Exelon stock slammed on deteriorating revenue outlook
Tesla Now Worth 25% Of GM, But Just Wait a Few Hours….
May 30, 2013 Zachary Shahan
Tesla’s stock has been climbing strong, and I’m feeling mighty angry at myself, since I was planning to buy some a couple months ago… but never did. At the moment, Tesla’s stock price is over $104, and the good folks over at Venture Beat have noted that Tesla’s now worth about 25% of GM.
It’s interesting, actually, because Chrysalix President and CEO Wal van Lierop, while interviewed by Future360 TV a couple months ago, said that the US has three and a quarter automotive companies, if you count Tesla as one quarter.
From Venture Beat’s John Koetsier: “So now, with a market cap in excess of $12 billion, Tesla is worth almost a quarter of the venerable General Motors.” Here’s a graph of Tesla’s stock price since March 1:
There are a ton of reasons why Tesla’s stock has been surging. I ran down many of them in my Top 33 EV Stories Of 2013 (So Far) article, so I’ll just repost some of those below. But first, there’s one more big piece of news today. Tesla is holding a press conference later today in which CEO Elon Musk has said he will announce a tripling of Tesla Superchargers. That’s the rumor, at least. The Superchargers, which are solar powered, are free for use by Tesla owners. They charge your car relatively quickly, and their purpose is to make long-distance trips along the East and West Coast (and maybe soon in other regions) relatively easy for a Tesla owner. We’ll keep you posted.
Prior to today, from my Top 33 EV Stories article, these are some of the things that have resulted in Tesla’s stock surge:
6. Tesla Announces One Huge Improvement Or Milestone After Another.
Elon Musk, Tesla’s founder and CEO, seems to be genuinely intent on helping humans and helping humanity. He and the Tesla team have announced that they will cover everything that might happen to a Model S owner’s car… beyond a physical accident or
Steve DanielsMay 28, 2013
Exelon Corp.'s stock plummeted more than 7 percent on a day that the broader markets soared, due to a surprise revenue blow the Chicago-based power generator will suffer three years from now.
PJM Interconnection, the operator of the regional power grid that includes most of Exelon's power plants, including all of its industry-leading nuclear plants, announced results late Friday of an auction for the year beginning June 1, 2016, to reserve capacity at plants in PJM. The clearing price in the western half of the region, which includes Chicago, was just $59.37 per megawatt-day, about half of what analysts were forecasting and less than half of the $136 per megawatt-day set in a previously held auction for 2015-16.
For Exelon, that means capacity revenue will fall about 41 percent in the year beginning June 1, 2016, to $847 million from about $1.4 billion the previous year, according to a report today by UBS Securities LLC in New York.
Generators like Exelon get paid both for reserving power for future delivery and when the electricity actually is delivered. The price paid for reserving the power is set three years ahead of time in a yearly auction conducted by PJM, which oversees the grid in a territory running across all or parts of 13 states, from Chicago east to North Carolina. The capacity payments are a significant part of generators' revenue, and have become more so as wholesale energy prices have fallen.
Exelon's stock closed down $2.61 per share, or 7.5 percent, to $32.04.
UBS analyst Julien Dumoulin-Smith pegged Exelon as being “particularly exposed” to the lower-than-expected capacity pricing.
Exelon sliced its dividend 41 percent earlier this year as its revenue outlook continued to lag.
“We expect the latest reduction in capacity payments to drive a further reassessment of prudent balance sheet...
NV Energy to Join MidAmerican Energy Holdings Company
Updated May 29, 2013, 10:28 a.m. ET
DALLAS — The CEO of Exxon Mobil Corp. says there's no quick replacement for oil, and sharply cutting oil's use to reduce greenhouse gas emissions would make it harder to lift 2 billion people out of poverty.
"What good is it to save the planet if humanity suffers?" CEO Rex Tillerson said at the oil giant's annual meeting Wednesday.
Tillerson jousted with environmental activists who proposed that the company set goals to reduce emissions from its products and operations.
Shareholders sided with the company and voted nearly 3-to-1 to reject the proposal.
By a 4-to-1 ratio, shareholders defeated a resolution to explicitly ban discrimination against gays. The Exxon board had argued that the company already banned discrimination of any type and didn't need to add language regarding gays.
It was the 16th defeat for Exxon resolutions on discrimination against gays and the seventh on greenhouse emissions.
Since Tillerson replaced Lee Raymond as CEO in 2006, Exxon has softened the tone of its public comments but not its skepticism about climate change. Tillerson said that in the past decade the average temperature "hasn't really changed," and he repeated his optimism that technology will solve the problem.
The average global temperature rose one quarter of a degree Fahrenheit from the 10 years that ended in 2002 to the decade that ended in 2012, according to the National Oceanic and Atmospheric Administration. However, the decade of 2000-2009 was the hottest on record, and nine of the 10 hottest years have occurred since 2001.
