Although solar power is a developing area with commensurate risk, triple-digit oil prices (as well as increased attention by politicians and the media) have helped move alternative energy to the forefront of investor attention.

Today, we examine a pair of small-cap firms that are involved in developing solar technologies. (For those seeking more conservative, larger-cap plays on the sector, I’ve compiled a 35-page report on alternative energy, available for free to all SmallCapInvestor.com readers.)

First up, The Real Nanotech Investor editor Gregg Early chooses Spire Corporation (Nasdaq:SPIR), which specializes equipment in the production of terrestrial photovoltaic modules from solar cells, as his favorite pick.

Despite its small market cap of $114 million, it is a well-diversified firm with additional operations in biomedical and biophotonic research as well as semiconductor and opto-electronic technologies.

Early says that Spire has received a purchase order for its solar cell modules from U.S. Dept of Energy's National Renewable Energy Laboratory.

"Spire continues to credentialize its solar division and expand operations," he says. Indeed, after building its first solar panel production in Portugal, Early says that in recent weeks the firm also announced an order for a turnkey solar panel production line from its Spanish client Fluitecnik SA. The firm also announced a 12-megawatt factory in the Dominican Republic.

Early says that while the stock is already up 120% since he first recommended it, he believes that this is "the first leg up for this nanotech/green tech pick." Despite expected price volatility, he says, "Spire Corp.'s stock is cheap now."

Our second solar small-cap pick is Worldwater & Solar Technologies, Inc. (Nasdaq:WWAT), which earned a “buy” recommendation from two noted advisors.

Jim Nelson, contributing editor to Agora's Penny Sleuth says, "We see a huge buying opportunity in solar-pumped water. WWAT is a microcap solar technology development company that focuses on farmers' needs. Its very simple, yet innovative AquaMax system is a series of solar panels set up on a farm, which tie into the power grid already in place. This gives the farmer a secondary source of power for irrigation systems."

Nelson says that AquaMax keeps water flowing even if the grid goes down, which, he says, saves farmers thousands of dollars when the sun is shining, and eases the strain on pump motors. This increases the lifespan and costs of replacing the motors.

This is a speculation. Nelson says, "This company doesn't come with a guaranteed profit. In fact, much of the anticipated growth is already factored into the shares of Worldwater."

Indeed, he says, just between Jan. 1 to mid-summer of last year, the stock rose over 500%. But, he says, the shares have since fallen 50% from their peak, suggesting the stock could now be poised to provide strong results in coming years.

WorldWater is also a long-standing recommendation from Neil George, editor of the large-cap-oriented Personal Finance newsletter and the small-cap-focused Inner Circle newsletter.

He focuses on the firm's opportunities outside of the farming sector. According to George, the city council of Ocean City, N.J., has awarded WorldWater a contract to build a $4 million solar system for the city, which is expected to produce nearly 550,000 kilowatt hours of energy in its first year.

George contends that this could allow Ocean City to offset approximately 17% of the city's total yearly electricity requirements for buildings that it owns and/or operates. The project, he says, should be completed later this year.

"The company's ability to continue to land these deals bodes well for coming quarters and years. The stock remains a buy," he says.