Financial Post -The uranium sector came under selling pressure on Monday after Germany announced it will shut down all of its nuclear reactors by 2022, reversing an energy policy established just last year that called to extend the lifespan of its fleet.

The decision comes as little surprise given the growing anti-nuclear backlash globally following Japan’s Fukushima disaster and after German Chancellor Angela Merkel’s government lost ground to the Green party in recent state elections.

Despite the negative reaction from uranium investors as Germany is set to become the first major nuclear-free industrial power, analysts remain optimistic about the nuclear fuel. They cited continued support from some of the world’s biggest consumers of uranium and Germany’s relatively limited role.

“Germany has long been regarded as ‘weak’ on nuclear power and was not expected to be a significant factor in reactor growth over the medium or long term,” said Greg Barnes, an analyst with TD Newcrest.

“We continue to expect that the uranium price should recover from the Fukushima incident, albeit slowly,” he added. “China, India and South Korea — all three of which are expected to add significant new nuclear capacity — have recommitted to nuclear power following the events at Fukushima.”

Mr. Barnes told clients the move would have only a slightly negative impact on Cameco Corp., one of the world’s largest publicly-traded uranium companies. Its shares have fallen roughly 25% since the massive earthquake and tsunami hit Japan on March 11 while several smaller uranium names have fared worse.

On Monday, Cameco Corp. fell 3.3%, Paladin Energy Ltd. declined 3.2%% and Uranium One Inc. dipped 2.6%., while Denison Mines Corp. rose 2.6%.

Germany’s largest utilities, EON AG and RWE AG, fell 2.2% and 1.7%, respectively. Meanwhile, solar power firm Q-Cells SE and Solarworld AG climbed more than 9%. French nuclear giant Areva SA fell nearly 2%.
The nuclear renaissance appeared to be well underway without much German involvement as it currently uses only 5% of the world’s uranium supply. This number was expected to fall to 4.1% by 2015 and 3.2% by 2020.

The decision comes as Tokyo Electric Power has still not decided how to deal with the Fukushima power plant site, where radioactive soil pockets have reportedly reached the same level as Chernobyl.

Since the Fukushima disaster, many countries have announced in-depth safety reviews of their nuclear reactors and placed near-term moratoriums on new plants.

David A. Talbot, an analyst with Dundee Securities, believes investors in the uranium sector should stay the course. He said the long-term fundamentals remain very strong for the sector — despite Germany’s decision to opt out.

“We believe that China’s growth alone should dwarf the German impact,” Mr. Talbot said in a research note, anticipating China will use five times the fuel requirements of Germany by 2020.

Despite having only 13 reactors in operation, China already uses 11.5 million pounds of U3O8 annually, compared to Germany at 9 million. China also has 27 reactors under construction, 50 planned and 110 proposed. Early this month, it reiterated that its long-term goals for nuclear power remain unchanged following the events in Japan.

“It should not impact the spot market of which the uranium stocks tend to trade in tandem,” Mr. Talbot said. “It could impact the stocks in the short term as this news plays with investor perceptions of Germany’s importance.”
Germany has 17 nuclear reactors, nine of which are currently running at full capacity, generating roughly 23% of the country’s energy requirements. However, Ms. Merkel suggested renewal energy sources such as wind and solar will beable to make up the shortfall.

“Our energy system has to be fundamentally changed and can be fundamentally changed,” she told reporters on Monday. “We want the electricity of the future to be safer and, at the same time, reliable and economical.”

jratner@nationalpost.com

Reuters – Regulators will investigate why more than 50 power generating units in Texas failed due cold weather on Wednesday, forcing the state’s grid operator to impose rolling blackouts as demand exceeded available supplies.

“NERC will be investigating the adequacy of preparations for the extremely cold weather and what improvements are necessary,” Gerry Cauley, president and CEO of the North American Electric Reliability Corp, told Reuters.

NERC establishes and enforces the reliability standards for the North American power grid.

