Turn a Profit by Investing in Solar Panels

solar panelsAdvancements in photovoltaic cells, which convert sunlight directly into electricity, have greatly decreased the once prohibitive cost of solar panels. Additionally, historic highs for the costs of energy that are likely to continue to ascend suggest that an investment in solar panels for your home may provide you with healthy returns.

One company that is lowering the barrier of entry into owning solar panels is SolarCity Inc. in California. They offer a 15-year lease for solar panels that includes installation, free repairs and free removal at the end of the lease. They also guarantee that you receive the power production promised, which they can monitor remotely, according to the Wall Street Journal. The company has plans to expand to Oregon and eventually the East coast.

Even in cloudy regions like Seattle or New York, there is still a good opportunity in solar power. Solar panels work surprisingly well in less than sunny conditions. Findsolar.com gives Seattle and New York a good rating for sun power availability. Germany produced over half the world’s solar energy in 2006 despite having half as many sunny days as Portugal, according to the Washington Post.

Leasing a 16-panel system for $85 per month would generate 3.2 kilowatts of electricity and reduce a $200 electric bill to an estimated $75, according to SolarCity’s site. Therefore, solar panel lessees would save an estimated $40 per month in the first month. However, payments increase 3.5% each year, so the electric rates would have to increase at this rate or higher to maintain this savings. Another disadvantage is that at the end of the lease you do not own the system and would either have to buy it, upgrade or have it removed. A more sensible option may be to secure financing a system with a solar panel retailer.

If energy prices continue to rise, you can turn a good profit by producing your own electricity and even possibly selling it back to the energy company. Some states, such as California, offer tax incentives to offset some of the initial cost for the system. Washington state will buy solar generation at 15 cents per kWh until 2014. The flip side is that technology will likely advance considerably over the next decade and you may be stuck with an obsolete model that is much less efficient than future models. The current solar technology only captures a small portion of the sun’s energy and billions of dollars are being invested into research and development to produce more efficient solar cells. The improvement in this technology could follow a similar path as computers, in which efficiency could double every two years and result in your system being as worthless in 15 years as a 1993 computer is today.

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Lessons from Lunch with Warren Buffett

Warren BuffetGuy Spier, one of the investors who helped pay the $650,100 winning eBay bid to have lunch with Warren Buffet, shared some of the lessons he learned from the greatest investor in the world in a recent Time article. While you may not be able to afford to pay more than $3,600 a minute for advice from the Sage of Omaha, you can still learn vicariously by reading some of Buffet’s enduring lessons on investing and on life.

Do the Right Thing Even if it’s Hard

Buffet has become one of the richest men in the world while never sacrificing the highest ethical standards. “People will always try to stop you doing the right thing if it is unconventional,” said Buffet.

Listen to Yourself, Not the Crowd
Buffet learned at an early age from his father that it is important to listen to yourself rather than seek the affirmation of others. Although he was heavily criticized for not investing with the crowd in technology and Internet stocks in the late '90s, he stuck to what he believed and turned out to be right. During the lunch he asked his guests, “Would you rather be considered the best lover in the world and know privately that you're the worst — or would you prefer to know privately that you're the best lover in the world, but be considered the worst?"

The Numbers Don’t Lie
Buffet said that he limits contact with the managers of businesses that he invests in, choosing rather to examine the company’s financial records. By relying on the numbers he is able to focus on neutral information and prevent outside noise from affecting his decisions.

Stick to Your Knitting
Buffett shared was that he only focuses on his “circle of competence” when considering investments. As a result, when he finally makes an investment, he has no doubt that he is right.

Enjoy Life
Buffet wrote in Berkshire’s annual report that he “tap dances to work.” It is evident that he loves what he does and does everything with great passion and excitement. By the way, according to Spier, Buffet doesn’t say no to dessert.

Be Generous
Buffet’s greatest legacy may be his generosity. He has committed to giving the great majority of his fortune to the Bill and Melinda Gates foundation and the proceeds from his annual lunch go to the Glide foundation to help the poor. I believe that Buffet’s affinity for contributing to the greater good is a major key to his success.

Guy Spier wrote that his time with Buffet “was worth every dime,” and it turns out he may have underpaid. The winning bid by Zhao Danyang for next year’s lunch was $2.1 million.

