Nicor Cites "Real Potential" for Illinois Electric Business

During an earnings call, Nicor said that it sees "real potential" for its new electric commodity marketing business in Illinois, which is conducted pursuant to a marketing agreement with Dominion Retail.

Asked by an analyst during an earnings call regarding the Illinois electric market, Nicor Inc. CEO Russ Strobel noted that the retail electric business, launched in July, "is just getting off the ground now."

"So I think it's too early to offer any prognostications on where that business is going to go, but Illinois is a market where the regulation and the politics are all very much in favor of a competitive market at the residential level, at the retail level. So we think there is real potential there," Strobel said.

Nicor's other energy ventures segment, which includes wholesale marketing as well as its retail energy services and bill management businesses, reported lower operating income of $1.7 million for the three months ended September 30, 2011, versus operating income of $7.1 million a year ago.

The reduction was attributed to lower operating income at the company's wholesale natural gas marketing business, with no cited changes for the retail energy businesses versus the year-ago.

For the nine months ended September 30, 2011, operating income at the other energy ventures segment was lower at $15.6 million, versus $22.9 million a year ago. For the nine months ended September 30, 2011, Nicor said that reduced wholesale results were partially offset by higher operating income at the company's retail energy-related products and services businesses.

The improved retail energy operating income for the first nine months of 2011 was attributed to lower operating expenses, partially offset by lower operating revenues. Lower operating expenses were attributable to lower average cost per utility-bill management contract resulting from lower average natural gas prices. Lower operating revenues were due to lower average revenue per utility-bill management contract, attributable to lower average natural gas prices, partially offset by higher average contract volumes.