GE expands rentals unit
GE Power Systems has accelerated growth in the energy rentals business through the acquisition of two companies, Showpower Inc. and Spot Coolers of Miami Inc. GE agreed to purchase 100 per cent of Showpower’s shares for an aggregate purchase price of $28m, while terms of the Spot Coolers deal were not disclosed. California, USA-based Showpower provides temporary power generation and temperature control rental equipment from bases in the USA, the UK and Brazil. It specialises in the entertainment, corporate and special events markets. Spot Coolers is a leading provider of rental air conditioning and power generation services in south Florida, specializing in serving the commercial sector.
The acquisitions will bolster GE Power System’s Energy Rentals unit, which was launched in 1999 in response to the growing demand for temporary distributed power services. “A turnkey rental solution is a cost-efficient method to respond to changing business or market conditions while avoiding capital outlays,” said Martin Moore, president of GE Energy Rentals.
Tractebel examines structure
Belgian utility Tractebel has entered the third phase of its industrial plan by starting to examine its corporate structure, and wants to double its electricity sales volume by 2003.
The company, which is owned by France’s Suez Lyonnaise des Eaux and whose main assets include stakes in power company Electrabel and gas company Distrigas, has also said that it is open to new alliances.
Tractebel will look at how its internal corporate structure can be optimized, although no strict timetable has been set. One option it will look at is whether to merge Electrabel and Distrigas in order to take advantage of liberalizing European markets. The first stage of the industrial plan identified Europe as its main market for future expansion, with the USA and Latin America also key.
The industrial plan was initiated in 1999 when Suez completed its buyout of Tractebel. It also sets the target of doubling 1998 electricity sales by 2003 without increasing production assets by more than 50 per cent. To achieve this, it is likely to need joint venture alliances and acquisitions like its recent acquisition of Dutch generator Epon.
ABB reports strong earnings, continues technology shift
ABB in February reported strong earnings and increased cashflow for 1999, and announced a strategy that will see it continuing its shift away from heavy engineering towards high value, knowledge-based businesses with strong R&D capabilities. The company is preparing itself for a US stock listing.
Labelling itself a global “technology” company, the group reported a 16 per cent rise in operating earnings to $2416m and a 76 per cent rise in net operating cashflow to $1823m. Net income rose 24 per cent to $1.6bn, including capital gains from the creation of the ABB-Alstom Power joint venture.
The company accelerated its shift towards becoming a knowledge and service company, completing its acquisition of Elsag Bailey Process Automation and divesting its power generation business into ABB-Alstom Power. It invested $2bn, or eight per cent of revenues, in R&D of innovative technologies such as Powerformer and Dryformer.
“We’re facing a new world where speed, flexibility and brain power are the keys to delivering great value, and we’re reinventing ABB to be a leader in that world,” said President and CEO Göran Lindahl. “We’re expanding into businesses where we can be leaders and leaving businesses where we can’t.”
Major drivers for power transmission will be service and retrofit, cross border grid interconnection, advances in high voltage technology, and electricity trading systems. ABB’s power distribution business will target liberalized markets, focussing on modular, intelligent products and solutions.
NPS shifts focus
Idacorp subsidiary Northwest Power Systems has announced that it is to change its focus from being a supplier of fuel cell components to being a manufacturer of fully integrated fuel cell systems. The company hopes to achieve its aims through the creation of strategic partnerships with other manufacturers.
The company will now ramp up the production of integrated fuel cell systems for both stationary and portable applications based around its proprietary reformer technology. It previously focussed efforts on supplying components to other fuel cell companies.
Northwest Power will start to merge its interests with strategic partners. It will then commence full scale development and manufacture of fuel cell systems for use with conventional fuels such as methanol, diesel, propane and natural gas.
UtiliCorp buys TransAlta units
Power company TransAlta Corp. has sold its retail and distribution business units in Canada to US energy group UtiliCorp United Inc. for $645m. It is also in talks with New Zealand’s Natural Gas Corp. for the sale of its majority stake in TransAlta New Zealand.
The deal for the Canadian assets include 90 000 km of low voltage distribution lines and a call centre in Calgary. UtiliCorp will keep all of TransAlta’s distribution and retail employees.
TransAlta Corp. is shifting its core focus towards generation and high voltage transmission operations.
ABB Alstom Power reports: Newly formed joint venture company ABB Alstom Power has announced pro forma results for 1999. The company said that orders rose by 14 per cent while revenues remained flat. Higher revenues in the gas turbine sector, particularly from the USA, were offset by a decline in steam turbine revenues. Operating earnings for July to December 1999 were euro26m ($25.5m).
Ballard dispute: Canadian fuel cells manufacturer Ballard power Systems is reported to be embroiled in a dispute with the Canadian government over the ownership of international patents dating back to 1988. The government believes that Ballard should be paying royalty fees as it owns the intellectual property rights on early fuel cell designs created when Ballard was conducting research into submarine propulsion systemsfor the Department of Defence.
BP Solarex record: BP Solarex has announced that it has exceeded its revenue and cost savings goals for 1999, reporting record revenues of $179m against a target of $160m. Annualized cost savings were $25m. The company said in a statement that it has set “new, aggressive goals for 2000”, and is on course to hit a revenue goal of $1bn by 2007. It said that it has completed major rural electrification projects in the Philippines and Indonesia.
Plug Power results: US fuel cell manufacturer Plug Power has reported a net loss of $33.5m for the year ending 31 December 1999. Revenues for 1999 were $11m compared with $6.5m for the previous year. The company said that it built 52 fuel cell systems in 1999 for both onsite and offsite testing. The results of this testing programme will be used to enhance the designs for its beta unit programme, which envisages production of 500 units in 2000. PowerGen divests: UK generator PowerGen has sold East Midlands Electricity Contracting (EMEC) to ABB for an undisclosed sum. PowerGen acquired EMEC when it bought East Midlands Electricity in 1998. EMEC undertakes electrical transmission and distribution projects in the UK and has revenues of over $60m. It will be integrated with ABB Power T&D Ltd.
Tepco offers support: Tokyo Electric power Co. is to offer consulting and technical support to hydropower plants around the world. It is venturing into international markets as demand for these services in Japan is falling, and is aiming to eventually become a developer of hydro projects. Initial projects include work on plants in Vietnam and Bangladesh.