Activists argued that climate change will result in more severe weather. Patricia Daley, a member of the New Jersey-based group of Dominican nuns that proposed the climate-change resolution, cited last year's East Coast hurricane.
"I had to evacuate a lot of old nuns because of Superstorm Sandy," Daley said. She
May 30, 2013 at 6:46 am by Bloomberg
Growth prospects for smaller oil-sands producers including BlackPearl Resources Inc. (PXX) and Southern Pacific Resource Corp. (STP) are fading as political wrangling over the Keystone XL pipeline and rising U.S. supply slow deals in the Canadian energy industry.
The inability of firms such as Marathon Oil Corp. (MRO), ConocoPhillips (COP), and Koch Industries Inc. to sell assets recently highlights waning investor interest in Alberta’s oil sands, dragging down shares of smaller producers, said Mike Dunn, an analyst with FirstEnergy Capital Corp. in Calgary.
Smaller companies are especially vulnerable to slowing deal-making because their valuations are based in part on the chance that they will be bought, said Mason Granger, a portfolio manager at Sentry Investments Inc. in Toronto. The Keystone XL delay makes it more difficult for them to raise money for financing to grow and maybe ultimately to survive, Granger said.
“Oil sands is just such a tough space to be in — it really requires the balance sheet of the super majors to make a success,” Granger, who manages C$400 million ($386 million) in energy sector investments, said in a May 24 telephone interview. “The landscape of junior oil-sands companies is littered with spectacular failures.”
John Festival, chief executive officer at BlackPearl, didn’t return messages seeking comment on funding after saying in a May 8 earnings release the company was working on a financing plan. Greg Foofat, a Southern Pacific spokesman, said the company has received a boost to its revolving credit facility to fund operations.
Competition from rising U.S. energy supplies, a dearth of capacity to ship crude out of landlocked Alberta and political deliberations around pipelines have pushed oil from Canada, home to the world’s third-largest reserves, swinging to as much as $41.50 a
May 30, 2013 at 6:37 am by Associated Press
VIENNA — Once the symbol of oil dominance, OPEC faces new challenges as its members gather for a ministerial meeting this week on how much crude to pump.
For the 12 oil ministers from countries ranging from Venezuela to Nigeria and Iran, the formal focus of Friday’s get-together is to determine production levels. The consensus in the markets is that ministers will opt to maintain the status quo as prices for U.S. benchmark oil have traded in a narrow range a few dollars above $90 a barrel. Brent crude, the reference point for many international oil varieties, is just above the $100 mark some countries OPEC exporters consider the acceptable minimum.
With prices largely at acceptable levels, the ministers are expected to maintain the cartel’s target at 30 million barrels a day. However, there may be an attempt to cut back on overproduction, now said to be running at nearly 500,000 barrels a day.
On his arrival in Vienna on Tuesday, Saudi Oil Minister Ali Naimi described the status quo as “the best environment for the market.”
For analysts at Commerzbank in Frankfurt, that was a clear signal there would be little or no change in policy — the Saudis are the main driver of OPEC policy. As such, said a Commerzbank note, it is “unlikely that Friday’s OPEC meeting will result in any change to production policy.”
Beyond prices and output, though, the Organization of the Petroleum Exporting Countries faces other more complex issues, ranging from the ramp up in shale oil production in the U.S. and a potentially destabilizing spat between Saudi Arabia and Iran.
The rise in shale oil production in the U.S., the world’s biggest economy, has an impact on OPEC as the country remains a main market for OPEC. Shale oil, which is extracted from rocks using heat, helped lift the U.S.’s total output up to a daily 7.4 million barrels per day this month.
China to Release About 40% More Carbon Dioxide by 2020, EIU Says
By Chisaki Watanabe - May 29, 2013 11:53 PM MT.
[color=#FF0000][b]China’s carbon dioxide emissions will rise about 40 percent more by 2020[/b][/color] by burning fuel compared with levels in 2010 when it was already the biggest emitter, the Economist Intelligence Unit said today in a report.
The projection came as the Economist estimated China’s consumption of coal will grow by 18 percent during 2011-15, down from 46 percent growth in 2006-10. Coal accounts for about two-thirds of China’s energy consumption and three-quarters of its power generation, it said.
Measures such as a carbon tax and carbon trading, coupled with carbon capture and storage techniques, will be needed to contain emissions quickly, the Economist said.
May 29, 2013 at 1:46 pm by Zain Shauk
DALLAS – Exxon Mobil Corp. underestimated the drag that low natural gas prices would have on its earnings, even as it raked in its second-highest profit total ever, CEO Rex Tillerson said Wednesday.
Speaking to shareholders at Exxon Mobil’s annual meeting, Tillerson faced questions on the company’s growth and repeated inquiries about climate change, a subject on which Tillerson spoke at length.
