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Sempra Energy Exits U.S. Renewables Sector

April 25, 2019

Sempra Energy on April 22 marked its complete exit from the U.S. renewables business as it completed the sale of 724 MW of operating wind generation and battery assets to American Electric Power (AEP) for $ 1.05 billion.

The San Diego–headquartered utility holding company, which says it has the largest U.S. customer base, said the move is consistent with a strategy to pay down debt and redeploy capital to support the growth of Sempra Energy in North America.

The transaction on Monday is the latest in a series of divestitures over the past year to raise $ 2.5 billion in proceeds. As Sempra Energy CEO Jeff Martin noted in a February fourth quarter earnings call, it stems from a “deep strategic process” led by the company’s board to exit fossil-fired generation as well as renewable generation that began as early as 2014.

“[I]t’s very important to make sure we’re doing all the right things to advance the clean energy transition, but it’s also important that we’re doing that in a way which is thoughtful around price, diversity of supply in a balanced energy program,” Martin said.…

New Cyber Threat Actor Targeting Power Sector Identified

August 5, 2018

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Cybersecurity experts have identified a new activity group that they say is targeting access operations at electric utilities in the U.S., Europe, Middle East, and East Asia.

Cybersecurity firm Dragos Inc. told POWER on August 1 that though it has confirmed that the group—which it dubbed “RASPITE”—is actively targeting electric utilities, “there is no current indication the group has the capability” to conduct destructive widespread blackouts like those in Ukraine in 2016. Dragos added, “Operations against electric utility organizations appear limited to the U.S. at this time.”

Symantec, another security firm, calls the group, “Leafminer.” On July 25, Symantec said in a blog post that the group’s activity remains centered on the Middle East, mostly in Saudi Arabia—noting that threat is likely being perpetrated by Iranian actors. “One interesting source of target information discovered during the Leafminer investigation was a list of 809 targets used by the attackers for vulnerability scans,” it said. “The list is written in the Iranian language Farsi and groups each entry with organization of interest by geography and industry.”…

Increasingly Debt-Laden, Regulated Utility Sector Outlook Veers from ‘Stable’ to ‘Negative’

June 21, 2018

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For the first time since it began conducting sector outlooks, Moody’s Investors Service has downgraded the regulated utility sector from stable to negative. The new outlook reflects a surge in financial risks in the sector as more individual companies in the regulated space funnel funds to debt.

Using an analysis of 42 of the largest U.S. utility and power holding companies and 102 utility operating companies with at least 10 years of financial data, Moody’s concluded in a June 18 report that the outlook clearly points to a “declining financial trend” in the sector. The trend is a function of “higher holding company debt levels incurred in the last few years” as a result of lower cash flows, and “a lower deferred tax contribution to cash flow going forward due to tax reform.”

The credit rating agency’s downgrade is mostly rooted in “degradation” of key financial credit ratios. These include the ratio of cash flow from operations to debt; funds from operations (FFO) to debt and retained cash flow to debt; as well as certain book leverage ratios.…

DOE Lays Out How Power Sector Could Win the Cybersecurity Battle

May 19, 2018

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Cybersecurity threats are outpacing the energy sector’s “best defenses,” and costs of preventing and responding to cyber incidents are straining company efforts to protect critical infrastructure, the Department of Energy (DOE) warned as it released a comprehensive five-year cybersecurity strategy for the industry.

The Multiyear Plan for Energy Sector Cybersecurity, dated March 2018 but which was made public by the DOE’s Office of Electricity Delivery and Energy Reliability (OE) on May 14, lays out an “integrated strategy” for the DOE’s new Office of Cybersecurity, Energy Security, and Emergency Response (CESER). It essentially seeks to “gain an upper hand” in the fight against cybersecurity, outlining “disruptive changes in cyber risk management practices.”

Power companies and utilities, along with oil and gas entities, have integrated advanced digital technologies to automate and control physical functions for improved efficiency and adjust to a “rapidly changing generation mix,” but this has created a “larger cyber attack surface and new opportunities for malicious cyber threats,” the plan notes.…

Test Your Knowledge: Differences Between Private Sector and Government Managers

December 14, 2017

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It’s become a cliché that government would be better if it were only run by private-sector managers using standard business practices. However, there are significant differences between the private sector and government. This quiz is designed to test your knowledge of those differences.

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To learn 18 more differences, read “25 Differences Between Private Sector and Government Managers.”

The post Test Your Knowledge: Differences Between Private Sector and Government Managers appeared first on POWER Magazine.

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“Fitness for Purpose” Obligations for the Offshore Wind Sector

February 1, 2017

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The United States has just joined the offshore wind community with the commissioning of the Block Island Wind Farm in Rhode Island. As this community continues to grow, any decision of a common law court that provides guidance on the interpretation of contractual terms, or of the application of established common law to this new and fast-growing industry, is welcome. A recent decision by the UK’s Technology and Construction Court (TCC) contains important guidance on “fitness for purpose” obligations in a supplier contract and how these obligations apply to an offshore wind project.

Fluor entered into a contract with Greater Gabbard Offshore Winds Ltd. (GGOWL) to supply the foundations and infrastructure necessary to support 140 wind turbines for the Greater Gabbard Offshore Wind Farm in the North Sea, some 26 kilometers off the coast of Suffolk, England. To ensure the quality of the welds in these massive structures, the contract required that nondestructive testing (NDT) be carried out on the foundation monopiles, which were in turn supplied by Shanghai Zhenhua Heavy Industries Co.…