As Power Markets Improve, NRG Energy Can Better Leverage Its Assets
Stephen Simpson, CFA
Stephen Simpson, CFA
Wed, Jul. 13, 8:02 AM
Thu, Jun. 9, 12:29 PM
- NRG Energy (NRG -7.5%) is downgraded to Sell from Buy with a $16 price target at UBS, which says the stock's risk and reward "skews negatively" following the near doubling off January lows.
- "NRG and peers have rallied as part of a bullish gas thesis, but we think the market is overlooking the $285M decrease in PJM capacity revenue and the potential for continued weakness in PJM, which represents 33% of capacity,” UBS writes.
- Despite NRG’s strong performance YTD, 2019 ATC power prices are roughly flat in its core markets and the recent PJM capacity auction came in solidly below expectations, and UBS notes that PJM deterioration is particularly negative for NRG as it looks to negotiate with creditors of its GenOn subsidiary.
Tue, May 24, 5:58 PM
- NRG Energy (NYSE:NRG), Dynegy (NYSE:DYN) and FirstEnergy (NYSE:FE) are lower AH by -3%, -1.5% and -0.3% respectively following the results of PJM Interconnection's latest auction.
- PJM says its "second auction with stringent pay-for-performance standards attracted a significant amount of new resources at competitive prices to the PJM footprint," as it procured ~167.3K MW in the auction to ensure electricity capacity for the June 2019-May 2020 delivery year; the clearing price was $100/MW-day for the majority of the 13-state PJM region vs. the $164.77 rate set during last year's auction.
- Prices were lower than some analysts had expected and lower than last year's auction results due to market fundamentals of changes in supply and demand, PJM says.
Fri, May 20, 10:17 AM
- A small fire shut down a generating tower at NRG Energy's (NRG +0.8%) Ivanpah Solar Electric Generating System in California, leaving the facility operating at only a third of its capacity.
- The plant works by using mirrors to focus sunlight on boilers at the top of three 459-ft. towers, creating steam that drive turbines to produce electricity, but fire officials say some misaligned mirrors instead focused sunbeams on a different level of Unit 3, causing electrical cables to catch fire.
- Ivanpah is the world’s largest solar power plant and can produce enough power for 140K California homes, but a second tower is shut down for maintenance, leaving only one running; the potential impact on California's electricity supply is not yet clear.
Fri, May 6, 12:21 PM
- NRG Energy (NRG +3.5%) is higher for a second straight day after reporting stronger than expected Q1 earnings and revealing plans to trim involvement in two of its alternative energy ventures as it seeks to cut costs and streamline operations.
- NRG says it will sell a majority stake in its EVgo electric vehicle charging business, and its home solar division will sell the future customer agreements it originates to two partners, Sunrun (NASDAQ:RUN) and Spruce, once the systems are up and running.
- The approach will allow the residential solar business to break even by next year, NRG CEO Mauricio Gutierrez said in yesterday's earnings conference call.
- The CEO said the home solar unit will for now focus on three markets where it is already active - New York, New Jersey and Massachusetts - but will look to offer rooftop arrays to the residential customers it serves in Texas when the economics are more viable.
- Now read NRG Energy is a unique company offering both a high yield and growth
Thu, May 5, 9:14 AM
- NRG Yield (NYSE:NYLD) appoints Christopher Sotos as its new President and CEO, replacing interim President and CEO Mauricio Gutierrez.
- Sotos previously served as Head of Strategy and Mergers & Acquisitions at NRG Energy (NYSE:NRG); he joined NRG in 2004.
- NYLD also announced Q1 earnings that came in below analyst estimates, increased its quarterly stock dividend to $0.23/share, and reiterated its target of a $0.25/share dividend ($1.00 annualized) by Q4.
Thu, May 5, 6:53 AM
Wed, May 4, 5:30 PM
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Mon, Apr. 18, 7:44 AM
Tue, Apr. 5, 6:58 PM
- The utilities sector (NYSEARCA:XLU) fell twice as hard as the overall S&P in today's trade, and the best guess from Barron's Ben Levisohn in explaining the move is a NYC rate change instituted by New York Independent System Operators.
