We believe an impactful but overlooked green investment opportunity lies in energy transmission — moving low cost wind and solar energy across the country. But for all its potential, transmission has been fraught with roadblocks and complications.
During a call in May of this year, hosted by Havener Capital Partners for the benefit of investors, our own John Bartlett explained the investment opportunity, and why companies may finally be able to swing transmission strategies into action. The following is a synopsis of his comments:
One of the things that I'm most excited about is energy transmission. If we're going to bring more of this cheap, renewable power into the system, we're going to need a longer extension cord. And that's coming. There are well positioned companies, both geographically and from a strategy standpoint that are going to have an opportunity at some point for at least 10 to 12 years, potentially starting from here. It's a great business opportunity because it's a capacity business. There's no volumetric risk. Once you've got (the transmission system) in the ground and up and running, the revenues could look like an annuity …
The Biden administration is committed to getting transmission built and the problem isn't money. The challenge is to get local regulators on board, and this is where the federal government can play a great role. I mean, picture yourself in the Midwest in the middle of wind country and trying to convince your constituents that it's a good thing for you to spend money on transmission for the privilege of sending your really cheap power elsewhere. That has to get unlocked by the federal government, and I think that at very high levels, the heart is in the right place. They haven't quite figured out how to get it, but I think they're going to be able to do it.
To hear more about why we believe a transition to renewable energy may be a good for utility investing, listen to our full call. Please click graphic below to gain access to the call replay.
