal funding, even partisan political posturing from Republicans accusing the Obama administration of failing to “secure sensitive taxpayer funded intellectual from being transferred to a foreign adversary,” according to CNN.com (http://money.cnn.com/2012/08/09/news/companies/a123/index.htm?source=yahoo_quote). Never mind that the Chinese acquisition may actually wind up saving the Michigan factories A123 had invested in with its US taxpayer dollars, according to CNN.

We’ll stay out of the politics, but it’s a good bet that Chinese investors, and other savvy investors all over the world, can see a good bargain when it’s there for the taking. Not that long ago, A123 was trading for about $20 a share, but had recently dropped to less than $1. Unfortunately for A123, lower oil prices and a slower-than-expected demand for electric vehicles helped stall its progress, according to CNN.

So what other smallcaps might now be in the sights of Chinese investors? Who’s next to go? There’s little question that numerous solar companies have been hurt badly by competition from the Chinese and a soft economy. Or that making such things as photovoltaic panels and cells are ideally suited for the sort of mass manufacturing China is good at. Remember televisions? Just as television manufacturing migrated away from the US to Asia, battery manufacturing has pretty much done the same thing.

Here are five companies chosen randomly that are either peers of A123 in the battery/energy storage business, have been beneficiaries of government largesse, or have encountered some sort of recent trouble that has hurt their market capitalization.

Newark, NY-based Ultralife Corp. (Nasdaq: ULBI, http://www.ultralifecorporation.com/) fits in the peer in trouble category. ULBI provides products and services ranging from portable and standby power solutions to communications and electronic systems. Products include batteries (rechargeable and non-rechargeable), standby power systems and custom engineered systems. ULBI was downgraded to sell by TheStreet Ratings on Aug. 6. However, Forbes.com noted that CEO Michael Popielec has purchased $405,000 in ULBI stock in the past six months. Its market cap is now $51 million and 52-week trading range is $2.71-$5.50. ULBI closed Aug. 15 at $2.87, down 9 cents on the day.

Carrollton, TX-based Universal Power Group (AMEX: UPG, http://www.upgi.com) is a supplier and distributor of batteries and related power accessories. UPG sells, distributes and markets batteries and related power accessories under various brands and its own brands. Its market cap is $11 million and 52-week trading range is $1.26-$3.49 but trades very lightly, only about 1,400 shares a day. UPG closed Aug. 15 at $2.15, no change on the day

Warrenville, IL-based Fuel Tech Inc. (Nasdaq: FTEK, http://www.ftek.com) is a greentech company that provides various technologies for air pollution reduction and control solutions for utility and industrial customers globally. The air pollution control technology segment reduces NOX emissions in flue gas from boilers, incinerators, furnaces and other stationary combustion sources. On Aug. 2 TheStreet’s Stockpickr selected FTEK as a stock under $10 “ready to soar higher.” Its market cap is about $109 million and 52-week trading range is $3.47-$7.01. It closed Aug. 15 at $4.94, up 3 cents for the day.

Palo Alto, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com) designs, manufactures and sells electric vehicles and electric vehicle components. It’s not a small cap (market cap is about $3.1 billion) but like A123 it has been the recipient of considerable federal funding (one estimate on line suggested $465 million). And like A123 it  enjoyed a high-profile start up. TSLA’s 52-week trading range is $21.50-$39.95. It closed Aug. 15 at $29.40, down 2 cents for the day

New Castle, PA-based Axion Power International * (OTCBB: AXPW.OB, http://www.axionpower.com/) manufactures high-performance, low-cost lead-carbon (PbC) batteries for a variety of markets, including mild- and micro- hybrid vehicles, which may be the commonest form of hybrid in the US within a couple of years (and already the most common in Europe). AXPW announced in May that the U.S. Department of Energy had awarded it a $150,000 grant toward the commercialization of its PbC batteries for micro hybrids. PbC batteries are as easy to manufacture as the older lead-acid batteries, but they use activated carbon instead of half the lead and are lighter, 100% recyclable, have a higher charge acceptance and faster recharging rates, all ideal for the micro-hybrid and mild hybrid markets.  AXPW has a market cap of $26 million and a 52-week trading range of $0.25-$0.84. It closed Aug. 15 at $0.30, no change on the day.

