With Help from California, Solar Gets Fired Up

My home state of California has been in the solar industry's spotlight in recent years. Our Governor, Arnold Schwarzenegger, adopted a well-publicized plan to embrace renewable energy in the sunshine state. Based on this plan the State's 20% electricity has to come from renewable sources by 2013.

So far Cali gets 11.8% of its electricity from renewable resource according to the state energy department. So we still have to build additional 8% based on either solar or wind. So far solar seems to be the best approach because of the abundance of sunlight. The PG&E (PCG) deal with SunPower (SPWR) and Optisolar is a good example. For investors, the question is who else will benefit from this. We believe First Solar (FSLR) and SPWR will continue to grow along with it, Evergreen Solar (ESLR) may have problems ramping up additional capacity to supply California's growing demand since the company probably has to supply all its capacity to the two contracts it has already signed.