Tags: Electric | Companies | Diversify | Maintain | Earnings

Electric Companies Diversify to Maintain Earnings

Wednesday, 20 Apr 2011 12:37 PM

In a “dual speed” global economic recovery, with some regions improving and others lagging, what does a utility have to do these days to turn a healthy profit?

Diversify. AES Corp. (AES), a Virginia-based utility, says subsidiaries in Asia and in Latin America enjoyed increased demand for electric power, which helped offset problems in the United States.

"I am very pleased that we met our full-year 2010 financial guidance across all metrics," Paul Hanrahan, AES president and chief executive officer, says in a company statement.

"Our businesses in Latin America experienced increased demand as a result of the continued regional economic recovery there, while the operational improvements we made in our generation business in the Philippines allowed us to satisfy higher demand. This helped offset the headwinds that our generation plants in North America and Hungary experienced due to fuel price pressure."

Edison International (EIX), meanwhile, says its California business unit (Southern California Edison or SCE) helped offset weaker performance at other parts of the company (known as Edison Mission Group, or EMG).

"Edison International had a solid year, led by SCE’s strong earnings growth," Theodore F. Craver, Jr., chairman and chief executive officer of Edison International, says in a company statement.

"Looking ahead to 2011, we expect continued earnings growth at SCE. EMG faces weak power market fundamentals in the year ahead, but we see positive value in the business as power market fundamentals improve.”

Edison also plans to develop a large wind farm in West Virginia that will produce 55 megawatts of electricity, enough power for over 14,000 households.

PG&E (PCG), a Northern California power producer, is working to recover from the San Bruno pipeline disaster that killed 8 people and destroyed dozens of homes in 2010.

Currently, PG&E is testing natural gas pipelines throughout Northern California to ensure safety.

Today, the company reports that net income after dividends on preferred stock was $1.10 billion for 2010, down from $1.22 billion reported in 2009. For the fourth quarter, net income was $250 million compared with $273 million in the same period of 2009.

"We are focusing the necessary resources and attention on the safety and reliability of our gas operations and improving those operations as we learn from the San Bruno tragedy," says Peter A. Darbee, Chairman, CEO, and President of PG&E.

"Our customers, shareholders, regulators, and other stakeholders have our commitment that PG&E will vigorously apply the lessons that emerge from this experience."

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In a dual speed global economic recovery, with some regions improving and others lagging, what does a utility have to do these days to turn a healthy profit? Diversify. AES Corp. (AES), a Virginia-based utility, says subsidiaries in Asia and in Latin America enjoyed...
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2011-37-20
Wednesday, 20 Apr 2011 12:37 PM
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