Sat, Oct 22, 2016
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge fund manager Chanos says it’s time to short solar and wind energies

Thursday, May 26, 2011
Opalesque Industry Update – Celebrated short-seller James Chanos, founder of Kynokos Associates, is taking aim at the “greenies” or clean energy companies. Of particular interest to him are solar and wind energies which he said are ripe for shorting.

Arriving at the annual Sohn Conference in New York held on Wednesday, Chanos declared, “We’re gonna upset the greenies. The problem is the companies we are looking at are not capable yet of being baseline power generators. Wind and solar are not efficient.” Chanos has good reason to believe he was right. He said that among the many problems inherent to these green energy technologies are the high cost of maintaining them which discourages demand.

He particularly criticized Vestas, a wind energy firm. Chanos accused Vestas of resorting to questionable accounting practice to make it appear that the firm is financially viable when in truth their cash flow “had turned down dramatically and the company had declining returns on capital.”

But for him, the most exciting sector to short at this time is solar power companies. He described solar companies as inefficient and are more costly compared to gas and coal-powered plants.

Indeed, government policies are pushing people to switch to solar energy rather than genuine demand, Chanos said. Some European countries even reduced their dependence on the use of solar power which has further decreased demand for the technology.

As for the best solar firm to short, Chanos is betting his money on First Solar, which he said is using a questionable old technology and currently experiencing operating problems arising from low-cost competitions.

More bad news for First Solar is that some of its key management officials are leaving the firm. ”They are seeing the same things we are seeing,” Chanos declared. “We advise you to heed their warnings.”

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. M&A - U.S. hedge fund HarbourVest is shock winner in the £1.1bn SVG Capital takeover saga, Hedge fund Parvus shows hand, toppling William Hill merger deal[more]

    U.S. hedge fund HarbourVest is shock winner in the £1.1bn SVG Capital takeover saga From The fierce battle to buy Britain's biggest private equity group has come to an unexpected conclusion, with the original bidder walking away with the prize. SVG Capital has agreed

  2. Marc Lasry: Energy is still a phenomenal opportunity[more]

    From Distressed debt specialist Marc Lasry said energy debt is still a "phenomenal opportunity" because investors can get "massively overpaid" for the risk they take on. There are "huge opportunities" in the energy sector especially in restructurings, the Avenue Capital Group CEO said Tues

  3. Opalesque Exclusive: Ex-SAC manager re-emerges with market neutral hedge fund[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: A manager re-emerged from the SAC battleground last year to launch his own hedge fund under the umbrella of New York-based investment firm Endicott Group.

  4. North America - Hedge-fund manager Kyle Bass says the U.S. is on track for stagflation, Billionaire hedge fund titans Dinan, Lasry on election, markets and best investment ideas[more]

    Hedge-fund manager Kyle Bass says the U.S. is on track for stagflation From Kyle Bass, founder of Hayman Capital Management, on Wednesday warned that the U.S. is headed toward so-called stagflation. Stagflation is typically described as persistently high inflation and hi

  5. Other Voices: Follow the advice of investment consultants - I think not[more]

    Mark Rzepczynski, Founding Partner, Chief Investment Officer AMPHI Research and Trading, writes on Harvest Exchange: Investment consultants are a force to the reckoned with in the pension world. They advise and drive many pension decisions around the globe. Consultants literally control trillion