“We understand that the record-breaking weather conditions exceeded the normal planning conditions but will look to determine what can be done better in the future to prevent unexpected unavailability of generation under such conditions,” Cauley added.

All power plants are built to a certain standard based on the weather expected in their location. The plants in the northern parts of the United States are more weatherized than those in the South, according to electricity traders who used to work at power plants.

In the North, plants have heaters and monitors on water pipes and other equipment outside in the cold that in the past may not have been needed on plants in the South.

But in the South, where temperatures can top 100 degrees Fahrenheit (37.8 Celsius) for several days in a row, plants are designed to take the heat much better than units in the North.

EXTREME COLD

More than 50 power units representing more than 7,000 megawatts of generating capacity were unable to run Wednesday when the mercury dropped and a fierce winter storm dropped snow and ice on several parts of Texas.

High temperatures in Houston, the biggest city in Texas, plummeted from 70 degrees F (21.1 Celsius) Tuesday to 39 degrees Wednesday, according to weather forecaster AccuWeather.com.

In Dallas, which recorded a high of 18 degrees on Wednesday, the average temperature was 30 degrees below the normal, AccuWeather.com said.

“The cold lasted longer and was more extreme than we are used to,” said David Knox, a spokesman for NRG Energy Inc, one of the biggest power generators in the state.

“Our units performed extremely well, but we had some issues and are looking to see what we can learn to make the system even more reliable in the future,” Knox said, noting NRG’s plants met over 15 percent of the demand in the ERCOT grid on February 2.

ERCOT operates the power grid for 22 million Texas customers, representing 85 percent of the state’s electric load and 75 percent of the state’s land area.

NRG, of Princeton, New Jersey, owns more than 25,000 megawatts of generation, including numerous units in the U.S. Northeast where temperatures regularly drop below freezing in the winter.

Once this crisis is over and the grid operator stops urging customers to conserve energy, ERCOT, NERC and state and federal energy regulators can figure out what can be done to make the grid more reliable.

(Reporting by Scott DiSavino; editing by Jim Marshall)

E&E Publishing – Threatened with lawsuits from environmental groups, the Obama administration has agreed to issue another round of greenhouse gas limits for both power plants and refineries — this time through a provision of the Clean Air Act that allows U.S. EPA to require pollution controls at both new and existing facilities.
More News From Greenwire

The agreement suggests the administration plans to press forward with its efforts to address climate change, despite the failure of the cap-and-trade bill in the Senate this year and the expectation of a backlash in Congress once regulation-averse Republicans seize control of the House next month.

Under today’s deal with several states and environmental groups, EPA plans to issue a “modest” set of performance standards for two sectors that produce about 40 percent of U.S. greenhouse gas emissions, air chief Gina McCarthy told reporters this morning.

The rules for power plants (pdf) would need to be proposed by July 26, 2011, and finalized by May 26, 2012. Proposed standards for refineries (pdf) would need to be released by Dec. 10, 2011, with a final rule due on Nov. 10, 2012.

Because putting the rules in place will demand significant resources, EPA Administrator Lisa Jackson has decided to focus on the largest sources of greenhouse gas emissions first, McCarthy said. The agency will still meet its Clean Air Act obligations for other industries, she said, leaving open the possibility that performance standards could be issued later for other sectors, such as cement kilns.

“In refineries and power plants, we have large amounts of emissions, we have significant opportunities for cost-effective reductions, and we have relatively few sources to have to regulate,” McCarthy said. “So it was her decision that in 2011 this would be the focus of EPA’s attention.”

The performance standards are also expected to get substantial attention from Congress next year. Despite being announced the day before Christmas Eve, the deal got a noisy and divided reception inside the Beltway, where leading critics of the Obama administration’s approach to climate change predicted that the new regulations will play right into their hands.

The plan to issue performance standards was praised by environmentalists, who wanted to put a price on planet-warming gases and feel the rules are the best option left after the failure of the cap-and-trade bill in Congress. But Republicans and industry groups described today’s agreement as another step toward a “backdoor” cap-and-trade program, vowing to stop the regulations from taking effect.

