Solar-powered hype, or buying opportunity?

One company that has been largely bypassed by the hype, but seems positioned to benefit from solar's surge, is Evergreen Solar. Evergreen makes photovoltaic modules -- the main component in solar-electric systems -- using a proprietary, cost-effective technology.

Evergreen recently announced a four-year agreement to sell $100 million worth of its modules to Mainstream Energy, a company that sells and installs commercial and residential solar- energy systems. Meanwhile, Evergreen's strategic partnerships with Q-Cells AG, a leading German solar company, and Norwegian solar powerhouse Renewable Energy Corp., have helped the company establish a presence in European markets, where -- natch! -- government subsidies are far more generous than they are in the United States.

Evergreen's stock price has fallen by about half since hitting a 52-week high of $17.50 last spring. That's because of worries that a shortage of silicon, the pricey material used to make solar cells, would hurt all manufacturers. But Evergreen should be one of the least-affected companies, thanks to its silicon-stingy technology.

"It's pushing the envelope when it comes to using less silicon per watt of electricity," says Mark Townsend Cox, founder of the New Energy Fund, which specializes in clean power. That could make Evergreen a buying opportunity, even though the company has yet to earn a penny. (Analysts are forecasting earnings of 16 cents a share in 2008.)

Betting on a single pure-play solar stock is a risky move, and not one to be made with the mortgage money. Investors looking to spread things around a bit may want to try the New Alternatives mutual fund. Its three-year annualized return of more than 15 percent  outperformed its midcap blend category, and the fund's father-and-son managers, Maurice and David Schoenwald, invest heavily in solar companies, both in the United States and in Germany. But they also invest in all types of clean-energy stocks.

So, if wind power suddenly shoves solar out of the limelight and becomes the hot energy alternative, the fund will have hedged its green bets. As perhaps should you.

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