Image Courtesy of Wikipedia Commons

How To Hedge Your Fuel Like Southwest

Oil SeesawFew people know that there are ways that you can hedge fuel prices as an individual, similar to how Southwest Airlines hedges oil. Southwest has been successful at hedging their fuel by buying contracts that give them the option to buy fuel at a fixed price in the future. Here are a few ways that you can implement a similar strategy:

My Gallons

Mygallons.com is a new site that lets anybody buy credits for fuel at today’s prices. After you pay an annual membership fee of $29.95 to 39.95 you get a debit-type card that you could use at 95 percent of U.S. filling stations according to the site. However, soon after MyGallons launched their service, their deal with the payment processing network fell apart, so the cards they issued are not accepted anywhere until MyGallons can find a new partner. While this illustrates the risk of being an early adopter, look for MyGallons and similar companies such as FuelBankUSA to offer such services in the coming months. I wouldn’t buy too many credits, though. If MyGallons goes under, they may not be required to refund your deposits.

Fuel Banks

Fuel banks allow you to purchase reserves of gasoline on the commodities market. First Fuel Bank in St.Cloud, Minn., has been around since 1982, when gasoline only cost about $1 per gallon. People who bought in as recently as 1997 could still be paying less than $1 per gallon. Unfortunately, you have to live in or near St.Cloud Minnesota to take advantage of this, since their pre-paid card is good at only six locations.

U.S. Oil Fund ETF

Another tactic to hedge fuel is to buy stock in the U.S. oil fund ETF (exchange traded fund) which is available on the American Stock Exchange (ticker symbol: USO). The objective of the fund is to track with the movement in price of crude oil, although it doesn't always achieve this objective. If the USO does follow the price of crude oil, then you can profit as everyone else suffers. In addition to the uncertainty that the USO will track with crude oil market prices, changes in crude prices don’t necessarily match fluctuations at the gas pump. Further, according to Fox News, the USO fund requires that you pay taxes on gains annually, even if you don’t sell.

There are many more ways to protect yourself if you think fuel prices will continue to rise. For instance, you could convert to ethanol by purchasing a home ethanol distillery such as the EFuel100 and stockpile sugar or corn in your backyard. You could invest in solar panels and drive a hybrid. And, of course, you can move within walking or biking distance of work so you don’t need to use as much fuel. If you feel fuel prices will drop in the future, you can be like Glen Peck from Annapolis, Md. He has two Hummers parked in his driveway and is a board member of a group called The Hummer Club, according to the Associated Press.

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Moon Property Rights Are Closer Than You Think

MoonWith U.S. real estate prices falling and NASA’s Phoenix mission successfully landing on Mars, this may be the perfect time to turn our attention to lunar real estate. An article this month in Popular Mechanics discusses why owning your own lunar real estate may not be totally out of the question. Although the 1967 Outer Space Treaty that was ratified by 62 countries restricted any country from claiming territory in outer space, it did not restrict private or corporate ownership. The proposed 1980 Moon Treaty would have banned private property ownership of the moon, but it was never ratified by the U.S. As a result, it is generally accepted that claims of private property on the moon would be recognized. Effective use of unclaimed land has historically been used to establish ownership, so a corporation that established a base on the moon could claim legal precedence if a dispute arose.. Even if someone sent robots on their behalf, they could make a valid claim based on the legal precedence of ownership of salvaged ships being granted to individuals who discovered them with robotic submarines.

You can buy lunar property with a prime view of Earth from the Lunar Embassy’s website. For just $24 plus shipping, you can receive the deed to an acre of land on the moon. Dennis Hope, founder of the Lunar Embassy, says he has sold 500 million acres, although this is questionable when you see how bad the website is. A deed from the Embassy includes a declaration of ownership filed with the U.S, Russia, and U.N. on the basis that Hope originally sent a claim to the U.N. and did not receive any objections. However, Glenn Harlan Reynolds, a University of Tennessee law professor says in a Popular Mechanics podcast that millions of owners could form a worldwide constituency that could require governments to recognize the group’s claim.

