Thu, Nov. 17, 4:57 PM
- Entergy's (NYSE:ETR) FitzPatrick nuclear power plant in New York is approved for sale to Exelon (NYSE:EXC) by the New York Public Service Commission.
- ETR will transfer the 838 MW plant's operating license to EXC for $110M upon closing, subject to approval by federal regulators.
- Approval was expected, since the state created a nuclear subsidy program in August intended to rescue upstate nuclear plants including FitzPatrick.
- Separately, ETR also won approval from the Louisiana Public Service Commission to build a new natural gas-fired, combined-cycle power plant in St. Charles Parish.
- The approval clears the way for construction of the 980 MW unit, expected to be in service by June 2019, at an estimated cost of $869M.
Fri, Oct. 28, 2:35 PM
Wed, Oct. 26, 1:22 PM
- Nuclear power will come to an end in the U.S. if the industry fails to obtain more government support, Carlyle Group predicts.
- U.S. nuclear reactors need more subsidies to keep running, such as a federal carbon tax that would reward them for their zero-emissions power, according to Bob Mancini, co-head of Carlyle's power unit.
- Mancini points to measures approved in New York as an example of the kind of help nuclear power plant owners will need to survive; in August, NY state regulators cleared ~$500M/year in subsidies as part of a clean energy plan to reduce greenhouse gas emissions.
- Relevant tickers include EXC, ETR, DUK, D, NEE, SO, PCG, ED, EIX, AEP, PPL, DTE, FE, NRG, PNM, POR, SCG, WR, XEL, LNT, GE, URA, NLR
Tue, Oct. 25, 6:34 AM
Mon, Oct. 24, 5:30 PM
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Mon, Oct. 17, 2:48 PM
- PG&E (PCG +1%) is added to the Conviction Buy List with a $67 price target at Goldman Sachs, replacing Entergy (ETR +0.8%), as the former is considered a more attractive option for investors seeking yield and dividend growth.
- Goldman expects PCG to achieve its 60% payout ratio target in 2018, a year earlier than guidance, and to generate 8.5%-10.5% annual dividend growth through 2019; the firm thinks 2017 and 2018 will mark PCG's first relatively normal years of earnings after the 2010 San Bruno pipeline incident and multiple years of related cost inflation and regulatory penalties.
- ETR remains rated at Buy as its relative valuation remains compelling, but regulatory factors present a modest near-term risk, as an increase in ETR’s regulated nuclear operating costs would add pressure to 2017 forecasts.
Mon, Oct. 3, 11:58 AM
- An oil spill last Friday at Entergy's (ETR -1.6%) Indian Point Nuclear Power Plant was caused by a cooling center malfunction, state officials say.
- The oil leaked into a discharge channel that leads to the Hudson River, although officials say no sheens of oil have been spotted in the river; ETR says the oil lubricates plant equipment and is not radioactive.
- More than 40 spills and unexpected shutdown events at Indian Point since 2011, and New York Gov. Cuomo has long advocated shutting it down.
Tue, Aug. 9, 10:39 AM
- Exelon (EXC +0.4%) says it will take over ownership and management of Entergy’s (ETR -0.1%) James A. FitzPatrick nuclear power plant, after New York proposed subsidies for the industry earlier this month as part of a goal of eventually obtaining half the state’s power from renewable sources.
- Under the agreement totaling $110M, ETR will transfer FitzPatrick’s operating license to EXC, which has committed to refueling FitzPatrick in January 2017.
- EXC also reported better than expected Q2 earnings, reflecting higher utility earnings due to favorable impacts of regulatory rate increases; EXC guides Q3 EPS of $0.65-$0.75, below $0.80 analyst consensus estimate, while reaffirming full-year EPS guidance of $2.40-$2.70 vs. $2.55 consensus.
Wed, Aug. 3, 12:47 PM
- The divergent outcomes for Exelon's (EXC +0.2%) money-losing nuclear reactors in New York and Illinois boil down to one governor who desperately wanted to rescue them and another who was not so sure, Bloomberg's Mark Chediak and Jim Polson write.
- New York's Public Service Commission voted for the funding on Monday as part of a broader plan to spark the development of clean energy; EXC said following the decision that it would invest ~$200M in two nuclear plants next year and continue discussions to buy Entergy's (ETR +0.8%) FitzPatrick nuclear plant that is expected to close.
