Green Chip: “Clean Air Cash-Outs — $1.6 billion Clean Truck Superfund”

By Travis Johnson, Stock Gumshoe, March 25, 2008

Here we have another newsletter from the folks who brought us Green Chip Stocks, which has been riding herd on the wave of environmentally friendly investors with a near-constant stream of new teaser ads.

This latest ad, from Jeff Siegel for the new service, talks about “clean air cash-outs”, which as I read it are just the money making opportunities of the greenification of Wall Street. He adds some cynicism, talking about the fact that these clean air changes and innovations pushed by businesses are really designed to grow profits, not to clean the air (though they may do that, too). I don’t expect any of the wise, jaded and clear-thinking Gumshoe readers are surprised to hear that.

We hear nearly every day about investment opportunities that should allow you to make millions on the back of new government regulations, carbon limits or trading, high oil prices, or consumer demand for Green. So what do we have this time, and is it worth a second look?

The name of the special report they’ll send you for subscribing to the service is “I-LNG: California’s Hottest Clean-Air Cash-Out.” The newsletter they want you to subscribe to is Alternative Energy Speculator, by Jeff Siegel and Nick Hodges — apparently they’re launching with a “special deal” at $199 for subscribers, but the “normal” price will be $499. You might recognize those names from Green Chip Stocks, which is their “greener” and cheaper newsletter — apparently this new Alternative Energy Speculator service is for “stopgap” investments that help develop energy independence and reduce pollution or fuel use, but that are potentially more explosive and aren’t necessarily really specifically “green” or renewable energy.

This time we’re talking about an interesting little niche in the world of alternative fuel vehicles — trucking. Specifically, the teaser talks about Southern California, and the fact that the smog and emisions are so bad from the massive trucks that ply the port areas of Long Beach and Los Angeles (mostly taking containers from the ports to their destination, but also moving stuff around within the ports), that they insituted significant new emissions reductions for these large truck fleets.

And to coincide with these new emissions standards, they realized that to just do away with the trucks would choke the ports, which are already at capacity, so they also passed a $1.6 billion government “superfund” to help replace these truck fleets.

This teaser company is the one who makes the engines (or modifies them, really), to let them run on LNG. That’s liquid natural gas. So yes, it’s not like the trucks will run on solar power or be a fleet of giant Toyota Prius clones, they’re still using fossil fuel, but natural gas burns so much more cleanly that diesel or gasoline that the hope is that this can dramatically reduce the southern California smog.

So … what are we dealing with?

Well, the Thinkolator is on the case … and I can tell you that the truck that’s being aimed squarely at this new fleet revitalization is probably either the Kenworth T800 or the Peterbilt 386. But Green Chip is talking about a tiny company, and I’m sure they don’t want you to buy PACCAR (parent of both Kenworth and Peterbilt) — though that may be a good pick, too, and I know they’ve been recommended by Motley Fool’s Stock Advisor in the past and the company is pretty cheap and has a good reputation for innovation.

No, what we’re looking at here is the engine company, not the truck maker. And the company that’s being teased here is …

Westport Innovations (WPIVF on the pink sheets, WPT for the main listing in Toronto)

This is a company that has developed a LNG modification, called HPDI, for a Cummins engine, and it does have an exclusive deal with PACCAR to sell these trucks. And from what I can see, they aren’t just blowing smoke about this being the only truck that’s approved for this $1.6 billion superfund for fleet replacement. I don’t know how long it will remain the only truck, but it certainly seems likely that they’ll get a lot of orders for this. Westport is itself specifically focused on this niche, developing engines for all kinds of alternative fuels, from LNG and