Fred Upton (R-Mich.), the incoming chairman of the House Energy and Commerce Committee, said in a statement today that the push to establish greenhouse gas pollution standards under the Clean Air Act is “a crescendo” in EPA’s ongoing assault on energy producers. Upton said the effort doesn’t help protect American jobs or fortify the country’s energy security.

“We should be working to bring more power online, not shutting plants down,” Upton said. “We will not allow the administration to regulate what they have been unable to legislate — this Christmas surprise is nothing short of a backdoor attempt to implement their failed job-killing cap-and-trade scheme.”

Alaska Sen. Lisa Murkowski, the top Republican on the Senate Energy and Natural Resources Committee, sponsored a resolution this year to stop EPA from regulating greenhouse gases under the Clean Air Act. It failed on the Senate floor, but with an upcoming shift in the balance of power and a new batch of costly rules on the way, those types of measures could get more support, Murkowski spokesman Robert Dillon said.

“The administration used the threat of EPA regulations as a cudgel to force Congress to pass cap and trade. It was a strategy that failed,” he said in an interview. “You’ve opened Pandora’s box now. You’ve let the agency loose with these new regulations when they’re interpreting the law.”

The New Source Performance Standards (NSPS) would go beyond the Obama administration’s first set of greenhouse gas regulations, which are aimed at emissions from cars, light trucks and the largest new industrial facilities. Those rules, which are focused on energy efficiency and apply only to new vehicles and facilities, are set to take effect on Jan. 2.
But the new rules, despite their misleading name, allow EPA to limit emissions from existing power plants and refineries, expanding the scope of the climate program beyond the handful of large plants that are expected to be built or renovated over the next few years. The agency has the discretion to set an efficiency standard for the two industries, perhaps requiring plants to release no more than a certain amount of greenhouse gases for every megawatt of electricity that is generated or gallon of fuel that is refined.

Experts say the potential reductions are modest but significant as the Obama administration tries to cut U.S. greenhouse gas emissions by 17 percent from 2005 levels by 2020. According to a recent study by Resources for the Future, a nonpartisan think tank, the utility sector could cut its emissions by 5 to 10 percent with efficiency standards and rules that require biomass to be burned along with coal.

The options for setting performance standards under the Clean Air Act are more flexible than the rules for construction permits that will be required starting Jan. 2, McCarthy said.

Some experts have suggested the standards could allow businesses to buy, sell or swap the right to release carbon dioxide and other planet-warming gases, but EPA does not plan to limit total emissions, McCarthy said today. She said the agency has no target in mind for the overall emissions reductions that it could achieve.

“The NSPS process is a tool of the Clean Air Act that we’ve used 75 times before,” McCarthy said. “This is not about a cap-and-trade program, it’s nothing unusual to greenhouse gases, and it’s not in any way trying to get into the area where Congress will be establishing law at some point in the future — we hope.”

Eye on the economy

Supporters of the rules hope that limiting emissions at power plants and refineries will hasten a shift from fossil fuels — such as coal, which provides more than 40 percent of U.S. electricity — to cleaner sources of energy such as wind or solar. They say EPA has been legally obligated to take these steps for years, and that the technology to meet the upcoming rules is already affordable.

“EPA is doing precisely what is needed to protect our health and welfare and provide businesses certainty at a time when some would prefer to roll back the clock,” said David Doniger, policy director of the Natural Resources Defense Council’s Climate Center.

But while the agreement was praised by environmentalists, who are worried that unchecked industrial emissions are causing dangerous changes to the Earth’s climate, it was criticized by industry groups, which argued that the new regulations will impose chilling costs on American businesses while doing little or nothing to help the environment.

Some trade groups representing utilities, energy-intensive businesses and the oil industry are challenging the legality of EPA’s new rules in court while pushing for Congress to overrule EPA’s regulations.

Today, those groups took the occasion to challenge President Obama. Just last week, he spent several hours with a group of business leaders at the White House and promised to take a “balanced approach” to regulation to help the economy rebound from the worst slowdown since the Great Depression.