Tillerson said the company’s record spending on acquisitions and new developments was part of a growth strategy that has not yet delivered substantial returns — partly because of low natural gas prices.
When Exxon Mobil purchased natural gas producer XTO Energy for $25 billion in 2010, “we expected natural gas prices had not yet bottomed out,” Tillerson said. “They bottomed out, but they stayed low much longer than we expected.”
A poor economic climate and extensive domestic supplies of natural gas led to the sustained low U.S. prices, he said.
“We weren’t a very good predictor on how quickly the U.S. economy was going to rebound and we missed slightly the industry’s pent up capacity,” Tillerson said.
“For the near term, I would say maybe we were off a year or two in an acquisition merger that was undertaken because of the 30-40 year view of the value,” he added. “I’m not too concerned about that.”
Still, Exxon Mobil’s 2012 profit of $44.9 billion was the second-highest in its history, even as the company has invested huge amounts of money in projects that have not yet delivered returns.
Exxon Mobil, the world’s second-most valuable public company after Apple, plans to spend $38 billion a year on new projects. These include expanding Canadian oil sands efforts, starting up a massive liquefied gas effort in Papua New Guinea, and exploring in an area of Russia’s Arctic region larger than Texas.
Shareholders at the meeting at the Morton H...
Former Miss America unhappy with GOP attack
By The Associated Press
Posted May 29, 2013 at 11:30 a.m.
FRANKFORT, Ky. — Former Miss America Heather French Henry has voiced her displeasure with a GOP statement calling her a "bottom-of-the-barrel pick" to run for U.S. Senate against Republican Mitch McConnell.
French Henry said in a blog post on Wednesday that she'll make a decision on the race soon.
Republican Party of Kentucky spokeswoman Kelsey Cooper made the statement about French Henry last week when she announced that she is considering taking on McConnell.
French Henry likened the behavior of politicians to children, and said they need to get "a real time-out."
Several Democrats have been mulling a run against McConnell, including Secretary of State Alison Lundergan Grimes and former Democratic Party Chairman Bill Garmer.
Actress Ashley Judd, a former Kentucky resident, had considered a run, but decided earlier this year against it.
Free ethanol offered Wednesday at Arco AM/PM off CR-102 in Woodland
Holly Jessen | May 29, 2013
The Iowa Renewable Fuels Association is pointing to examples of ethanol plants that sell E85 directly to retailers. Contrary to the claims of the petroleum industry renewable identification numbers (RINs) are being used to lower fuel prices for consumers, the IRFA said.
“Big Oil consistently touts the line that buying RINs equates to higher gas prices, but reality proves otherwise,” said IRFA Executive Director Monte Shaw. “The blender – the seller of the RIN – can and should pass the value of the RIN through to consumers. In fact, Iowa ethanol plants are doing just that. By offering higher blends like E85 directly to retailers, Iowa ethanol plants are passing along the RIN savings and hoping that retailers will reflect the lower wholesale prices at the pump.”
IRFA named two ethanol plants that offer E85 directly to retailers, Siouxland Energy and Livestock Cooperative, a 60 MMgy ethanol plant in Sioux Center, Iowa, and Absolute Energy, a 115 MMgy ethanol plant near the Iowa-Minnesota border. The two facilities announced implementation of the direct-to-retailers programs on May 24 and May 29.
Recent OPIS prices for E85 at Iowa terminals were $2.69 a gallon, IRFA pointed out, while at the same time SELC listed its E85 at $2.17 a gallon. “Here at Siouxland Energy, we’re passing on the RIN savings to the consumer, and it’s making for some very attractive E85 prices,” said Tom Miller, SELC commodity manager. “I think ethanol plants are growing tired of watching a middleman pocket the RIN value to the detriment of consumers. Our plant wants consumers to understand the real value of homegrown ethanol, so we’ve cut out the middleman and we’re selling E85 directly to retailers at a much greater discount.”
RINs are earned by ethanol blenders and can then be sold on the open market to oil refiners, which use the credits to demonstrate...
Ben Geman - 05/29/13 01:53 PM ET
The Interior Department is taking steps toward implementing its years-long plan to create an “Ocean Energy Safety Institute,” which officials say will provide an independent forum for collaboration and research to improve offshore drilling safety.
It’s one of several initiatives since the 2010 BP oil spill that lead to the overhaul of the department’s long-troubled offshore branch and tougher regulations.
Interior’s Bureau of Safety and Environmental Enforcement (BSEE) on Wednesday published a solicitation for applications to manage the proposed institute, which Interior has been planning since 2010.
“The Institute will help federal regulators keep pace with new processes employed by the industry as they move into deeper water and deeper geologic plays that require technological innovation to bring projects into production," BSEE Director James Watson said.
The agency is committing $5 million over five years for operating the institute.