This could create a legal battle between individuals with a lunar deed and corporations who have actually landed on the moon. These individuals could extort corporations for a share of their profits, similar to people who buy Internet domains and wait until a company is willing to pay for rights to it. There are several private expeditions underway to land a robot on the moon and claim a $30 million dollar prize offered by Google. This seems to be a better investment than buying property through Lunar Embassy.

Image courtesy of Bluedharma

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Tesla to Save Suburbs with Electric Cars?

Tesla CarTesla Motors, makers of the remarkable electric super car that can accelerate as fast as a Ferarri, putting the Prius to shame, has just announced plans to begin production of a $60,000 electric sedan that would seat five and go 225 miles between charges. The Model S would effectively put the price of an all-electric car that doesn't sacrifice performance within reach of a much larger segment of the population.

This is a big development for our energy-strapped nation. It was unknown whether electric battery technology was advanced enough to be cost-effective for people without deep pockets. A $60K price point in just two years would be a game changer, and in 10 years electric cars could be ubiquitous. Tesla’s co-founder and chairman, Elon Musk, is on the record with a prediction of a sub-$30K offering in four years at the most according to Palo Alto Daily News. Unless Tesla is bluffing, they may have discovered something special in battery technology, which may just save suburbia from an inevitable death.

However, Tesla has disappointed before with production delays and an inability to deliver enough supply to the hundreds of customers yearning for their environmentally-friendly race car, so there are plenty who doubt that Tesla can deliver on their goal to bring electric cars to the masses.

If you are interested in investing in the future of the auto industry, you may have soon have such an opportunity. Musk has told C-Net that there are plans in the works for a Tesla IPO by the end of 2008, which would raise an estimated $100 million. But perhaps an even better investment option is to head over to the Tesla Motors site where you can pay $55,000 to lock in a production slot for the 2009 Tesla Roadster. As your delivery date approaches, you could sell your spot in line for a nice profit, which you can then put toward a more practical Model S in 2010.

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Home For Sale: Fully Furnished; Concubine Included

It is said that home is where the heart is, but usually home and heart don’t sell as a package deal. However, desperate times call for desperate measures, and one Ms. Deven Trabosh—who apparently lost her dignity with her equity—is selling her house and her hand in marriage as a package deal. It’s like Indecent Proposal meets the Amityville Horror.

Because the story is so sensational, Trabosh has been getting plenty of coverage on the offbeat news waves, and I hesitate to give her any added attention. I’d rather write about the economic impact of recession on the sex trade and plastic surgery industries, but Ms. Trabosh represents both subjects nicely, as seen in this Boston Globe article. Most coverage of this debacle has made it out to be a human interest story, portraying this woman—in her own words—as “a Princess Lost in America” with a fetish for European men, but it is far more compelling to view it in terms of a different kind of interest: the return on investment for any sap who decides to play house with Ms. Trabosh, or—as I like to call her—the Trabesty.

Florida’s real estate market has been one of the hardest hit in the country, and now may be the best time to buy property as a long-term investment. With so many foreclosures available, is it really a good investment to buy a luxury home at more than the full asking price? The Trabesty listed the home at $340,000 on a traditional real estate site, which is already somewhat steep for such a saturated market, but then she upped it to half a million in the house/harpy package deal. Apparently, she thinks she’s worth roughly $160,000 dollars. How...generous.

We can only assume that most interested buyers will be interested mostly in the Trabesty’s tangible assets, which were described in the article as “Barbie-esque” though they are more appropriately labeled “Barbie-qued”. Over time, these assets can be expected to depreciate significantly, require high-maintenance and all without any hope for resale. It is true: Like all “alternative investments,” buying Ms. Trabosh’s claw in marriage may offer benefits that can’t be put in monetary terms. But so can investing your money in deserving, investor-driven charities instead of buying a shot with an opportunist who may just divorce you and take “her” half of the house in a matter of months.

Any lonely fellow who contacts the Trabesty—and they do—is advised to conduct full and proper due diligence. I recommend seeing if she can be leased before committing to buy, and I certainly recommend a pre-nup to go with this aging pin-up. Trabosh says she is offering a fairy tale come true. I’ll certainly agree that the story is "grim", but will she find Dunce Charming? If you believe in fairy tales, her character is more likely to end up in the oven than at the altar.

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