Batteries hasten winds of change for electricity stocks

Monday, June 11, 2018
(Photo: Eric Haun)

Bigger, better batteries are speeding up change in the U.S. electricity sector and could help power a rally in Xcel Energy Inc, American Electric Power Co Inc and other utility and renewable energy stocks, Barron's reported.

After a decade of steep cost declines, wind and solar installations, often paired with battery storage, are increasingly displacing older coal and gas-fired power plants, benefiting battery makers and some utilities, the Barron's cover story said.

Batteries can now store enough electricity to help power small towns when wind and solar supplies ebb, Barron's said. The United States is expected to install more than 35 megawatts of battery storage through 2025, which could save more than $4 billion in annual operating costs, Barron's said, citing the Washington-based Energy Storage Association trade group.

Minneapolis-based Xcel plans to draw 45 percent of its power from renewables by 2027, up from 23 percent currently. While the stock is down 11 percent this year, its performance has beaten the S&P 500 Index over the past 10 years, Barron's said.

American Electric is reducing its reliance on coal and holding gas generation steady, while ramping up wind and solar, in part through the $4.5 billion Wind Catcher project in Oklahoma, which claims to be the largest U.S. wind farm, Barron's said. The Columbus, Ohio-based company aims for low double-digit stock returns, Barron's said.

The paper also said NextEra Energy Inc, of Juno Beach, Florida, was combining 100 megawatts of solar capacity with 30 megawatts of battery storage at a project in Arizona.

Investing in battery makers directly is complicated, since Panasonic Corp, Tesla Inc and other big makers come with a range of revenue streams.

Utility stocks are under pressure as rising bond yields steal some of the appeal of dividend yields. But the outlook is improving for many companies in the Utilities Select Sector , Barron's said.

Reuters recently reported that a growing number of U.S. utilities are shutting fossil-fuel plants and have no plans to build combined-cycle natural gas power stations, because renewables are so much less expensive, posing problems for power plant makers such as General Electric Co . 


(Reporting by Alwyn Scott; Editing by Peter Cooney)

Categories: Renewable Energy Energy Wind Power

Related Stories

China Starts Production at Major Oil Field in Bohai Sea

China Starts Production at Major Oil Field in Bohai Sea

CNOOC Finds Oil and Gas in South China Sea

CNOOC Finds Oil and Gas in South China Sea

Seatrium Makes First Turnkey FPSO Delivery to Petrobras

Seatrium Makes First Turnkey FPSO Delivery to Petrobras

EnQuest Acquires Harbour Energy’s Vietnamese Assets

EnQuest Acquires Harbour Energy’s Vietnamese Assets

Valeura Makes Progress with Multi-Well Drilling Campaign in Gulf of Thailand

One Shelf Drilling Rig Up for New Job in India, Other for Disposal

Yinson Production Secures $1.17B Refinancing for FPSO Maria Quitéria

CNOOC Signs Hydrocarbons Exploration and Production Deal with Kazakhstan

CIP, ACEN Partner Up for First Large-Scale Offshore Wind Farm in Philippines

Woodside to Shed Some Trinidad and Tobago Assets for $206M

Current News

Pandion Energy Divests Interests in Three Norwegian Assets to Inpex

China Starts Production at Major Oil Field in Bohai Sea

Dutch Contractor Completes Malaysia’s Largest 'Rig-to-Reef' Decom Project

China Rolls Out 17MW Floating Wind Turbine Prototype

SBM Offshore’s Jaguar FPSO Enters Drydock in Singapore (Video)

EnQuest Picks Up Offshore Oil and Gas Block in Brunei

CNOOC Finds Oil and Gas in South China Sea

Seatrium Makes First Turnkey FPSO Delivery to Petrobras

KBR-SOCAR Joint Venture Secures Work for BP in Azerbaijan

Baker Hughes, Petronas Team Up for Asia-Pacific Energy Resilience

photo

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com