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Released December 27, 2019 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Consolidated Edison Incorporated (Con Ed) (NYSE:ED) (New York, New York) will increase its capital spending about 8%, or $304 million, in 2020, assuming the New York State Public Service Commission (PSC) (Albany, New York) approves a joint proposal for the power company's regulated electric and gas units in New York. A final order is expected from that regulatory body in early 2020.

Con Ed's capital spending soared in 2018 to about $5.2 billion, but this year the company plans to invest about $3.6 billion in its businesses. In 2020, assuming the PSC approves its joint proposal, capital spending is expected to increase to $3.9 billion. In 2021, spending is forecast to drop slightly.

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Click on the image at right to see a graphic on Con Edison's capital spending for the recent past and the near future.

The joint proposal, filed with regulators October 18, included a three-year capital investment program totaling $6.2 billion for Con Ed's electric business and $3.1 billion for its gas business, company officials said November 29 in an investor update.

In its November 29 investor presentation, Con Ed detailed specific capital investment plans in the joint proposal, which covers 2020-2022. On the electric side, the proposal calls for spending:
  • $3.4 billion over three years to improve reliability and expand the system
  • $222 million for grid innovation
  • $75 million investment in storm hardening for Westchester County overhead distribution
On the gas side, over the same three-year period, the joint proposal calls for investing:
  • $1.4 billion to replace about 270 miles of gas main lines
  • $43 million to deploy advanced meter-enabled gas detectors to improve customer safety
  • $65 million to modernize its liquefied natural gas (LNG) modernization facilities
Con Ed officials also said the joint proposal included several capital investments that would be considered common to its electric and gas businesses, including:
  • Continuing its $1.4 billion investment in advanced digital meters. That program, which already has installed two million advanced meters, seeks to bring that total to 5.3 million by yearend 2022. The meters are being installed in New York's five boroughs, suburban Westchester County and New Jersey.
  • Investing $421 million in a new customer service system that will connect to the advanced meters and further enhance the company's energy efficiency and demand response programs.
  • An additional investment of $68 million to facilitate a next-generation customer experience that uses data collected by the advanced meters so customers can better control their energy usage.
Industrial Info is tracking 15 Con Ed projects valued at about $936 million. By number, most of those projects are for transmission and distribution (T&D) projects in Con Ed's New York service area. But by value, Con Ed's biggest capital projects are being developed by the company's clean energy arm: a $500-million, 250-megawatt (MW) grassroot solar farm and a $160-million, 87.5-MW battery energy storage system (BESS), both in Nevada. Construction for both projects are scheduled to kick off in April 2020 and are slated to finish construction in late 2021. For more information, see Industrial Info's project reports for the solar farm project and the BESS project.

Those two Nevada projects were part of a portfolio of operating and proposed renewable energy projects that Con Ed bought from a unit of Sempra Energy Corporation (NYSE:SRE) (San Diego, California) for $1.54 billion in late 2018. The portfolio included 981 MW of operating renewable generation and renewable energy projects under development. That acquisition brought to about 2,600 MW the amount of utility-scale renewable energy plants that Con Ed operated. Solar energy projects account for about 85% of that renewable portfolio and wind accounts for the remaining 15%, Con Ed said.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
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