With all of the hot air we've seen expended over the last 2+ years, mostly in that non-state wedged between Virginia and Maryland, I for one have wondered if there was a way to harness that energy and possibly end this whole "dependence on foreign" oil problem.
Warren Buffett, a man who has demonstrated he knows how to put his money where his mouth is, is complimenting his "green bet" on trains with Mid-American Energy Holdings which recently won approval for a $2BN wind farm from an Iowa utility.
The 400-600 turbines will double the company's wind capacity in the state. "In Iowa, there was wind but nothing to harness it 10 years ago", WB said recently. Funny, there's been wind in D.C. for over 200 years and the only thing they seem to harness is your paycheck.
Roscoe, Texas, a town with just 17,000 people or 5.52E-05% of the U.S. population has over 10% of the nations wind-power generating capacity and the 100,000 acre project has "helped the city kind of reinvent itself" said Cody Thompson, the city manager. Greg Wortham, the mayor of the county seat city of Sweetwater said that 20% of Nolan County's jobs are wind-power related which is as many as the fossil fuel industry employs in the area.
Our favorite trade-war partner, China, is also a big proponent of using the wind to generate energy and has set a goal of using renewable sources for 15% of its energy by 2020. Pragmatists that they are, however, the Chinese supplement their wind farms with coal fired power plants as the wind there does not blow as steady as it does in Iowa, Texas or D.C. for that matter.
A-PowerEnergyGenerationSystems Ltd., had recently signed a deal to be the exclusive supplier of 240 2.5 megawatt wind turbines to U.S. Renewable Energy Group a P/E firm that is lead partner on a 36,000 acre West Texas wind energy development. The twist here is that A-Power is headquartered in Shenyang, China.
In this country General Electric (GE) manufactures wind turbines and FPL Group (FPL) and Alliant Energy Corp (LNT) are two utilities that sell wind-generated electricity to their customers.
A look at GE's CDS/equity combo is still pretty much a look at GECC the company's once shining star financing sub turned shell shocked zombie so there is not a lot of information to be gleaned from the exercise.
LNT's CDS/equity combo spent the first part of the year moving in a way that was negative for the stock holders and then from March until late September, positive. Since then the CDS really hasn't moved off its lows but the stock has had a few brown-outs. The CDS closed last night at 46bps and the stock closed at $27.77. The high close for the stock was reached on 2/5 at $29.73 and a more recent price of $28.60 was posted on 9/28.
The CDS information for FPL is captured under the FPL Group Capital Inc. entity. Here we see a slow, steady decline of CDS levels throughout the year with the low being reached on 9/17 at 55bps. The stock price action looks very similar to LNT falling until March and then rising through late July. The move lower since, however, is more pronounced for FPL than LNT having touched $49.04 on 11/2 before closing last night at $50.61.
Enjoy the week.
