Analysts: Down on utilities. Is the party over? That’s the tough question posed in a research note by Wachovia equity research analyst Samuel Brothwell.
The Fortnightly 100 Revisited: Do Utility Stock Prices Reflect Operational Efficiency?
of the entropy index (H), which is a useful measure of dispersion, or inversely, concentration. As applied here, it is represented analytically as follows:
Where MWh is the power produced by fuel i (i = 1 ¼ ), MWht^ denotes total generation, and "log" is the natural logarithm. In order to facilitate interpretation of the results, we use "relative entropy," the "G" index, defined as follows:
Note that when only one fuel or generation source is used, since G is indeterminate, its value is set to zero.
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