The Return for Customers of the Return for Shareholders
Steve Mitnick is Editor-in-Chief of Public Utilities Fortnightly and author of the book “Lines Down: How We Pay, Use, Value Grid Electricity Amid the Storm.”
Take a look at this issue’s Mega Metrics feature. It has our 2016 Top Twenty Financial Performers.
Top Twenty? I know what you’re thinking. Isn’t this annual ranking of ours a top forty?
It’s not that the list has half the companies and therefore is half as valuable. Yes, the list is half the size. But it’s twice as valuable. Or thereabouts.
The Top Twenty ranking is now limited to investor-owned electric utilities and combination electric and gas utilities. It’s also limited to such companies, electrics and combos, with revenues last year of at least a billion.
We did this so as to not mix up large electrics and combos with companies that are miles apart in strategy, situation and size. There are many great investor-owned electrics that are relatively small. And there are many great gas utilities, large and small. And great non-utilities that own and operate electric and gas assets.
But as investments, they’re not all that comparable, if we put them in a single bucket with large electrics and combos. The bucket would be too varied for the purpose.
In the world of finance, investors have numerous choices as to where to place their bets. It’s unclear that investors consider as comparable, a large electric with a large or small gas, any more than with a large highly-regulated non-energy company.