It’s missions include R&D, training federal workers in identifying the safest technologies, and implementing improvements in environmental protection and safety, containing blowouts and spill response, according to the solicitation for applications.
The institute is envisioned as a place for collaboration among academics, industry, the government and others, and will be “an important source of unbiased, independent information and will not have any regulatory authority over the offshore industry,” BSEE said Wednesday.
Creation of the institute stems from a recommendation of the Ocean Energy Safety Advisory Committee (OESC), a federal advisory panel created after the 2010 BP disaster that dumped several million barrels of oil into the Gulf of Mexico.
“While there have been other efforts to identify technological gaps and to recommend improvement of drilling and production equipment,
May 28, 2013, 6:10 p.m. ET
By RYAN TRACY
Some of the largest U.S. users of coal are thinking about getting into the solar-power business.
Executives at utilities American Electric Power Co. AEP -0.84% and Southern Co., SO -1.58% seeing a potential threat to their business model on the horizon, are pondering how and when they might enter the market for installing solar panels at businesses and homes. Until now, that kind of "distributed" solar—as opposed to large-scale solar arrays—has mostly been the domain of newer companies like rooftop-solar-panel installer SolarCity
"On its face you would look at it and say distributed generation is a threat," said Nick Akins, chief executive of American Electric Power, in an interview. "But on the other hand we see it as an opportunity because our business is changing. There's no getting around it."
A growing number of businesses and other building owners are interested in adding solar power to their roofs but often don't have the funds. Some startups are financing installation and recouping the costs through long-term, solar-power-payment agreements with building or home owners. Utilities can make money that way, or they can simply rent the rooftop from the owner and take all the power for the grid, hoping the solar energy generated will save costs elsewhere.
The utilities haven't invested in any small-scale solar plants yet and might decide against it. They are testing the waters now in part because they are feeling a pinch: Demand for electricity is barely growing in the sluggish economy, and developers of small-scale solar systems are giving customers another option for buying power. SolarCity this month announced $500 million in new funding for solar projects from Goldman Sachs Group Inc. GS +1.87%
The companies' turn toward solar power is more striking because of skepticism in Washington after the failed federal loans to panel maker
Shareholder support for Exxon executive pay erodes
By Anna Driver
DALLAS | Wed May 29, 2013 1:11pm EDT
May 29 (Reuters) - Fewer shareholders of Exxon Mobil Corp on Wednesday cast votes in favor of the oil company's executive compensation following a year when Chief Executive Officer Rex Tillerson's total pay climbed 15 percent to about $40 million.
Proxy advisory firm ISS had recommended that shareholders withhold support for CEO Tillerson's compensation, citing Exxon's "modest" shareholder returns and the company's reliance on awards that have less emphasis on performance.
This year at the company's annual meeting, 71 percent of Exxon's shareholders cast a non binding vote supporting the compensation of the company's named executives, compared with 78 percent last year. The average support for so-called say-on-pay results was 91 percent in 2012, according to ISS.
Tillerson told reporters after the meeting that the decline in support for his pay "wasn't a significant move" and meant that 70 percent of Exxon's shareholders were happy with the company's compensation practices.
Exxon's total shareholder return - or capital gains plus dividends - for the year ended 2012 was about 5 percent, compared with 16 percent for the Standard & Poor's 500, according to ISS.
Exxon contends that ISS's model inappropriately emphasizes short-term stock performance and disregards the long-term investing cycles for an oil company like Exxon.
In 2012, Tillerson's total compensation as calculated by the proxy firm rose 15 percent to $40 million.
Tropical Storm 02E (Barbara) Warning #03
Issued at 29/1000Z
SATELLITE East Pacific - Rainbow Color Infrared Loop
Tropical storm Barbara nears hurricane strength near Mexican coast
MEXICO CITY | Wed May 29, 2013 8:56am EDT
(Reuters) - Tropical Storm Barbara gained strength on its approach to Mexico's southern coast, the U.S. National Hurricane Center said on Wednesday.
The center reported that the storm was nearing hurricane strength with maximum sustained winds of 65 miles per hour and was located about 70 miles south of the port of Salina Cruz in southern Oaxaca state.
Salina Cruz is home to Mexican state oil monopoly Pemex's largest refinery.
Barbara churned northeast at about eight miles per hour, and is expected to swing through the Isthmus of Tehuantepec, Mexico's narrowest point, once it makes landfall later on Wednesday.
The center issued a hurricane warning from Oaxaca's Puerto Angel to Barra de Tonala, and a tropical storm warming from Barra de Tonala to Boca de Pijijiapan in Chiapas state.
Barbara is forecast to reach hurricane strength before it hits Mexico's southern coast, the center added.
Between 4 and 12 inches of rain is expected over eastern Oaxaca through western Chiapas once Barbara reaches land, along with a storm surge of between 3 to 5 feet above normal tide levels.