Today’s agreement is the opposite of what President Obama was seeking when he pledged to put economic recovery first, said Charles Drevna, president of the National Petrochemical and Refiners Association, in a statement.

“EPA’s proposals would carry tremendous costs but no benefits for the American people — all pain and no gain,” Drevna said. “Regulations can’t create technology that doesn’t exist or change the laws of physics and economics, so the only way to comply with EPA’s proposals would be to inflict massive increases in energy costs and massive increases in unemployment on families across our nation.”

Jackson and other top EPA officials have argued that these types of environmental rules haven’t stifled the economy in the past, but businesses have lingering worries that greenhouse gases are different. Unlike the nitrogen oxides (NOx) and sulfur dioxide (SO2) that cause acid rain, skeptics say, carbon dioxide is ubiquitous and impossible to curb on a global scale without cooperation from other countries.

Performance standards have been used for decades to make plants install the newest air pollution controls and run their equipment in ways that reduce emissions, they say, but there’s no such thing as a scrubber for carbon dioxide. As things stand right now, there’s no practical way to keep large amounts of carbon dioxide out of the atmosphere without trapping it underground.

But while carbon capture could someday become the norm for power plants and refineries, EPA has admitted that it isn’t a viable technology. Projects are under way around the world, but the process is still expensive and relatively untested, the agency said in a November document that provided guidance on its previous round of regulations for high-emitting facilities.

Facilities will only need to use existing technology to reduce emissions in a cost-effective way, McCarthy said today.

Of all the programs in the Clean Air Act, she said, the performance standards are “one of the most flexible and common-sense approaches that we can take to reduce pollution in sectors where we have determined that pollution reductions are necessary to guarantee public health protection as well as protection of welfare.”

Hill battles ahead

Though industry lobbyists are confident that the Republican-controlled House will pass legislation next session to block or delay the regulations, those types of measures still face an uphill battle in the Senate.

But Republican committee chairmen with jurisdiction over EPA rules will have the opportunity to probe the new rules at hearings and summon Jackson, among other top officials, for an explanation. They could also try to tighten EPA’s purse strings or pass legislation to block the new rules, though a veto from Obama would be nearly impossible to overcome, experts say.

These lawmakers, many of whom previously challenged the scientific argument for climate change and tried to rebrand cap and trade as a “cap and tax” scheme, said the performance standards would slam American consumers by hiking electric bills and raising the cost of gasoline. They are preparing for a bruising fight with the Obama administration at a time of nearly unprecedented debate over environmental regulations in general and, more specifically, any proposal that would force action on climate change.

One House member who has already showed his willingness to tangle with EPA is Rep. Darrell Issa (R-Calif.), the incoming chairman of the House Oversight and Government Reform Committee.

Issa spokesman Kurt Bardella said today the congressman is disappointed by the decision to move forward with new regulations, in part because he believes they will hurt an already fragile economy. But he also dislikes the Obama administration’s tactics.

“There are serious questions about EPA’s decision to move forward with these job-killing regulations that will usurp power from states — violating the principles of federalism that are the backbone of the Clean Air Act,” Bardella said.

Long legal road

Environmentalists have spent years suing EPA to make the agency issue limits on greenhouse gas emissions, but they have only made headway during the tenure of President Obama, who has described climate change as a major threat to humanity and has vowed to tackle the issue.

The performance standards for power plants and other sectors were sent back to EPA after the Supreme Court’s 2007 ruling in Massachusetts v. EPA, which held that greenhouse gases can be controlled as a pollutant under the Clean Air Act if EPA decides that they are a threat to human health and welfare.

Environmentalists wanted the agency to make that scientific decision, and once it did — in December 2009 — they redoubled their push for federal limits on the amount of greenhouse gases that large industrial sources are allowed to emit.

Until today, there were frequent signs that the agency would start issuing the performance standards, but nothing definitive.

