Decision Time

We are pleased to announce our Winter 2012-2013 issue of The ScottMadden Energy Industry Update. This semi-annual publication features our view of recent significant events and emerging trends in the energy industry.

The November 2012 elections did little to change the dynamics in Washington, and fiscal issues continue to dominate the national debate, as energy policy is overshadowed by—and caught in the crossfire of—dueling views on spending and taxation. Nonetheless, energy and utility companies must push forward in developing and executing their strategies, some of which were deferred pending November’s electoral outcomes. Highlights include:

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View from the Executive Suite

Energy and Utility Company Stock Prices: Some Buoyancy Despite “Cliff Diving”

While the fiscal cliff negotiations did not cause an energy and utility stock sell-off, there are mixed views on its value as an investment for those seeking income.

Also:

• Executive Summary
• Economic Outlook: Cliffs Avoided, Growth, and What It Portends for Energy and Utility Companies
• The 2012 Election: How Might the Results Impact the Energy Industry?
• Utility Investment Outlook: Analysts’ Views

Energy Supply, Demand, and Markets

Energy Efficiency: Slowing Forcing Changes to the Utility Model?

Increasing energy efficiency and conservation behavior, coupled with slow economic growth, have served to slow energy (and, in particular, electricity) consumption. This could have profound implications for the industry.

Also:

• Reduced Energy Demand: Cyclical or Secular?
• NERC’s Latest Long-Term Reliability Assessment: Some Good News and Some Cautionary Notes
• Potential Coal Plant Retirements: The Latest Tally
• U.S. Nuclear Power: Latest Developments
• Shale Gas: Risks to Bullish View
• Power Plant Replacement and Retrofit Supply Chain: Timing is Everything

The Network

Rate Case and Regulatory Activity: Grid Costs and Reliability in Focus

Recently, infrastructure investment and upgrades and storm recovery costs are colliding with declining allowed returns on equity and slower increases in demand, forcing utilities to consider different regulatory approaches.

Also:

• Electric Transmission: Some Driving and Restraining Forces
• Elements of Electric Transmission Rates and FERC’s New Incentive Rate Policy
• Gas-Power Interdependence: Implications of the “Dash to Gas”
• Gas-Power Interdependence: Regional Differences Mean Different Concerns

Renewables, Clean Tech, and Energy Technologies

Wind O&M Costs: Increasing Focus But Costs Remain Low

The wind industry is beginning to make the transition from high growth to maturity. As the wind fleet ages, wind generation owners and operators are turning their attention to operating, maintenance, and capital expenditure strategies.

Also:

• Curtain Calls for the Production Tax Credit and Shifting Paradigm for Wind Development?
• Absent Delays, State Renewables Portfolio Standards Should Support Some Renewables Development

We hope you will find The ScottMadden Energy Industry Update a useful and informative resource. If you would like to discuss our observations in greater detail or have us present them or our views on other industry or management issues to your executive team, please contact us. View our Energy Practice area.

This semi-annual publication features our view of recent significant events and emerging trends in the energy industry.