*Denotes a client of Allen & Caron Inc., publisher of this blog.

From Thomas Edison to Wave Power to Chinese Solar Imports to the ‘Air Car’

Random highlights on alternative energy taken from recent Internet postings:

 From Zimbio.com, a reminder that Thomas Edison is credited with not only inventing the light bulb, but he also designed an electric car battery (http://www.zimbio.com/Electronics/articles/Pu-dbQkqAzU/New+Lithium+ion+Batteries+Worked+Nissan+NEC). Edison released the first nickel iron battery in the 1900s as a cheaper alternative to lead acid batteries “with better reliability and longer life,” and was first used in electric cars around 1920, according to Zimbio. Today, the Nissan Motor Company and the NEC Corporation are working together on developing a lithium ion battery for hybrid and all-electric vehicles that will be a “breakthrough technology to make the auto industry even greener.” Their chief competition may be two other Japanese companies: Toyota and Matsushita Electric Industrial Co.

Pennington, NJ-based Ocean Power Technologies (Nasdaq: OPTT, http

://www.oceanpowertechnologies.com/) a pioneer in wave-energy technology that harnesses ocean wave resources to generate electricity, announced July 13 that they will team up with Lockheed Martin (NYSE: LMT) to develop a 19-megawatt wave energy project in Australia. Dubbed as one of the largest wave-energy projects ever, it is based on a grant from the Commonwealth of Australia. Both companies apparently see a future for wave energy, which according to the World Energy Council has the potential to produce about 2,000 terawatt hours of electricity a year or enough to meet 10 percent of the world’s current energy needs. OPTT stock got a big boost from the announcement, up to nearly $4 but then fell back. At close of market July 17 it was trading at $2.63, down 4 cents on the day. Its 52-week trading range is $2-$5.60 and market cap is $27 million.

Squeezetrigger.com, a website service dedicated to “help bonafide shareholders of publicly-traded US companies fight short selling,” filed a post July 17 suggesting six stocks are “ripe to go up in the next five weeks.” (http://delayedquotes.cboe.com/news/news_story.html?idnews=238966436&ASSET_CLASS=&ID_OSI=&ID_NOTATION=) The prediction is based on the stocks “high probability” to go up based on “seasonal tendencies.” Squeezetrigger has built a database that allows it to analyze more than 20 years of data to predict seasonal bias. One of those stocks is a smallcap, Milton, GA-based Exide Technologies (Nasdaq: XIDE, http://www.exide.com), a leading lead acid battery manufacturer. At close of market July 17, XIDE was trading for $3.37, up 5 cents for the day. XIDE stock has a 52-week trading range of $2.22-$7.89 and a market cap of $263 million.

The Coalition of American Solar Manufacturing announced that imports of Chinese solar cells and panels decreased in May, the second straight month there has been a decrease compared to the same month in 2011. The U.S. Department o Commerce report showed that Chinese solar imports totaled $124.1 million in May, down 45 percent from $225.8 million in May 2011. The reason? The coalition suggests the totals reflect “the market’s rising recognition of the costs, risks and uncertainties associated with importing Chinese solar cells and panels.” For the full year 2012 through May, however, Chinese imports are still ahead of 2011: $1.21 billion in 2012 compared to $993.2 million in 2012.

Finally, look for Tata Motors “Mini CAT,” also known as the “Air Car” to debut in August (http://www.caradvice.com.au/141944/tata-motors-mini-cat-air-car-to-debut-in-2012/). Correct, it’s a car with an engine that runs on compressed air. The Mini CAT has a tubular chassis, a fiberglass body glued, not welded, with a microprocessor controlling all its electrical functions. One small radio transmitter works the lights, turn signals and other electrical devices, which are few. Cost of the car is expected to be about $8,200 U.S. Also, the car has an access card instead of keys and is expected to cost about $1.12 per 100 kilometer to operate. Top speed is about 60 mph and its range is about 185 miles between stops at special air compressors for refueling.

