Our weekly ESG impact tracker explores recent headlines from the Electric Utilities sector regarding energy grid investments. In particular Xcel Energy bets big on electric vehicles, but they're not alone as peers are making their own moves.

Bennett Saltzman
August 26, 2020

ESG Spotlight: Xcel Energy’s Bold Vision for the Next Decade

ESG Spotlight: Xcel Energy’s Bold Vision for the Next Decade

In a previous ESG Spotlight we discussed BP and their commitment to a cleaner future. BP topped our NLP platform’s ESG tracker in early August as the company pledged to a 40% reduction in oil and gas production by 2030, while increasing low carbon fuel production tenfold. Following this trend in clean energy, we continue our analysis this week by highlighting Xcel Energy and their commitment to be a major player in electric vehicle charging. 

First, some context. On August 12th Tesla announced a five-for-one stock split. Since that announcement, their stock price has increased by 35%. The market is clearly betting that the future of cars is electric, and funds are flowing to Tesla and a new collection of pre-earnings EV companies that have been gobbled up by SPACs. However, EVs still only make up less than 5% of global car sales, and in order to see that number rise there is a consensus that equal investment in our energy grid is essential.

Betting on Electric Vehicles

Last Thursday Xcel Energy (XEL:US) announced that it plans to power 1.5 million electric vehicles by 2030. This announcement propelled Xcel towards the top of our Electric Utilities Industry Clean Technology Impact Tracker, and is evidence of their continued commitment to reduce fossil fuel consumption as well as increase renewable energy use.

Amenity's ESG Impact Tracker: Clean Technology Top 10

To help achieve this goal the company pledged $300 million towards infrastructure improvements across Colorado, New Mexico, Wisconsin, and Minnesota. Xcel has exhibited steady growth throughout its history and its stock up 15.96% over the past 12 months.

Sector Moves

Xcel Energy is at the vanguard of a new age in automobile transportation. Just as the gas station made the internal combustion engine king of the American highways, charging stations this century aim to do the same for electric vehicles. Xcel Energy rolling out this new plan is a blueprint for all utilities players to follow suit and invest in regional infrastructure to capture a new customer base and save consumers money. All the while creating a cleaner future.

To emphasize this point we used our ESG tracker to shine the spotlight on a few of Xcel’s peers who also made it into our top ten this month:

  • Duke Energy (DUK:US) abandoned the Atlantic Coast Pipeline and laid out a plan to fill in the energy gap by building utility-scale solar and modernizing the grid in the Carolinas over the next three years
  • Iberdrola (IBE:ES) partnered with Fertiberia to build one of the largest electrolytic hydrogen production systems in the world
  • Avangrid (AGR:US) announced an agreement to build a 200 megawatt wind farm that will supply enough energy to power over 60,000 homes
  • PG&E (PCG:US) teamed with Tesla to build a new battery energy storage system at an electric substation in California as they work to enhance overall electric grid efficiency and reliability

There is an increasingly clear divergence between these top performers in this industry and some of the companies that are lagging behind in the shift towards an electric grid. If you want to read more about the other companies on this list shoot us a message.

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About Amenity

Amenity Analytics is the industry leader in providing insights from unstructured text by using Natural Language Processing (NLP) assisted by Artificial Intelligence (AI) and Machine Learning (ML). Amenity’s NLP system is a sector-agnostic, language-dependent tool for quantitative text analysis that is deployed across the financial services industry and beyond.

This communication does not represent investment advice. Transcript text provided by FACTSET and S&P Global Market Intelligence.

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