SOURCE: The Bedford Report

The Bedford Report

February 07, 2011 11:25 ET

Surging Costs Shrink Bottom Lines in Utility Sector

The Bedford Report Provides Analyst Research on FirstEnergy & GenOn

NEW YORK, NY--(Marketwire - February 7, 2011) - Combating rising costs, several companies in the Electric Utilities Sector issued disappointing 2011 guidance. Stricter environmental regulations require that any new power plants built that are large enough to produce 75,000 tons of carbon dioxide a year must use the best available control technology, which is expected to add significantly to operational costs. Additionally, both state and federal governments are imposing new mandates that stipulate a certain portion of energy production must come from green sources. The Bedford Report examines the outlook for companies in the Electric Utilities Industry and provides research reports on FirstEnergy Corporation (NYSE: FE) and GenOn Energy, Inc. (NYSE: GEN). Access to the full company reports can be found at:

A significant change facing the utilities sector is the implementation of the Smart Grid. A digital upgrade to old analog distribution systems, the smart grid allows companies to more closely monitor the electricity usage. Additionally, the smart grid gives companies the option to charge variable rates based on the time of day and more easily integrate new renewable energy sources like wind and solar. This increased efficiency and lower energy usage could potentially save around $20 billion a year in energy costs.

The Bedford Report releases regular market updates on the Electric Utilities Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous analyst reports and industry newsletters.

Combating rising costs, companies in the Electric Utilities Sector have been looking to mergers and acquisitions to keep profits steady -- mergers and acquisitions help grow a company's size, allowing it to better afford these rising costs. Last month Duke Energy announced that it has agreed to buy Progress Energy for $13.7 billion in stock. Pending approval from regulators in North and South Carolina the deal will create the largest US power company. While analyst consensus is that the deal has a good chance of winning approval, be forewarned that state regulators have rejected proposed deals in recent years that would have created utility giants.

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