Wisconsin Energy Corporation generates and distributes electric energy. The company operates in two segments, Utility Energy (91% of revenue) and Non-Utility Energy (9% of revenue). It generates electricity from coal, natural gas, oil, hydroelectric, wind, and biomass. The company provides electric utility services to customers in the paper, foundry, food products, and machinery production industries, as well as to the retail chains. It also provides retail gas distribution services in the state of Wisconsin, as well as transports customer-owned gas to paper, food products, and fabricated metal products industries; and generates, distributes, and sells steam. In addition, the company invests in and develops real estate, including business parks and other commercial real estate projects primarily in southeastern Wisconsin. The company was founded in 1981 and is headquartered in Milwaukee, Wisconsin.
US nonresidential construction spending
The value of US nonresidential construction spending, a demand indicator for electric utilities, rose 7 percent year-to-date in July 2014 compared to the same period in 2013. Nonresidential construction spending slipped in August, according to an Oct. 1 release from the U.S. Census Bureau. Nonresidential construction spending shrank 1.2 percent on a monthly basis in August, but has still managed to expand 6 percent on a year-over-year basis. Spending for the month totaled $603.7 billion on a seasonally adjusted, annualized basis.
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US personal income
US Personal income on average has increased 0.3% on a seasonally adjusted- month over month rate over the past couple years. We saw a brief moment of disruption due to the fiscal cliff towards the beginning of 2013.
Value of US residential construction spending
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Page 3 Wisconsin Energy Corporation NYSE: WEC Construction spending over the past 2 years has gained substantial traction and is at its highest levels since June 2008.
Total US demand for electric power generation
Growth of electricity demand (including retail sales and direct use) has slowed in each decade since the 1950s, from 9.8%/year from 1949 to 1959 to only 0.7%/year since 2000. Electricity demand growth remains relatively low, as rising demand for electric services is offset by efficiency gains from new appliance standards and investments in energy-efficient equipment. Total electricity demand grows by 29%.
Electricity demand varies with different assumptions about economic growth, advances in energy-efficient technologies, and electricity prices. In the High Economic Growth case, electricity demand grows by 41% from 2012 to 2040, compared with 20% in the Low Economic Growth case and only 14% in the Best Available Demand Technology case. In the High Oil and Gas Resource Case, a 2% decline in electricity prices from 2012 to 2040, because of greater natural gas availability, results in demand growth of 35% over the same period. In contrast, in the Reference Case, electricity prices increase by 13% over the projection, while demand increases by 29%.
US Industrial Production
U.S. industrial production fell in August for the first time since January, the latest sign of uneven improvement in the economy. Industrial production, which measures the output of U.S. manufacturers, utilities and mines, fell 0.1% in August from the prior month, the Federal Reserve said Monday. July's Fall 2014
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Page 4 Wisconsin Energy Corporation NYSE: WEC increase was revised down to 0.2% from 0.4% and August capacity utilization fell 0.3 percentage point to a 78.8% rate.
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DISCLAIMER This report is prepared strictly for educational purposes and should not be used as an actual investment guide. The forward looking statements contained within are simply the authors opinions. TUIA STATEMENT Established in honor of Professor William C. Dunkelberg, former Dean of the Fox School of Business, for his tireless dedication to educating students in real-world principles of economics and business, the William C. Dunkelberg (WCD) Owl Fund will ensure that future generations of students have exposure to a challenging, practical learning experience. Managed by Fox School of Business graduate and undergraduate students with oversight from its Board of Directors, the WCD Owl Funds goals are threefold: Provide students with hands-on investment management experience Enable students to work in a team-based setting in consultation with investment professionals. Connect student participants with nationally recognized money managers and financial institutions
Earnings from the fund will be reinvested net of fund expenses, which are primarily trading and auditing costs and partial scholarships for student participants.