- UBS analysts say NYISO's summer 2016 capacity prices declined substantially in the NYC Zone-J to $10.99/KW-month from $15.50/KW-month, which the firm attributes primarily to the latest parameters which showed a substantial reduction of in-city requirements; the wider regions continued to clear at relatively comparable levels.
- UBS sees the results as supportive of upstate generators Dynegy (NYSE:DYN) and Talen Energy (NYSE:TLN), but more cautious for NRG Energy (NYSE:NRG) due to the fickle nature of highly-sensitive NYC capacity prices.
- Now read Electric utilities: Powerful uptrend, or 'lights out' for the stocks?
Wed, Mar. 23, 3:39 PM
- TransCanada (TRP -0.5%) is working with JPMorgan Chase to find buyers for more than $7B in assets to help finance its acquisition of Columbia Pipeline Group (CPGX +0.1%), Bloomberg reports.
- Assets reportedly for sale include a portfolio of U.S. Northeast merchant power plants, including the Ironwood natural gas power plant in Pennsylvania, the Ravenswood gas- and oil-fired generation plant in New York, hydroelectric power assets in New England, the Kibby wind power operation in Maine, and Ocean State Power gas generation facilities in Rhode Island; a minority stake in TRP’s Mexican natural gas pipeline business also is up for sale.
- The power plants could attract interest from P-E investors such as Blackstone, D.E. Shaw, Macquarie and Riverstone Holdings, as well as strategic peers including Calpine (CPN -2.8%) and NRG Energy (NRG -5.7%), Morningstar's Travis Miller says.
Thu, Mar. 17, 4:37 PM
- California regulators award more time for the struggling Ivanpah solar plant to generate the electricity it is required to produce under contracts with PG&E (NYSE:PCG).
- The California Public Utilities Commission today approved without discussion forbearance agreements that would give the owners of the plant, NRG Energy (NYSE:NRG), BrightSource Energy and Alphabet's Google, up to a year to work out the problems.
- PG&E’s California utility had asked the PUC to approve the agreements, saying the plant otherwise would be in danger of shutting down if it failed to meet contractual requirements.
- The plant, located ~50 miles southwest of Las Vegas in California’s Mojave Desert, cost ~$2.2B and received ~$1.5B in federal loans.
Thu, Mar. 17, 10:17 AM
- PG&E (PCG +0.4%) says the U.S.-backed $2.2B Ivanpah solar project in California may have to shut down if it does not receive a break from state regulators, because it is not producing the electricity it is contractually required to deliver.
- The unconventional solar-thermal project - owned by NRG Energy (NRG +0.7%), BrightSource Energy and Alphabet's Google, and financed with $1.5B in federal loans - so far has failed to produce the expected power.
- PG&E wants permission from the California Public Utilities Commission to overlook the shortfall and give Ivanpah another year to sort out its problems, warning that allowing its power contracts to default could force the facility to shut down.
- The extension request is opposed by some consumer groups, who say the cost of the electricity from the struggling plant is exorbitant.
Mon, Feb. 29, 9:19 AM
- NRG Energy (NYSE:NRG) -4.2% premarket after reporting a Q4 loss and announcing a 79% cut in its annual dividend to $0.12/share from $0.58, which it says will provide the company with an extra $145M/year.
- NRG's Q4 loss totaled $6.4B, primarily from writedowns including the loss of value of its struggling Texas coal plants; Q4 EBITDA fell 5.4% Y/Y to $625M, which NRG says shows it is still operating very efficiently.
- NRG says it is reincorporating its NRG Renew solar business for commercial and industrial customers back into NRG, but still plans to spin off or sell much of its stake in its home solar and electric vehicle charging businesses in the spring as previously planned.
Mon, Feb. 29, 6:37 AM
Sun, Feb. 28, 5:30 PM
NRG Energy, Inc. is an energy company. The company produces, sells and delivers energy products and services in competitive power markets in the U.S. Its wholesale operations include plant operations, commercial operations, EPC, energy services and other critical related functions. The Company's... More
Industry: Electric Utilities
Country: United States
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