Tag Archives: disruptive

Southern Company missed earnings: weather and Kemper Coal and nuclear Plant Vogtle

SO CEO Tom Fanning continued to blame slow sales and earnings on mild
weather (air conditioners running less), but the big boondoggle
going bad is Kemper Coal, which has slipped six months from May 2014 to Q4 2014,
and even the Wall Street Journal calls it “possibly the most expensive fossil-fuel power plant ever built in the U.S”.
How bad will SO’s stock tank when SO’s even more expensive
nuclear Plant Vogtle slips even more?

Dividends can’t prop up SO’s share price forever, not when PSCs are revolting against the rate hikes
and guaranteed profit hikes that prop up those dividends.
When will Southern Company and Georgia Power get out front and lead in solar and wind power?
Before or after the public, state public service commissions, and investors make them do it?

Justin Loiseau wrote for DailyFinance 4 November 2013,

Southern Company Earnings: A $5 Billion Blunder? Continue reading →

Nuke overruns already causing distributed solar in south Georgia

People are tired of

irresponsible trash government at the state level
colluding with monopoly utilities to hold Georgia back in distributed
solar power, and some of us are doing something about it;
you can, too.

Jigar Shah
wrote for SaportReport 15 September 2013

Solar more viable as Georgia’s new nuclear power plants face overruns,

I am seeing Georgia’s nuclear financial woes starting to prompt a
boon for distributed energy including solar, wind, biomass,
geothermal, low-impact hydro, high efficiency cogeneration, and
other sources of electricity.

Biomass?

Let’s not go back to that carbon-polluting forest-destroying factory-exploding waste of time and resources.
Solar, wind, efficiency, and conservation are the main events, with solar increasingly leading the pack.
And those nuke cost overruns are already driving solar up even faster: Continue reading →

SO’s plan to make the Southeast a net exporter of the energy from solar and wind? –John S. Quarterman @ SO 2013-05-22

SO CEO Tom Fanning didn’t budge from nuclear and coal,
but he did announce a tiger team to get on top of
distributed solar and wind through a smart grid,
headed by SO’s COO,
at the

22 May 2013 Southern Company Stockholder Meeting.

Mr. John S. Quarterman from Lowndes County, Georgia, and he holds
220 shares of Southern Company.

TF: Hello, John. Good to see you again this year.

jsq: Hi. I’ve come to compliment Tom Fanning and Paul Bowers. Last
year, Tom Fanning was so persuasive I ran out and bought $10,000
worth of stock.

TF: Bless you.
[Applause]

However,
apparently because of

SO’s admission a few minutes before in that same meeting
that it was going to have to eat Kemper Coal cost overruns,

SO stock tanked that same day,
causing my stock to stop out,
and Standard & Poor’s downgraded SO the following day
because of Kemper Coal, noting that if the same thing happened
with SO’s nuclear project at Plant Vogtle, S&P’s would probably Continue reading →

Privatize TVA? Southern Company would like that

The hydropower assets of the Tennessee Valley Authority
would give Southern Company a way to avoid doing distributed solar for a while.
Will SO CEO Tom Fanning and Georgia Power CEO Paul Bowers
bit the bullet and go straight for distributed solar instead of
helping Duke privatize TVA for a short-term stopgap that would
set both of them farther behind the disruptive solar curve?

Blue line: SCTY; red line: SO, chart by
Google Finance.

May 16th:

Goldman Sachs invested $500 million in SCTY.

May 22nd:

SO stockholder meeting.

May 24th:

S&P downgrades SO.

Wes Patoka wrote for Motley Fool 24 May 2013,

Who Benefits the Most if the TVA Is Privatized,

Continue reading →

SolarCity disrupting utilities in Massachusetts; how about Georgia?

Why is great big Southern Company afraid of tiny SolarCity?
Look at these 2.6KW of solar panels on a house in Bedford, Massachusetts.
Think about much more sun in Georgia, financed by Google and

Goldman Sachs,
turning into
votes for solar power.
Big coal and nuclear boondoggles already

don’t look so attractive anymore to investors.

By Giles Parkinson wrote for Reneweconomy on 9 October 2012,

SolarCity’s big challenge: Prove that energy bills can fall,

SolarCity sees the traditional utilities as their biggest
competition. “We compete with them on price, predictability of
price and the ease by which customers can switch to electricity
generated by solar systems,” it says.

“We have disrupted the industry status quo by providing
renewable energy directly to customers for less than they are
currently paying for utility-generated energy. Unlike utilities, we
sell energy with a predictable cost structure that does not rely on
limited fossil fuels and is insulated from rising retail electricity
prices. As retail prices for electricity increase and distributed
solar energy costs decline, our market opportunity will grow
exponentially.”

Bloomberg New Energy Finance analyst Anthony Kim said the SolarCity
filing could be a “game-changing moment for the solar
industry” because it shows “how plummeting component
costs benefit a company operating on the downstream side of the
solar business.”

That article was posted before SolarCity’s stock went public, and
before

Goldman Sachs invested half a billion dollars in SolarCity.
Six months later, we know Southern Company and Georgia Power
are paying attention, because both SO CEO Tom Fanning and
Georgia Power CEO Paul Bowers said so at the

Southern Company stockholder meeting.

-jsq

Electric utiltiies know about Moore’s Law for solar power

And they know compound annual growth, even at a low 22% rate,
is going to cause them a heap of trouble.

More from the

Edison Electric Institute January 2013 report,

Disruptive Challenges: Financial Implications and Strategic Responses to a Changing Retail Electric Business (rehosted on the LAKE web server, since it disappered from the EEI server),

The decline in the price of PV panels from $3.80/watt in 2008 to
$0.86/watt in mid-2012¹. While some will
question the sustainability of cost-curve trends experienced, it
is expected that PV panel costs will not increase (or not increase
meaningfully) even as the current supply glut is resolved. As a result,
the all-in cost of PV solar installation approximates $5/watt, with
expectations of the cost declining further as scale is realized;

Sure, costs won’t continue to drop forever, but Continue reading →

Solar could burn utility business model

Utilities say that like it’s a bad thing.
The same utilities that

left millions without power in the U.S.

repeatedly last

year, and that

gouge ratepayers for 10% or more profits.
Moore’s Law continues

to drive solar costs down and installations up,
with increasingly more each like compound interest.
Utilties need to adapt or get out of the way.

Last November Moody’s reported that solar and wind were eroding
credit for coal and gas power plants, and were already having

‘a profound negative impact’ on the competitiveness of thermal generation companies.
That was in Europe.
David Roberts wrote for Grist yesterday,

Solar panels could destroy U.S. utilities, according to U.S. utilities,

The thing to remember is that it is in a utility’s financial
interest to generate (or buy) and deliver as much power as possible.
The higher the demand, the higher the investments, the higher the
utility shareholder profits. In short, all things being equal,
utilities want to sell more power. (All things are occasionally not
equal, but we’ll leave those complications aside for now.)

And they want to produce that power

from big baseload power stations
for their economy of scale while the monopoly power utilities
get guaranteed profits, not to mention huge ratepayer and loan-guaranteed

boondoggles like the new nukes at Plant Vogtle.
(Electric Member Cooperatives are somewhat different.)

Now, into this cozy business model enters cheap distributed solar
PV, which eats away at it like acid.