Reap the Benefits of this Boom

We know that energy is a booming market sector. We also know that the alternative energy market is a booming sector, trying to combat Main Street’s energy woes. Let’s take our alternative energy investment theme for a stretch and consider another up- and-coming investment theme.

The pollution control industry has been around for a long time, with both large- and small-cap companies doing well in this market sector. With China becoming a bigger economic powerhouse every day, that country’s energy needs keep growing. Despite all the flash, China still remains, however, an “old-world” economy, burning coal as a major source of electricity.

Anyone who goes to a major Chinese city knows that pollution is widespread. Heavy smog is as normal as the sunrise. Regulation is catching up with industry in China, however, and the pollution control business is chomping at the bit to get a piece of the action.

One micro-cap company that just entered the Chinese pollution control business is Fuel-Tech N.V. (NASDAQ/FTEK). This company boasts some innovative technology that is focused on reducing nitrogen oxide from industrial boilers and furnaces. Founded in the Netherlands, with operations throughout the U.S. and the world, this little company is selling a lot of product.

The company just signed a $9.3 million contract for the installation of its “NOxOUT Selective Non-Catalytic Reduction” technology on four newly constructed 600 megawatt coal-fired boilers in China. The installation will take place at the Ligang Electric Power Company Limited in Jiangyin, Jiangsu Province. The contract represents the company’s first foray into the Chinese marketplace.

So it isn’t just raw energy production that is booming, the spin-off effect from strong energy demand has created a full fledged bull market in the pollution control business. China, in particular, is the big marketplace for this new investment theme, and I hope to find more companies that are reaping the benefits of this new industry boom.