FirstEnergy Corp. (FE), American Electric Power Company Inc (AEP) – This Week in Utilities: The End of Coal and More Natural Gas

Page 1 of 2

Utilities have been busy this week, making moves to maximize profit potential. With new coal closings and fresh starts into natural gas, here’s what you need to know to stay on top of your dividend stocks’ latest moves.

FirstEnergy Corp. (NYSE:FE) is out 2,080 MW

FirstEnergy Corp. (NYSE:FE)
FirstEnergy Corp. (NYSE:FE) announced earlier this week that it plans to close down two Pennsylvania coal-fired power plants by the end of October, knocking 2,080 MW off its total generation capacity.

In its press release, the company noted that a combination of cheap electricity and costly environmental regulations tipped the scales on coal’s cost-competitiveness for these two plants. FirstEnergy Corp. (NYSE:FE) estimated that while the plants’ generation amounts to around 10% of total capacity, the plants’ environmental compliance costs would’ve accounted for around 30% ($280 million) of the company’s total spending.

Along with nine other plants already on the deactivation list, FirstEnergy Corp. (NYSE:FE) notes that “nearly 100 percent” of its electricity will now come from low- or non-carbon-emitting sources.

AEP is out 585 MW

American Electric Power Company Inc (NYSE:AEP) followed in FirstEnergy’s footsteps two days later, when it announced the expected closure of a 585 MW Ohio coal-fired power plant. For the utility’s American Electric Power Company Inc (NYSE:AEP) Ohio subsidiary, this latest announcements brings its grand total to 3,123 MW of coal-fueled generation to be retired by 2016.

Just like FirstEnergy Corp. (NYSE:FE), American Electric Power Company Inc (NYSE:AEP) pointed the finger at environmental regulation as a main driver behind its ultimate decision. But unlike FirstEnergy Corp. (NYSE:FE)’s focus on cheap electricity prices, American Electric Power Company Inc (NYSE:AEP) kept its other reason generalized as “current market conditions.” And while it expects to fully retire the plant, American Electric Power Company Inc (NYSE:AEP) did mention the possibility of a natural gas refuel.

Although the expected closure won’t affect the utility’s 2013 operating earnings, the company is taking a $150 million to $170 million non-operating pre-tax impairment charge for Q2 to account for the decision

Natural gas notions
American Electric Power Company Inc (NYSE:AEP) isn’t alone in considering natural gas options over coal. TECO Energy, Inc. (NYSE:TE), one of the most coal-centric utilities around, took another step this week toward ramping up its natural gas investments.

After announcing in May that it would spend $950 million to buy out regulated New Mexico Gas Co. from Continental Energy Systems, TECO Energy, Inc. (NYSE:TE) officially filed its acquisition approval application with state regulators this week.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!