Roger S. Conrad

Erratic economic growth and sinking energy prices have made investment in solar power an unexpected upside catalyst for US electric utilities’ earnings growth. Two days after closing the sale of its remaining gas- and coal-fired merchant plants, Duke Energy Corp (NYSE: DUK) announced plans to install 500 megawatts of solar power in Florida. This announcement followed on the heels of Duke Energy investing $225 million in REC Solar Commercial Corp—a deal that made the North Carolina-based utility an instant player in distributed electricity. The company also plans to roll out 720 megawatts of solar-power capacity in the Carolinas. Dominion Resources (NYSE: D) owns almost 25 gigawatts of nuclear and thermal power plants and operates more than 33,000 of natural gas pipelines. The utility has 400 megawatts of solar-power capacity under development in Virginia and another 744 megawatts across seven other states. Meanwhile, Sempra Energy (NYSE: SRE) and Southern Company (NYSE: SO) reportedly have contemplated forming yieldcos to finance their renewable-energy plans. NextEra Energy (NYSE: NEE), the nation’s leading producer of wind and solar energy, demonstrated the appeal of this structure with the market’s reception of NextEra Energy Partners LP (NYSE: NEP). For the same investment, utility-scale solar-power plants produce more than four times the electricity output by residential rooftop systems and twice as much as commercial distributed generation. Utilities’ existing customer relationships also give them a huge leg up in marketing rooftop solar-power systems. These realities put money-losing SolarCity Corp (NSDQ: SCTY), Vivint Solar (NYSE: VSLR) and other would-be usurpers at a huge competitive disadvantage. But the growth opportunity in solar power is great news for a utility sector contending with slackening electricity demand and pushback on rate increases. Read more about these risks and opportunities in my Special Report, Renewable Energy: How to Make Green and Avoid Red.

Now more than ever, scale and a low cost of capital are critical to success in midstream energy. This company has both in spades.

We examine how the stocks picked for each month’s Conservative and Aggressive Spotlights have fared since Conrad’s Utility Investor launched in August 2013, kicking the tires on a few underperformers and highlighting names that could be ripe for taking a partial profit.

Don't get caught out by surprise. Here's the latest on potential dividend cutters.

Income-seeking investors have a lot on their minds these days. Here’s our take on topics that are of chief concern to our readership and our portfolio strategy.

The latest addition to our Aggressive Income Portfolio boasts a long history and, more important, a bright future.

Rising concerns about the Federal Reserve raising interest rates have started to push utility stocks back to reasonable valuations. Here's a winning strategy for playing offence during periods of elevated volatility and uncertainty.

SolarCity Corp has become the face of solar power in the US. But a charismatic CEO and disruptive business model aren't enough to paper over the company's dismal financial results.

We've added two new stocks to our model Portfolios

The lowest US unemployment rate in seven years has sparked speculation that the Federal Reserve will raise interest rates sooner than expected, giving traders a convenient excuse to sell dividend-paying stocks. Arguments can be made for and against the Fed raising interest rates. On one hand, the federal funds rate continues to hover near zero, and the central bank has long cited 5.5 percent unemployment as a prerequisite for gradually normalizing monetary policy after a period of extraordinary accommodations. On the other hand, inflationary pressure remains negligible. Hiking interest rates would also propel the Uncle Buck even higher, undermining the nascent revival of US manufacturing and the finances of many developing-world economies. Misjudging which course of action the Federal Reserve will take won’t ruin your portfolio. However, rashly selling your dividend-paying stocks doesn’t make a lot of sense; future returns for utility stocks, master limited partnerships and telecom stocks won’t depend on the US central bank’s next move.