Yesterday's News: Another $1.4 Million Worth of Business

One of the most compelling aspects of China Energy as an investment, aside from last year's 96% increase in revenue, has been the reliability and consistency of the flow of good news. It's nice to see publicity that will foster interest in the stock, but more importantly, it's nice just to see that the company's getting results that are meaningful enough to actually talk about. Case in point - the Tuesday morning announcement that China Energy Recovery (or CER) has been awarded a $1.4 million contract to build a waste heat recovery system for Hubei Yangfeng Group... one of China's biggest phosphate fertilizer producers.

The only detail I'm going to expand on is the size of the contract. The $1.4 million deal alone is the equivalent to 6% of all of last year's top line, and it seems like these contracts are coming down the pike on a regular basis now. I'd be very surprised if 2009 isn't significantly better than 2008, as they had already booked about $30 million worth of deals for this year.

We've covered the fiscal metrics ad nauseam though, so I won't pound them in this time around.

Instead, I want to offer to take some of the ambiguous data (to a layperson, including me) in the press release and put it into terms we can all relate to. If you were impressed by the dollar figures involved, I think you'll be equally impressed by the quantifiable impact China Energy's systems make in the advancement of clean energy. From the news release...

"The two sets of waste heat recovery systems for Yangfeng Group are designed to generate 120 tons of steam per hour. This is equivalent to nearly 24MW of heat energy generation capacity and will enable Yangfeng Group to reduce the cost of purchasing steam from outside sources needed to support the facility operations. In total, this project is expected to achieve an annual saving of roughly 57,100 tons of coal (coal equivalent), which would otherwise be required to produce the same amount of power, and consequently the reduction of roughly 151,700 tons of carbon dioxide emission from the burning of that coal each year."

Care to guess how much energy 24 MW (megawatts) worth of heat energy capacity is? One megawatt worth of electricity capacity is enough to power about 500 homes, on average. There's a slight difference between 'heat energy' megawatts and 'electricity' megawatts, but you get the idea - 24 megawatts worth of energy production is still a massive amount of conserved energy.

You know how much coal 57,000 tons worth of coal is? I couldn't even fathom what that would look like in my head until I did a little digging. One coal car on a train can hold about 140 tons worth of coal. Dividing 57,000 by 140 means about 400 coal cars worth of coal (or equivalent) won't be annually consumed now because of CER's waste heat boilers. Stunning.

As far as how to put 151,700 tons of carbon dioxide gas into perspective, it's a little tougher. I was able to find out, however, that one ton of CO2 gas (not in solid form) would fit into the volume occupied by an average three-bedroom house. So, 151,700 tons of CO2 roughly means 151,700 "average houses worth" of carbon dioxide will NOT be spewed into the air thanks to Hubei Yangfeng Group's newest equipment.

Geez - no wonder this is all such a big deal, and no wonder China Energy's boilers are in such demand.

Like we've said already, CGYV is one of the most attractive prospects we see right now, and even more so when put into the above perspective.