In its draft budget for the current fiscal year, the White House requested $7.5 million to consider and possibly develop the performance standards for key industry sectors. The request said the White House was trying to limit greenhouse gas emissions “through means that are flexible and manageable for business,” prompting swirling speculation about an administration-sanctioned cap-and-trade program.
The first major opportunity for such a program came in August, when EPA issued performance standards for the cement industry — the nation’s third-largest source of greenhouse gas emissions, after power plants and refineries.

EPA passed on the issue, saying it couldn’t require emissions cuts because it didn’t have adequate information to set a standard. The agency hadn’t included greenhouse gas limits in a 2008 proposal that was issued before the agency concluded greenhouse gases are a threat.

“This is not the end of the matter,” EPA wrote in its final rule. “To the contrary, based on our current knowledge we believe that it may be appropriate for the agency to set a standard of performance.”

Environmentalists challenged that decision in court last month, claiming EPA is obligated to limit greenhouse gases now that the agency has acknowledged that the emissions threaten the public.

Experts say today’s decision by EPA could have wide-reaching implications, potentially influencing a landmark global warming case that is waiting to be heard by the Supreme Court next year.

The case, American Electric Power v. Connecticut, stems from a lawsuit by states and environmental groups that claimed members of the public are being hurt by the greenhouse gas emissions from coal-fired utilities. In a brief supporting the Tennessee Valley Authority, a federally owned utility that was named as a defendant, the Obama administration argued that those types of “public nuisance” claims were pre-empted by EPA’s plan to begin regulating greenhouse gases on Jan. 2.

But those rules only apply to existing sources, the states and environmental groups shot back in a recent filing. They agreed that they would have no choice but to drop their lawsuit if EPA were actually regulating existing power plants — and the performance standards that the agency agreed to issue today would do just that.

Reporter John McArdle contributed.

Click here (pdf) to read the power plant agreement.

Click here (pdf) to read the refinery agreement.

Copyright 2010 E&E Publishing. All Rights Reserved.

Associated Press – Shares of Thomas & Betts Corp. rose on Thursday after an analyst upgraded the maker of electrical power components, saying the market for its products is improving.

THE SPARK: Oppenheimer analyst Christopher Glynn upgraded Thomas & Betts to “Outperform” from “Perform” in a note to investors on Thursday. He also raised the company’s price target to $50 from $46.

THE ANALYSIS: Glynn raised his earnings outlook for the company for this year and next, saying the company’s guidance looks “increasingly conservative.”

The company’s electrical business is improving as utility spending increases, he said, though its steel structures business “remains uncertain in the near term.”

He added that the company has “plentiful liquidity,” noting its $389 million in cash on hand as of June. It also has an attractive stock buyback program, he said. Buyback programs reduce the number of outstanding shares and can raise the price of remaining shares.

THE BIG PICTURE: The Memphis-based company had suffered from a drop-off in sales as the companies it serves cut back on spending in the economic downturn. But in July it reported signs of recovery, saying second-quarter net income jumped 48 percent.

STOCK ACTION: Shares rose $1.01, or 2.4 percent, to $43.06 in midday trading. The stock has ranged between $29.88 and $44.05 in morning trading.

