An analysis of the nuclear decommissioning trusts of listed utilities — based on SEC annual report filings — revealed significant year-over-year gains in assets. Total NDT assets increased 12.2% to $34.8 billion for the 10 companies with the most in NDT assets. Actual asset allocations were mostly unchanged among the 10, with the average allocation to equities increasing slightly to 51.3% from 50.1%. The average fixed-income allocation had a 3.8 percentage-point decrease to 43.5%.
Exelon Corp. noted a shift in its fixed-income strategy “During 2012, the NDT fixed-income portfolio completed its transition from solely core fixed-income investments to a blend of Treasury inflation-protected securities …, investment-grade corporate credit and middle-market lending. “
Other recent NDT asset allocation news includes the Public Utilities Commission of the state of California allowing Southern California Edison Co., San Diego Gas & Electric Co. and Pacific Gas and Electric Co. to modify the asset allocations of their NDTs. The commission raised the cap on total equity exposure to 80% from 60%, raised the cap on international equity to 30% from 20% and authorized the investment in below-investment-grade fixed-income securities (although the average credit quality of the portfolio requirement was unchanged). The commission did not authorize the inclusion of alternative investments, but would consider allowing alternative investments if a utility applies and demonstrates it has “both experience with institutional investing and sufficient staff support.”
Data Editor Tim Pollard contributed to this post.