So you think rising energy costs are a good long-term investment trend. But you're leery of investing in big oil companies because of small things like the Exxon Valdez oil spill and, well, global warming. Is there a play for you in alternative energy? Sure.

        Back in the energy crisis of the 1970s, most alternative energy devices weighed as much as a Volkswagen and produced enough energy to run a hotplate. Today, many are smaller and more efficient, but they can still be expensive and impractical. That's not a problem from an investment standpoint: Lots of interesting new things, such as computers, start their life cycles as clunky and expensive.

        Many of the purest plays in alternative energy do have considerable investment problems.

        Consider Vestas Wind Systems, one of the world's largest windmill makers. Vestas has about 25 percent of the world market for wind turbines and has seen 40 percent sales growth each year since 1996, said David Mows, analyst for Friends Ivory & Sime, an investment management company. He thinks the company will grow at a 25 percent annual rate in the future. “Wind power is 0.25 percent of world energy now and will be 3.9 percent by 2013,” he said.

        So what's the catch? Vestas is a Danish company, and its stock isn't traded here. Aside from having to convert earnings from euros to dollars, it's not an easy — or cheap — stock to buy. At Fidelity Brokerage, for example, you'll have to call a customer representative to buy 100 shares for you. That will cost you $59 plus an additional $50 for making the foreign purchase. At Schwab, the commission ranges from $39 to $55.

        Fuel cells are another part of the alternative energy equation. Those convert fuel to energy without combustion and are cleaner and more efficient than generators that burn fuel. The principle has been known since 1839, but fuel-cell technology didn't get much attention until its use in the 1960s by NASA.

        Several companies make fuel cells. David Shoenwald, manager of New Alternatives fund, owns Plug Power (ticker: PLUG), which makes fuel cells for commercial and residential use. General Electric is developing a distribution network for Plug Power's residential fuel cells; so far, there are two U.S. distributors.

        Mr. Shoenwald's largest holding is FuelCell Energy (FCEL), the biggest fuel-cell company. And Julie Gorte of The Calvert Group likes Proton (PRTN), which concentrates on the commercial market.

        So what's the problem with these? Not the technology. But Plug Power and Proton are both very thinly traded, which means very small purchases or sales can affect their prices dramatically. Plug Power, for example, trades about 539,000 shares a day, which isn't much by Wall Street standards. ExxonMobil, the largest oil company, trades about 6.3 million shares a day.

        So fuel-cell producers can be erratic, to say the least. Plug Power, for example, had a high of $156.50 a share in January 2000 and a low of $25.75. It ended the month at $93.75 and closed Thursday at $15.06. Even FuelCell Energy, the best performer of the lot, is hard to bet on. “It's difficult to value because it has no current earnings,” Mr. Shoenwald said. “But when you get into alternative energy, that's what you get.”

        Solar companies are similar. Evergreen Solar (ESLR), a favorite of Calvert's Gorte, has no earnings, either. Trading volume averages just 72,000 shares.

        Many so-called “socially conscious” funds simply invest in natural gas companies because natural gas is cleaner than coal or oil. Enron (ENE), the nation's leading dealer in natural gas, is a top holding of Pax World Balanced fund. Calpine (CPN), which produces power from geothermal sources and natural gas, is another favorite.

        Mark Regier, director of social research at MMA Praxis funds, warned that if you overlook all oil companies, you overlook some opportunities in alternative energy. BP Amoco, for example, has the largest solar energy division in the world. “Both BP and Shell are saying, "Let's get real and talk about this,'” Mr. Regier says.

        So what's an investor to do? Don't bet everything on small alternative energy companies or you might not have enough left to pay the gas bill. Turner New Energy & Power Technology is an interesting offering from the high-powered Turner Investment Partners. The fund opened Thursday. Call 800-224-6312.

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