(Bloomberg) – Norsk Hydro ASA, Europe’s third- largest aluminum maker, agreed to buy mining assets from Vale SA for $4.9 billion, securing a century’s worth of bauxite supplies and making the Brazilian miner its second-largest shareholder.
Hydro, based in Oslo, will give Vale $1.1 billion in cash, a 22 percent stake and take on about $700 million of net debt in return for bauxite, alumina and aluminum assets, the company said yesterday. Hydro is taking control of Paragominas, the world’s third-biggest bauxite mine, and 91 percent of Alunorte, the largest alumina refinery, as part of the deal, it said.
Hydro is seeking greater access to the raw materials used in aluminum production to become less reliant on mining companies supplying bauxite and alumina such as competitor Rio Tinto Group. Vale is selling aluminum assets because higher power costs are restricting its ability to expand. Electricity accounts for about a third of the cost of producing aluminum.
“For Hydro it makes sense to consolidate in the aluminum space and move higher up the value chain by securing their own supply of bauxite and expanding in a big way in alumina,” John Meyer, head of natural resources at Fairfax I.S. Plc. in London said in a telephone interview. “All the mining companies like their long positions in alumina and Hydro will now be a major supplier.”
Hydro Chief Executive Officer Svein Richard Brandtzaeg described the deal as a “transforming transaction” at a press conference yesterday in Oslo. In addition to Paragominas and Alunorte, the company will acquire 51 percent of the Albras aluminum plant and 81 percent of the CAP alumina project.
‘Strategic Sense’
“This deal makes strategic sense for Hydro and also appears to be attractively priced,” Samir Bendriss, head of research at Oslo-based Pareto Securities ASA, said yesterday in a telephone interview. “There’s a risk that alumina prices decouple from aluminum and will be more expensive.”
Alumina producers, including BHP Billiton Ltd., United Co. Rusal and Alcoa Inc., are seeking to change the way the semi- processed material is priced, from closed-door contract negotiations to an index system based on spot transactions. Typically, the cost of the raw material is now fixed at a percentage of aluminum prices.
Bauxite is an ore that’s refined into alumina, a white powder which is separated during smelting to produce aluminum.
The assets will “significantly improve” the Norwegian company’s financial position and secure bauxite supplies “in a 100-year perspective” according to Hydro’s statement. Rio de Janeiro-based Vale said yesterday it expects the transaction will create “substantial value” for shareholders.
“I think this should be well-received by Hydro shareholders,” Bendriss said. “The shares should move up on this news.”
Expanding Production
Vale is focused on expanding iron ore production after securing price increases of about 90 percent this year. The company said April 30 it agreed to pay $2.5 billion for iron-ore deposits in Guinea from BSG Resources (Guinea) Ltd. as it diversifies supply of the steelmaking ingredient. Brazil is home to the Carajas mine, containing some of the world’s best ore.
“This deal’s unique side is that Hydro isn’t facing any competition from Chinese or Middle Eastern rivals,” Gudmund Halle Isfeldt, an Oslo-based analyst at DnB NOR ASA, said in a telephone interview. “This gave the parties a good opportunity to strike a deal to strengthen their business relations.”
The rights offer, set for completion in July, will preserve Hydro’s financial flexibility, Brandtzaeg said at the press conference. The transaction will reduce the Norwegian state’s ownership in the company to approximately 34.5 percent from 43.8 percent, Norway’s Minister of Trade and Industry Trond Giske also said. Norway’s “ambition in the longer term” is to bring the holding back up towards 40 percent, he said.
Share Sale
Hydro plans to raise 10 billion kronor ($1.69 billion) in a new share sale to finance the transaction. After the rights issue, Vale will own 22 percent of Hydro’s outstanding shares, according to the statement.
Vale becomes the second-largest shareholder in Hydro after the government. A representative of the miner will join the Norwegian company’s board of directors and the company agreed to not increase its shareholding, Vale’s Executive Director Tito Martins said in an interview yesterday. Vale doesn’t foresee any job losses as a consequence of the deal, he said.
–With reporting by Meera Bhatia in Oslo and Brett Foley in London. Editors: Dale Crofts, Simon Casey
To contact the reporter on this story: Brett Foley in London at bfoley8@bloomberg.net; Firat Kayakiran in London at fkayakiran@bloomberg.net
To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

NEW YORK (Reuters) – Recent options activity on shares of Mirant Corp (MIR.N) suggests traders were anticipating a substantial move in the stock prior to the announcement that Mirant would acquire a rival power company.

Mirant jumped 18.9 percent to $12.76 on Monday, one day after it agreed to take over RRI Energy Inc (RRI.N).

The merger will create one of the largest U.S. independent power producers during what has been a rough time for energy companies as recent signs of economic recovery have not resulted in a commensurate recovery in power markets.

For details, see [ID:nN11158137]

RRI Energy shares were up nearly 13.9 percent to $4.50.

