With "power" … or the "lack thereof" being on most people's mind rights now, it's apropos that this week's sector focus is on publicly traded utilities, (a.k.a. power producers) throughout the globe. Much like air, electricity isn't really missed … until you don't get any. Only then do we realise how dependent we are on it.

With traditional power sources like, nuclear, coal and other fossil-fuelled turbines accounting for much, if not most, of the world's energy, alternative energy sources continue to be just that, an alternative. However, the last few decades have been nothing short of revolutionary for the utility space, Enron aside. Alternative power producers have come of age and have begun to show some real promise both in their ability to produce cheap and efficient power and gain the public's acceptance.

The advances in solar, water, wind, bio-mass and fuel cell technology have forced traditional power producers/suppliers to stand up and take notice, (or more likely stand-up and take financial stakes in the companies themselves). Conglomerates like GE, British Petroleum, and General Motors have all thrown their hats into the alternative-energy ring, the philosophy being "if you can't beat 'em, invest in 'em". Here are some of the movers and shakers in the alternative energy space:

FPL Group (NYSE: FPL) Last $63.00

FPL Energy is the utilities subsidiary of the FPL Group, a company whose yearly revenues surpass $8 billion. FPL Energy is among the US's most disciplined unregulated wholesale generators and are leaders in producing electricity from clean and renewable sources. Among its cutting-edge energy products, FPL is the largest generator of wind energy in the United States and also operates the two largest solar fields in the world. In recent news, FPL unveiled its Wyoming wind farm plan. The project will comprise 80 wind turbines capable of producing 144 megawatts or enough to power 43,000 homes. Financially speaking, the group expects to earn $4.80 to $5 per share in 2003. Overall 2002 total shareholder return was 11 percent verses the S&P 500's negative 22 percent returns. In FPL's ability to harness the wind, they have also been able to realise their windfall profits!

Plug Power (NASDAQ: PLUG) Last $5.12

Plug Power Inc. designs, manufactures and markets proton exchange membrane (PEM) fuel cells for stationary applications, unlike fuel cell rivals Ballard Power (BLDP) and Fuel Cell Energy (FCEL) who use this technology primarily to power vehicles (cars, buses, aircraft and ships).

Plug has strategic partnerships with several leading public companies in an effort to make this cutting edge technology viable and affordable for mass consumption. GE Fuel Cell Systems, DTE Energy Technologies, Vaillant GmbH, Honda R&D Co, and Engelhard Corp. are but a few of the names Plug was working in tandem with. Most recently, Plug was awarded $3.9 million from the National Institute of Standards and Technologies (NIST) to forge ahead with fuel cell R&D.

Financially speaking, Plug recently released its second quarter earning with revenue for this quarter totalling $3.1 million.

Net cash position for the company remains strong at $10.8 million, however, earnings per share continue to be negative, at -21 cents per share versus -24 cents for the same period in 2002. A negative earnings scenario is the norm for cutting edge companies like Plug Power whose sole focus is on R&D and not profitability. Thus, it isn't too surprising that R&D expenditures account for the bulk of Plug Powers' spending and totalled $13.8 million for the second quarter.

Progress Energy (NYSE: PGN) Last $43.20

Sure to have felt the strength of Hurricane Isabel, Raleigh, North Carolina-based Progress Energy said it had taken all necessary storm precautions and assured its 2.8 million customers that "the lights will turn on" in the aftermath.

Although not a common household name like Microsoft, GE or IBM, Progress Energy is a member of the prestigious Fortune 250 list of most distinguished and successful US companies.

In addition to its utility programme, Progress Energy also comprises non-regulated operations covering merchant generation, energy marketing, natural gas exploration, fuel extraction, rail services and broadband capacity. Environmentally, Progress is committed to promoting energy efficiency and offers homes custom built with solar photovoltaic (PV) systems to its Palm Harbor, Florida customers.

Progress Energy's North Carolina customers have the option of choosing the statewide "NC Green Power" environmental programme which supplies them with electricity from renewable resources such as solar, wind, bio-mass and hydro-electricity.

From an investment standpoint, Progress last paid a quarterly dividend of .39 cents, which equates to a 5.59 percent dividend yield. Estimated earnings per share (EPS) are due to come in at $3.65 for 2003. Buyers can expect to pay about 11 times price to earnings (PE) which is fairly to slightly overvalued for the utility sector as a whole. Overall, Progress scores very favourably as a value stock having built its reputation on EPS growth and profitability. This all while keeping in touch with its' customer base and allowing them access to renewable energy sources of the future.

Gavin Davis is an investment advisor at LOM. He can be contacted at 294-7006 or via email at gavin.davis@lom.bm