Frequently Asked Questions
Q. Do you see ongoing opportunities for investors in the electric and gas utility industry?
A. Yes. The energy sector has gone through a period of considerable consolidation, diversification and financial leveraging. What follows will be a period of restructuring finances and portfolios. On behalf of its investment partners, HPC expects to find and take advantage of opportunities during this time of transition and change in the energy industry.
Q. Can you describe your ideal investor client?
A. Energy utility assets require investors desiring a long term "hold" position in a sector that can generate significant cash dividends in a relatively low risk environment. This investment profile fits many institutional-type investors that need to maintain a balanced risk, and diversified portfolio combined with a fair amount of liquidity.
Q. Why should HPC be a critical part of an investor's strategy in the energy sector?
A. Energy utility assets -- especially electric and gas distribution and transmission -- create a significant challenge for non-traditional investors. Most investors have limited experience with utilities outside of large public stock utility companies. HPC assists investors in understanding opportunities in the energy delivery sector and the regulatory environment they operate in.
Q. How so?
A. First, HPC can bring forward attractive opportunities that it pre-screens by using personal contacts and available financial data. Second, HPC understands how to efficiently close transactions requiring a variety of regulatory approvals and to set up the operations for those assets to enable profitability afterward. Third, HPC has the requisite management expertise to assist the investor in ensuring the asset meets its financial objectives by actively managing the energy asset.
Q. Can you give me an example of how your team managed an energy asset efficiently?
A. Over a four-year period our team, working at a major utility, we achieved several important goals. We deployed a sophisticated asset management process that helped prioritize expenditures to focus primarily on customer requirements. This kept the operating budget flat and reduced capital expenditures by approximately 15 percent, while absorbing wage increases. During the same time period we also deployed $250 million worth of infrastructure investments, creating higher operating efficiencies.
Q. Why is HPC uniquely positioned to be your partner of choice?
A. HPC pro-actively develops opportunities, deploys a systematic approach to transferring the operating properties for new ownership and installs a proven management model for highly regulated businesses. All of this enables an investor to see a transaction close quickly and efficiently and with a high degree of confidence it will reach its financial objectives. Additionally, HPC is a minority-owned business, an attractive feature for some investors.
Q. What other areas in energy can HPC provide value to the investor?
A. Renewable energy opportunities will continue to expand, requiring understanding electric supply management, transmission operations and power purchase contracting. We bring necessary expertise to evaluate and structure investment opportunities in these areas.