Both stocks rallied on Friday ahead of the deal’s announcement, with Mirant gaining 3.9 percent and RRI rising 5.3 percent.

Options market activity shows investors were expecting something to happen with Mirant, even if it was unclear what, as options investors took new bets on big moves in Mirant while RRI Energy didn’t see major options play.

“We have been seeing unusual volume for weeks” on Mirant, said Jon Najarian, a founder of web information site optionMonster.com. “The rumor has been out there for a long time.”

The most active options on the underlying stock were the April $15 calls and June $15 calls while the put interest was very low, Najarian said.

Some options traders seemed to be betting on higher volatility in the shares.

“Options activity on this stock has been especially active since last week, but they (the bets) are for a more longer dated options, and the merger news is one catalyst that certainly doesn’t hurt,” said Jud Pyle, chief investment strategist at Options News Network, a division of option marketing firm Peak6 Investment in Chicago.

Pyle said heavy buying action occurred in Mirant options on Wednesday with a block of roughly 5,000 January 2011 $10 straddles traded.

The total premium was about $3.25 per straddle, a bet on volatility that requires the investor to buy a call and a put option at the same strike price and expiration date. The buyer is looking for significant movement in either direction in the stock. The implied volatility on Mirant shot up to 42 percent compared to the stock’s 30-day historical volatility of 30 percent.

A total of 5,369 January 2011 $10 calls and 5,122 puts at the same strike were traded, according to option analytics firm Trade Alert.

Pyle said investors who bought these straddles will make money if the shares drop below $6.75 or rally higher than $13.25 prior to the January 2011 options expiration, suggesting they are banking on volatility to kick in. (Editing by Padraic Cassidy and Leslie Adler)

FOXBusiness – Regulatory setbacks caused nuclear power company Entergy Corp. (ETR: 81.55, -0.71, -0.86%) to cancel a spin-off of several power plants, the company said Monday.

Entergy said that efforts put forth for the sale will cost more than $75 million in charges that will be reflected in this quarter’s earnings. Total charges will range from 40 cents to 45 cents per share, and will fall somewhere between $75.7 million to $85.1 million.

The planned spinoff included six reactors, three of which would have been sold to New York-based Enexus Energy. However, the New York Public Service Commission rejected Entergy’s proposal and said the plan was not “in the public interest.”

CALGARY – Fort Chicago Energy Partners LP (TSX:FCE.UN) announced Monday that it plans to acquire a 33-megawatt hydro-electric power generation plant in upstate New York, just south of Lake Ontario, for US$80 million.

Through a subsidiary, Fort Chicago will acquire 100 per cent of the plant’s owner, Northbrook New York, LLC., with the transaction to be financed from existing bank facilities.

The acquisition is expected to close in the first quarter of 2010, subject to certain conditions including approval from U.S. federal and New York state authorities.

Fort Chicago said it intends to explore opportunities to have longer-term sales contracts. It’s currently sold its power under two-year contracts.

Fort Chicago is a publicly traded limited partnership based in Calgary. It has interests in two pipeline systems, a natural gas liquids extraction business and power generation plants in several Canadian provinces and U.S. states.

Units of Fort Chicago were up six cents at $9.71 in early trading on the Toronto Stock Exchange.

BEIJING (AP) – China says it is aiming for a big boost in energy efficiency by cutting carbon dioxide emissions per unit of gross domestic product by up to 45 percent by 2020.

The announcement from the State Council, or Cabinet, comes ahead of next month’s Copenhagen climate summit, which aims to produce a new global climate change treaty to replace the 1997 Kyoto Protocol.

The State Council said it “is a voluntary action taken by the Chinese government based on its own national conditions and is a major contribution to the global effort in tackling climate change.”

China announced earlier Thursday that Premier Wen Jiabao will take part in the Copenhagen meeting.

SHANGHAI (Dow Jones) – China’s State Grid Corp. said last week that it had developed its own sodium-sulfur battery for large-scale energy storage applications, marking the entry into that market of a major energy player.

