Central Vermont Public Service CEO Interview: Robert H. Young

• On 12:30 pm EDT, Tuesday September 22, 2009

67 WALL STREET, New York - September 22, 2009 - The Wall Street Transcript has just published its Alternative Energy/Clean Energy/Power Generation/Utilities Report offering a timely review of the sector to serious investors and industry executives. This 83 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Long Term Perspective on Alternative Energy Industry -- Leading Indicators for Alternative Energy Components Companies -- Mergers and Acquisitions in the Alternative Energy Industry -- Break Even Business Fundamentals for Carbon Free Energy Providers -- Development of Carbon Free Energy Production Infrastructure -- NAT GAS Act -- New Players in the Alternative Energy Industry -- Solar Power Cell Manufacturers Market Strategy -- Demand Response for Raw Materials for Solar Cell Production -- Alternative Energy Investment Opportunities -- Multiple Stock Winners in Carbon Free Production Industry -- Government Funding of Alternative Energy Power Providers -- Chinese Solar Energy Companies -- Alternative Energy Hedge Fund Investors -- Commodity Cycles -- Determinants of Market Valuations in the Alternative Energy Production Industry -- Carbon Emissions Statistics -- Energy Efficiency Statistics -- Innovations in Solar and Wind Power Generation -- Business Economics for Methane Based Power Generation -- Electric Vehicles Projections and Statistics-- Cap and Trade Projections and Statistics -- Development of Battery Technology -- Regulatory Environment Developments for Solar, Wind, and Alternative Energy -- Hybrid Vehicles Development and Sales Projections

Companies include: Tanfield (TAN.L); Smith Electric Vehicles U.S.; Valence (VLNC); Spire (SPIR); Newport (NEWP); MYR Group (MYRG); Primoris (PRIM); Tetra Tech (TTEK); EnerNOC (ENOC); Comverge (COMV); EnergyConnect (ECNG.OB); Calgon Carbon (CCC); and Ener1 (HEV); Westport Innovations (WPRT); Clean Energy Fuels (CLNE); Fuel Systems Solutions (FSYS); FuelCell Energy (FCEL); FEI Company (FEIC); Veeco (VECO); ATT (ATT); Landi Renzo (LR.MI); Teleflex (TFX); Royal Dutch Shell (RDS.A); Wal-Mart (WMT); Pepsico (PEP); FuelMaker; Chevrolet; GM; Honda (HMC); Itron (ITRI); Siemens (SI); American Superconductor (AMSC); GE (GE); and ABB (ABB);

In the following brief excerpt from the 83 page report, Robert H. Young, CEO of Central Vermont Public Service, discusses the outlook for the sector and for investors.

TWST: Would you begin with an overview of the principal business of CVPS and highlight the most important events in recent corporate history?

Mr. Young: First of all, while we are small by national standards, we are the largest investor-owned electric utility in the state of Vermont. We serve about 159,000 customers in a rural service territory of 18 customers per mile of line. We are very pleased that we have amongst the lowest rates of any investor-owned utility from the mid-Atlantic up through New England. And we also have a power supply, which is fundamentally hydro and nuclear with a very low carbon footprint. From a customer service standpoint, we participate in the J.D. Power survey of eastern electric utilities, and we have ranked either second or third overall for a number of years. So I think the company is held in high regard by its customers, not only because of our low rates, but also on account of the quality of customer service we provide on a daily basis. We've faced two of the worst storms in our history in the past two years, which wreaked havoc on our systems, and our employees responded incredibly well. As a result, we won the 2007 and 2008 Edison Electric Institute Emergency Recovery Awards. We are the smallest company to ever win it, let alone win it twice.

TWST: Would you give us a general picture of the health of the area that you serve and the economic outlook?

Mr. Young: Vermont is a very small state with a fairly diverse economy, and one that continues to suffer along with the rest of the country. We are seeing declining revenues in the company this year, down anywhere from 1% to about 6% or 9%, depending on customer class, consistent with what's going on around the country. Vermont tends to go into recession after other states and recover later than others if history is any guide, and I suspect it would this time, too. We expect some rebound next year, but it may be a year or two before we get back to 2008 sales levels.

TWST: Overall, what are the industry-level dynamics that will have the most impact on your operations and your ability to execute?

Mr. Young: In Vermont there is tremendous pressure to keep rates down, while at the same time regulators and customers want us to provide more and more services. So there is an ongoing tension. In all probability, we will be moving ahead with a smart grid project over the next three years or so, which will be an enormous capital outlay for a company our size - somewhere in the neighborhood of $40 million to $60 million. This is something that the state wants us to do, as it would help to reduce the overall use of energy in Vermont. Also by virtue of the fact that we'll be putting broadband around the state to accommodate the smart grid technology, we'll be helping with other economic development over time. We certainly have to continue to rebuild our system like many utilities in the United States, as we have an aging infrastructure. So we will be investing a good deal of capital over the next seven or eight years to rebuild our distribution and transmission systems. Also we have to continue to put resources into our transmission business so that we will have the bulk capacity needed to meet the ongoing and growing demands of Vermont consumers.

TWST: Throughout the energy industry, currently there is a lot of talk about cap and trade, smart grid management, demand response technologies and more. What impact will all these discussions have on CVPS and what are some of the resolutions for your company?

Mr. Young: We will do smart grid. We already are doing demand response in the company and in the state in a fairly advanced way. Cap and trade will impact us through ISO New England - it really will not impact us too much as an individual utility, and the reason is we don't produce very much carbon. By virtue of the fact that we are primarily a hydro and nuclear company, we don't burn a lot of fossil fuel. However, if we are buying power in the New England marketplace in ISO New England, by and large prices are set by gas-fired units, which by definition are on and producing most of the time. That's where we will feel the impact. So the carbon issue will have an impact in a larger sense in the region and that, in turn, will affect us. EE

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 83 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

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