This Week in Utilities: New Natural Gas and America's Dirtiest Power Plant

Utilities were busy last week, making moves to maximize profit potential. With new natural gas exports, America's dirtiest power plant, and more, here's what you need to know to stay on top of your dividend stocks' latest moves.

Dominion's dominating
Dominion (NYSE: D  ) got the government's go-ahead to export LNG (liquefied natural gas) to non-Free Trade Agreement countries. The company is only the fourth to receive such an approval, and the thumbs-up paves the way for massive markets abroad.

Dominion's $3.6 billion Cove Point plant has been exporting LNG to Free Trade countries since 2011, but India and Japan companies are now jumping on board with 20-year terminal service agreements. The approval was expected by most, but shares have still managed around 4.5% gains since the announcement .

Source: Dominion

Can Exelon excel?
Barclays held its CEO Energy Conference last week, and Exelon's (NYSE: EXC  ) Chris Cane is singing a new tune. While his company lays claim to a whopping 20% of all nuclear capacity in the United States, Exelon will focus more on its regulated division over the next few years.

Despite rising prices, natural gas has been crushing nuclear, and volatile markets have left the utility yearning for stable sales. The company plans to invest $13.5 billion into its three regulated utilities over the next two years, and will request concurrent rate base growth rates of 5% to 6% annually.

Exelon has had mixed success with regulators, and a fuller focus on friendly policy and higher return-on-equity rates may pay off for this company.

New rates for Duke
Duke Energy (NYSE: DUK  ) secured $119 million more from South Carolina regulators this past week. The utility was approved for a two-year plan that will push rates around 8.2% higher for South Carolina customers, equating to a 10.2% return on equity. That's significantly higher than Exelon subsidiaries ComEd's 8.5% and BGE's 7.5%, but shy of Exelon PECO's 12 %.

Generally speaking, a ROE of 10% or higher is good ground for a utility, and this latest approval should go down as a nice little win for Duke Energy investors .

Polluting power plants
The news wasn't all good this past week. Non-profit Environment America Center released a report outlining America's 100 dirtiest power plants, and the center crowned Southern Company (NYSE: SO  ) the king of carbon.

Southern took silver and gold for two Alabama and Georgia plants, although NextEra Energy should share some blame with 76% ownership of one of four units in the most polluting plant.

While bigger power facilities almost inherently produce more energy, carbon emissions pose local and global issues, and the companies at the top of this list could see severe costs if policies push them to clean up their act .

Stay current on electricity
From new LNG exports to old polluting plants, the world of utilities is changing fast, and dividend stocks aren't the stable stalwarts they once were. Be sure to check back weekly for the latest on your portfolio's moves, and you'll be well on your way to electrifying earnings.

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Related Tickers

9/27/2016 4:01 PM
D $75.78 Down -0.82 -1.07%
Dominion Resources CAPS Rating: ***
DUK $81.43 Down -0.72 -0.88%
Duke Energy CAPS Rating: ***
EXC $34.18 Down -0.64 -1.84%
Exelon CAPS Rating: ****
SO $52.84 Down -0.47 -0.88%
Southern Company CAPS Rating: ***