CI VIEW: Exelon passes on Entergy’s nuclear assets, Exelon CEO Crane

 

WASHINGTON/BRESCIA (BBN) – Chicago-based Exelon Corporation (NYSE: EXC) is no longer interested in acquiring the nuclear assets of Entergy (NYSE: ETR) if the New Orleans, Louisiana-based company goes ahead with a long-rumored sale, Exelon President and CEO Christopher M. Crane said.  

[Exelon President and Chief Executive Officer Christopher M. Crane speaks with Capitol Intelligence/Smart CEO using CI Glass about Entergy, STEM schools and ENEL at the Baltimore Washington Corridor Chamber Annual Meeting at BWI Marriott,  May 11, 2016]

Exelon CEO Chris Crane had previously told Capitol Intelligence that Entergy’s nuclear assets are of high quality and could be an attractive target for Exelon.

A nuclear industry source said speculation spiked that Entergy would go ahead with a sale of its nuclear assets after Entergy was blamed for a 35 minute power outage in the middle of the 2013 Super Bowl in New Orleans between the Baltimore Ravens and the San Francisco 49ers.

“For us in the nuclear industry such a massive failure by an utility is sort of like having Santa Claus crash into the Empire State building,” a source at a US utility that operates nuclear plants said. Entergy originally planned to spin-off its nuclear assets into a separate stand-alone company named Enexus but ultimately dropped the project.

A source familiar with the Nuclear Regulatory Commission said the agency would not be opposed to Entergy selling its nuclear business to another operator and that such a move could solve many issues relating to management reliability at Entergy.

The non-starter for a bidder for Entergy’s nuclear assets and current political uncertainty surrounding US Presidential elections does not mean that US utilities will not pursue strategic mergers or other acquisitions, Columbus, Ohio utility American Electric Power (NYSE:AEP) Chief Operating Officer Robert Powers told Capitol Intelligence/BBN.

[American Electric Power (NYSE:AEP) EVP and Chief Operating Officer Robert Powers speaks to Capitol Intelligence/BBN using CI Glass on M&A ahead of November 2016 presidential elections at the United States Energy Association Annual Membership Meeting. National Press Club of Washington, DC. May 5, 2016]

Powers noted that US utilities are actively balancing their portfolios of natural gas, nuclear and renewable power plants in such a way to lower C02 emission and at the same time provide reliable and cost effective energy supply.

BP Capital Management Chairman T. Boone Pickens, Jr, said it does not make sense for US utilities and energy companies to seek growth outside of the United States.

He said that the discovery of major natural gas reserves makes the United States is so attractive that foreign state-controlled oil and energy companies are coming to the United States to sign JVs for domestic exploration and production projects.

[BP Capital Management Chairman T. Boone Pickens, Jr. speaks to Capitol Intelligence using CI Glass at The Atlantic Washington Ideas Forum. Washington, DC. Oct. 29. 2014]

While Entergy and AEP both said that they remain focused on the US market, Exelon’s Crane said that the Chicago-based company has been working in close partnership with Italy’s largest utility ENEL to transfer the company’s market leading smart meter technology and know-how to the US market.

In fact, ENEL has been able to use its smart meter technology to solve the age-old problem of utilities of how to subsidize low-income customers without giving unneeded charity to affluent consumers.

Italy’s a2a, the listed utility controlled by the cities of Milan and Brescia, is launching a SmartCity initiative that no only uses smart meters but provides citizens with real-time information on parking and public transport, trash removal and security data to local police forces.

[a2a CEO Valerio Camerano speaks with Capitol Intelligence/CI MENA using CI Glass at Smart City news conference in Brescia, Italy. March 21, 2016]

While Google (Aka Alphabet (NYSE:Goog) — has failed miserably to break into the consumer smart meter and SmartCity space — ENEL and a2a have exploited the uniquely Italian skill of applying existing technology to create transformational solutions.

By PK Semler in Washington, DC and Brescia, Italy.  For information please call +1-202-549-3399 or email pks@capitolintelgroup.com

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