Jim Chanos of Kynikos Associates, in a presentation entitled “Alternative Energy: Does Solar + Wind = Hot Air?”, said that wind (NYSE:FAN) and solar (NYSE:TAN) power will never be cost-effective sources of energy, stating that they just aren’t efficient. He also said that the growth in green jobs might be misleading, as most of the jobs being generated by the industry are in construction, not in technology, and will disappear after the infrastructure is set up.
Chanos may have made a few enemies, first when he referred to advocates of clean renewable energy as “greenies”, and then when he named the stocks people should dump, Vestas Wind Systems (CPH:VWS) and First Solar (NASDAQ:FSLR). According to Chanos, Vestas, which trades in Denmark, was “darling until recently” but has been steadily going down and is likely to continue along that trend due to “questionable accounting”.
Chanos also said that First Solar’s (NASDAQ:FSLR) quality control had been deteriorating and that they have been having operational issues and negative cash flow. Worse still, Chanos says that First Solar has been hiring managers with no industry experience who are coming in and unloading their holdings. Spokesmen for both Vestas and First Solar have not commented at this time.
However, it’s important to take everything Chanos says with a grain of salt, considering he also thinks all the investor interest in China is the result of a lot of hype that won’t amount to much. Look here to see why he’s wrong about China.