Large-scale energy storage has recently become a focus for clean-technology investors, because large-capacity batteries can help smooth out the intermittent power supplied by renewable sources such as wind and solar.

With State Grid’s debut in the market, start-ups and established players now have a very large, very experienced manufacturer with which they will potentially contend for business in a field full of early-stage technologies.

“Energy Storage is becoming more important and it is very exciting to see State Grid really driving it,” said Yong Zhang, a clean-technology practice partner with Qiming Weichuang Venture Capital Management (Shanghai) Co. “They may give different technology [and] solutions a share in their first batch of trials.”

State Grid didn’t respond to a request for comment about its battery storage work.

One investor with knowledge of the battery industry said that there’s no certainty that the state-owned enterprise can develop this technology to the point of manufacturing it on a commercial scale. He described the company’s efforts as more like a research and development project.

He said that several companies with large-scale storage technologies are working in partnership with State Grid on bringing the technology to the market.

In addition to its reputation as one of China’s two grid-management companies in charge of overseeing the distribution of power for most of the country’s population, State Grid is also China’s largest manufacturer of electrical equipment, which means it has an established manufacturing base.

Currently, the premier manufacturer of sodium-sulfur batteries is the Japanese company NGK Insulators Ltd. (5333.TO), which is currently selling its batteries for pilot projects with a number of utilities worldwide. For example, Columbus, Ohio-based American Electric Power Co. (AEP) has been using a sodium-sulfur battery from NGK Insulators at a site in Charleston, W.Va., to determine the capabilities of the technology.

But a number of other companies are looking to unseat it with new technologies. For instance, Fairfield, Conn.-based General Electric Co. (GE) invested approximately $100 million to build a battery research facility in Niskayuna, N.Y., that will conduct research into sodium-sulfur batteries.

Venture investors have also stepped into the breach – with a trio of some of the biggest and most active firms in the U.S. staking money on battery plays in North America and China. Draper Fisher Jurvetson has backed the China-based Prudent Energy Inc., while Intel Capital has put its money behind the Chinese power company NetPowerTech Co.; VantagePoint Venture Partners has invested in the large-format North American battery manufacturing company Premium Power Corp.

These companies all have different technologies, but for all of them their target market is the utility sector. And with the money China is spending on building out its infrastructure, it could make a tempting place to try and plant a flag for a fledgling business.

Other technology developers, such as publicly traded, Watertown, Mass.-based A123 Systems Inc. (AONE) and Shenzhen, China-based BYD Co. (1211.HK) think that the utility market represents another opportunity for their lithium-ion battery technology, which has traditionally been seen as a more suited energy storage technology for the automotive industry.

The U.S.-based think-tank the Electric Power Research Institute has proposed that utility markets could complement the work that companies like A123 Systems have done in the transportation sector, using lithium-ion batteries.

Lithium-ion battery manufacturer Valence Technology Inc. (VLNC) is working with two European power and transmission companies, National Grid PLC (NGG, NG.LN) and Red Electrica de Espana, to develop large-scale batteries for utility grids, Clean Technology Insight reported previously.

However, some utility executives aren’t convinced that battery technology will provide viable storage. Fong Wan, senior vice-president of energy procurement at San Francisco-based utility Pacific Gas & Electric Co., speaking at the Dow Jones Alternative Energy Innovations conference held last week in Redwood City, Calif., said he hadn’t “seen any successful battery technology on the wholesale level.” PG&E, he said, is investigating adding more pumped storage technology and looking into using compressed air for storage.

Even though State Grid is the biggest game in China when it comes to the power market, industry observers said that competition from the company doesn’t mean that China is necessarily closed to other vendors.

“Chinese companies will take the best technology out there,” said Jonathan R. Woetzel, a director in the Shanghai office of consulting company McKinsey & Co.

(Dow Jones Clean Technology Insight covers news about public and private clean-technology and alternative-energy companies.)

-By Jonathan Shieber, Dow Jones Clean Technology Insight