- In New York, EXC benefited from Gov. Cuomo’s support and his determination to help upstate reactors as part of a clean energy plan, as well as the advantage of being able to tap governor-appointed state regulators to weigh the nuclear bailout instead of the legislature, according to the Bloomberg analysis.
- Meanwhile in Illinois, EXC struggled to gain high-profile support for legislation it backed that would have raised customer bills to keep its nuclear plants open, and Gov. Rauner raised philosophical concerns with corporate bailouts.
Tue, Aug. 2, 6:33 AM
Mon, Aug. 1, 5:30 PM
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Fri, Jul. 29, 2:03 PM
Wed, Jul. 13, 8:22 AM
- Entergy (NYSE:ETR) says it is in discussions with Exelon (NYSE:EXC) for the potential sale of its James A. FitzPatrick nuclear power plant in New York.
- ETR says it aims to complete negotiations by mid-August, and would move ahead with plans to shut and decommission the plant if no agreement is reached; ETR has said the reactor would cease operations in January 2017.
- New York recently released a proposal to provide $965M in subsidies over two years to help support struggling nuclear power plants as part of a Clean Energy Standard being considered by the state’s utility regulator; ETR says a sale depends largely on the final terms and timeliness of the Standard.
Wed, Jul. 6, 11:37 PM
- One of two nuclear reactors at Entergy's (NYSE:ETR) Indian Point power plant north of New York City shut down unexpectedly earlier today when workers tested its electrical systems.
- The Unit 2 reactor shut down automatically as it is designed to do when something unexpected occurs, but the shutdown was not intentional; ETR says it is investigating the cause.
- Unit 2 was not operating from March 7 until June 17 as part of a refueling and maintenance routine that happens every 18 months or so; it was taken offline again on June 24 for electrical testing and to repair a leaky pipe.
- Critics say the incident is evidence that the plant should be closed permanently.
- Indian Point supplies ~25% of the power used in NYC and Westchester county.
Mon, Jun. 27, 7:27 PM
- One of the biggest Brexit beneficiaries is the utilities sector, as the Dow Jones Utility Average and the SPDR Utilities Select Sector ETF both surged to new record highs as Treasury yields tumble to multiyear lows.
- The implied annual dividend yield for the Dow utilities is 3.08% and 3.18% for the utilities ETF, more than double the 10-year Treasury yield.
- J.P. Morgan equity strategists said today that they believe bond yields "are not going anywhere but lower,” and thus remain overweight on the utilities sector.
- At least six Dow utilities components posted record closes: NEE +3.3%, EIX +2.5%, AWK +2.4%, ED +1.9%, AEP +1.8%, PCG +0.8%.
- Among other major utilities in today's trade: SO +1.9%, DUK +1.9%, SCG +1.6%, ETR +1.1%, D +1%, AEE +1%, XEL +0.9%, SRE +0.9%, PEG +0.7%, FE +0.7%, EXC +0.6%.
- ETFs: XLU, UTG, IDU, VPU, GUT, BUI, FUTY, RYU, UPW, FXU, PUI, SDP, PSCU
Mon, Jun. 6, 3:22 PM
- Entergy (ETR +0.2%) is added to Goldman Sachs' Conviction List due its attractive valuation and dividend yield, which are above peer figures, as well as on low expectations heading into the company's June 9 analyst day.
- Goldman believes ETR's current share price implies either a discount on the company’s regulated segments, or limited or no value for ETR’s non-regulated, nuclear plants in New York and Michigan - an unsustainable valuation, the firm contends, given that ETR’s merchant nuclear plants generate free cash flow of $1-$2/share.
- Goldman rates ETR a Buy with an $88 price target.
- Meanwhile, the firm removes Sempra Energy (SRE -0.3%) from its Conviction List, downgrading shares to Neutral from Buy with a $108 price target as it cites earnings risks, limited near-term catalysts and valuation.
- SRE's analyst day next month may offer few new catalysts as the capital allocation plans already are disclosed, Goldman says; the key topic at the event will be potential new liquefied natural gas project announcements, which the firm "considers unlikely at this point given oversupply of LNG capacity globally."