Infrastructure
Northeast Storms Going After Utilities (NU, ED, XLU)
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The major and very premature snow storm in the Northeast is having at least some impact on power companies and their customers. Reports are all over that more than 2 million (or more) are still out of power in their homes and businesses. Sadly, these repairs are not as simple as turning the switch back on. When trees knock out or get pinned on power lines, it takes time and manual labor. When power lines freeze and break on their own, those have to be manually reinstalled by workers. It usually takes days and days rather than hours.
Northeast Utilities (NYSE: NU) is holding up rather well considering the snow and ice that has knocked out so much electric power in the Northeast. The utility offers electric and gas services to residential, commercial, and industrial customers in Connecticut, New Hampshire, and western Massachusetts.
Consolidated Edison, Inc. (NYSE: ED) offers energy services to residential, commercial, industrial, and government customers in New York, some areas of northern New Jersey and northeastern Pennsylvania.
Utilities Select Sector SPDR (NYSE: XLU) is down 0.17% at $34.95. Northeast Utilities (NYSE: NU) is down 0.7% at $34.34 and Consolidated Edison, Inc. (NYSE: ED) is down only 0.15% at $57.95.
It may be a rather simple matter for utilities in that power providers do carry insurance. The most obvious is that the firms might not have paid for catastrophic interruption of power from snow and ice this early into the fall and winter season when it is technically still hurricane season.
JON C. OGG
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