Natural Gas Prices Recover From Current Lows By Q2 2010 According To Macquarie Capital: US$8.75/MMBTU Average In 2011

• On 2:06 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 report offering a timely review of the sector to serious investors and industry executives. This 83 page feature contains expert industry commentary through 23 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); AT&T (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 just one of the 23 interviews in the 83 page report, an equity analyst discusses the outlook for independent power generation and picks stock winners for investors.

Angie Storozynski is the head of the US utilities equity research at Macquarie Capital (USA). Her team currently covers 27 electric utilities, water utilities and power generation companies. She previously covered the US utilities sector at HSBC Capital (USA). Prior to that, she worked at ING Barings in the corporate finance department covering European electric utilities and telecoms. She began her career at PricewaterhouseCoopers and specialized in due diligence of electric utilities and telecoms.

TWST: Natural gas has fallen further than most people anticipated. What's going to bring it back? Just economic recovery?

Ms. Storozynski: Our E&P analysts expect a positive outcome from the current sharp pullback in natural gas prices. It should lead to a further reduction in gas drilling, which in turn should lead to natural gas shortages by the second quarter of 2010, and thus a sharp pick up in natural gas prices. They expect natural gas prices to average US$8.75/MMBtu in 2011, while the current forward natural gas curve is showing just US$6.40.

TWST: So it's the typical cycle then?

Ms. Storozynski: Yes, it is, and it was to be expected. But as in each cycle we go through bottom, like right now, and tops, which are hopefully coming soon.

TWST: As we look at, we've got the administration talking, I guess cap and trade, what is that going to mean for the sectors as we look forward?

Ms. Storozynski: This is a very interesting topic, both the future of the carbon cap-and-trade and federal renewable mandates. Unfortunately, it seems like the healthcare debate seems to be overshadowing any interest in these issues in Washington. As re result we are no longer hopeful the bill passes this year. However, the latest version of the Waxman-Markey bill proposes to allocate emission allowances for carbon dioxide to utilities and coal-fired merchants, which in turn should largely erase any earnings erosion to those companies through 2025.If a federal renewable mandate is imposed, we believe that many wind farms will be built in the Midwest, which in turn should compress margins of conventional power plants in the region and so, companies like Dynegy, Ameren (AEE), Edison Mission (EIX), and Exelon (EXC) could feel an earnings pinch longer term. On the other hand the CO2 caps should have a very positive earnings uplift to all low carbon power generation companies like Exelon or Entergy (ETR). We tend to believe that the two pieces will be in separate bills, and that the renewable portion is going to be passed first.

TWST: I guess if we go back a couple months ago, it kind of looked like it was a death knell for coal plants, but I guess they've gotten to re-breathe.

Ms. Storozynski: When you think about the fact that 50% of power demand in this country is served by coal-fired plants, you cannot pass a bill that's going to destroy this capacity. Secondly, merchant coal plants would need to recoup the additional costs associated with the CO2 caps, which would simply lead to higher power prices. I think that even if the carbon bill were to be more stringent than its current house or senate version, I would still assume that merchant generation companies and their margins should be fine at least through 2025.

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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