PPL Supply Unit Earnings Higher on Market Rates

PPL Corp.'s Supply unit reported higher earnings of $281 million for the fourth quarter of 2010 versus $52 million a year ago.

The gain was largely from significantly higher sales prices for Eastern baseload generation, due to the expiration of the PPL Electric Provider Of Last Resort contract at the end of 2009. Higher hedged prices established over the past few years, lower income taxes, and lower operation and maintenance costs also lifted earnings.

For the fourth quarter of 2010, PPL EnergyPlus supplied 2,246 GWh of retail sales, compared to 9,164 GWh a year ago. The total for the fourth quarter of 2010 excludes 5,458 GWh supplied by LG&E and KU Energy LLC for the two months following the November 1, 2010 acquisition of the Kentucky utilities which PPL included in the metric. The 2009 quarter included POLR sales to PPL Electric Utilities. During an earnings call, executives said that PPL does not have any significant load-following positions in Pennsylvania under any load-following contracts, including at PPL Electric Utilities.

Unregulated retail electric and gas revenues were $94 million for the fourth quarter of 2010, versus $44 million a year ago.

Contrary to other published reports, PPL did not report on an earnings call Friday that only 288,000 of customers had migrated to a competitive supplier (which is the total from early 2010).