Sold! EBay Buys into Alternative Energy Fuel Cell Power

Fuel cells made headlines in the major financial publications this week with the announcement that eBay is planning to build a new data center in Utah powered by, yes, alternative energy fuel cells. The new eBay data center will use approximately 6 million watts of power generated on-site by fuel cells made by Sunnyvale, CA-based, privately-held Bloom Energy, according to the New York Times (http://www.nytimes.com/2012/06/21/technology/ebay-plans-data-center-that-will-use-alternative-energy.html?scp=1&sq=james%20glanz%20ebay&st=Search).

eBay logo courtesy of LiewCF.com

While the new center, which will also serve eBay’s payment service PayPal, will be hooked up to the electricity grid as a backup, the news is considered a major victory for alternative energy backers, fuel cell believers and the environmental industry in general which has long complained that Internet companies are too often relying on coal power to run their data centers.

The Times’s story notes that fuel cell arrays are being used by major corporations including AT&T, Kaiser Permanente and Wal-Mart but nothing of this scale. Nearly all comparable data centers now draw the majority of the power from the grid.

Bloom Energy’s version of fuel cells are “essentially large batteries whose charge is maintained by by the hydrocarbon energy contained in natural gas,” according to the Times. Since the price of natural gas has plummeted in recent years, fuel cells have become more economically competititve, the story notes. And since the charge in the Bloom Energy cells is maintained by chemical reactions, not combustion, important efficiencies are gained. Another advantage is the fuel cells generate energy on-site, meaning no energy is dissipated as it travels along transmission lines.

All great news for environmentalists, Bloom Energy and, hopefully, eBay. But does it translate to hope for the mostly struggling small cap fuel cell companies? Based on investor reaction to the news, there seemed to be little benefit, at least initially.

Lathan, NY-based Plug Power Inc. (Nasdaq: PLUG, http://www.plugpower.com/) manufactures fuel cell systems for industrial off-road markets and stationary power markets. The PLUG stock, which was as high as $9 in early 2011, has traded much lower in recent months. Its 52-week trading range is now $1.11-$2.71 and its market cap as of June 21 was about $44 million. Roth Capital cleantech analyst Phillip Shen initated coverage of PLUG a year ago with a buy and a price target of $4. PLUG stock closed June 21 at $1.12, down 2 cents for the day.

Danbury, CT-based FuelCell Energy Inc. (Nasdaq: FCEL, http://www.fuelcellenergy.com/) makes a variety of fuel cells and its stock trades actively, more than 2 million shares a day on average. But apparently its second quarter numbers showing revenues down 15 percent from a year ago has soured investors. Its 52-week trading range is $0.80 to $1.95 and it closed June 21 at $1.06, up 2 cents on the day.

British Columbia-based Ballard Power Systems (Nasdaq: BLDP, http://www.ballard.com/) manufactures and sells fuel cells and fuel cell materials for the automobile and other markets. News from Ballard included business partnerships with Brazilian and European bus companies. But the company this week announced a revision in 2012 revenue and adjusted EBITDA downward due in part to contract negotiaations with a Brazilian customer. The stock, which was a high as $2.42 in April 2011 has dropped in recent months. It closed June 21 at $1.12, down 5 cents. Average daily trading volume is now about 124,000 shares.

Ontario, Canada-based Hydrogenics Corp. (Nasdaq: HYGS, http://www.hydrogenics.com) designs, develops and manufactures hydrogen generation and fuel cell products based on water electrolysis technology and proton exchange membrane technology. HYGS recently announced a significant order for a “power to gas” project for energy storage in Germany. The 52-week trading range of HYGS is $4.47-$7.10 but the stock trades lightly, about 7,500 shares a day. Its market cap is about $38 million. HYGS closed June 21 at $5.85, down 42 cents for the day.