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Has anyone seen what kV rating the line was that they reconductored?
If someone has the DD time & resources ...
All the major wind turbine manufacturers have set up manufacturing/assembly in the US. I would be interested to know what the lead time is and the costs associated with setting up such facilities.
Also, Clipper Wind is a new mfr trying to get manufaturing/assembly established in IA. The same cost/time question would be relevant. Clipper is a good example to use. As a new technology, they have struggled to get their first contracts. Equity in wind projects don't like technology risk.
All that to say, I'd like to see if they know how long this takes and how much money the'll need to invest before the sales are there.
Yep. This design never flew because of the guide wires. They claim to have a new concept that doesn't need guide wires.
They also had designs for a simple power pole that has still not materialized. It was originally meant to be part of the Kingman project but they are now using wooden poles since CTC couldn't deliver.
This whole deal sounds like Bill Arrington's work. Lots of cool ideas but I wonder how much of substance is behind it. The wind turbine market is becoming dominated by manufacturers with large balance sheets (GE, Seimens, Mitsubishi, etc.) Equity investors in wind projects don't like companies without a balance sheet to support their product (Clipper for example - their recent IPO was an attempt to capitalize their business for this purpose). For DeWind to be successful they will need a significant capital boost.
Which all leaves me wondering why CTC is putting money into something like this at this stage, unless it is coming from some outside source specific to this venture.
I'm glad I'm not the only one scratching my head on this deal. Where is the funding coming from? This does nothing to sell ACCC cable and dilutes management focus on what amounts to another startup opportunity. And if they can't produce simple poles for Kingman, how are they going to start making composite tower for wind turbines?
I'm disappointed that this is the PR we are getting and not ACCC sales announcements. Hopefully the next few months will bring better news.
The long awaited China news!
COMPOSITE TECHNOLOGY ANNOUNCES 30 KILOMETER SALE OF ACCC CABLE IN CHINA AND BEGINS TESTING
IRVINE, CA, July 6, 2005 - Composite Technology Corporation (CTC) (OTC Bulletin Board: CPTCQ), a leading developer of high-performance composite core cables for electric transmission and distribution lines, today announced the sale of 30 kilometers (approximately 18.6 miles) of its Aluminum Conductor Composite Core ("ACCC") cable to it's Chinese partner Jiangsu Far East Group Limited, for installation in Jiangsu Province.
The Chairman of the board of Jiangsu Far East, Jiang Xi Pei said, "We are delighted to be working with CTC and are confident that its ACCC technology will play a vital role in helping to meet the growing demand for the transmission of electricity in China. We believe that this installation will quickly lead to very significant sales. The ACCC cable will very effectively address many of the problems which contribute to scheduled blackouts and related congestion. We see a huge demand for ACCC in both new construction and in the upgrading of existing lines.
CTC also announced the commencement of testing of its ACCC cable at the Electric Power Construction Research Institute ("EPCRI") and Shanghai Research Institute of cable. They are both leaders in the electric power design field in China. They will test the ACCC conductor cable over a 30 day period to confirm certain safety and reliability minimums required under Chinese law.
You Chuan Yong, Senior Engineer at Electric Power Construction Research Institute said, "We fully expect that CTC's cable will meet all of the testing requirements in a timely manner and will help China meet the demands of its electrical power distribution."
In 2004, China had the worst power shortage since the blackouts of the 1980's, which led to power outages in 24 of the country's 27 provinces and in some of China's biggest cities. To meet the demand for improving the transmission of electricity in China, the State Grid Corporation of China, which controls the transmission of electricity in 22 provinces, may spend 107 billion Yuan ($13 Billion U. S. Dollars) building and repairing power lines in 2005. In addition, China Southern Power Grid Co., the smaller of the two state electricity distributors, may spend 30.5 billion Yuan ($3.7 billion U.S. Dollars) this year building and repairing grids and laying nearly 3,000 miles of power lines.
Benton Wilcoxon, CEO of Composite Technology Corporation, stated, "We are pleased to have established a presence in the dynamic China market in which State Grid has estimated an annual transmission and distribution expenditure in excess of $16 billion per year. As the developer of ACCC, the most advanced and cost effective transmission cable in the industry, we see tremendous opportunity to grow our international business while making a meaningful contribution to the robust Chinese economy. Acceptance of our technology within China will allow the economy to expand without the challenges of scheduled power outages which disrupt industry and impact commerce."
CTC's ACCC cable can increase, up to 100%, the current carrying capacity over existing transmission and distribution systems, which can allow an immediate increase in the power transmission within an existing power corridor, without building a new corridor. Furthermore, ACCC can dramatically increase system reliability by virtually eliminating high- temperature sag, thereby offering significant benefits to electric utility companies and ultimately to their industrial, commercial and residential customers.
About Jiangsu Far East Group Limited
Jiangsu Far East Group Limited, located in Yixing City, Jiangsu, China, is the leading manufacturer of electrical transmission and distribution cable in China, which it sells to the regional power grids within China and some countries around world.
About the State Grid
Established on the basis of enterprises and institutions formerly owned by State Power Corporation of China, State Grid Corporation of China (SG) is a special large-sized enterprise approved by the State Council to operate the business of power transmission, transformation, distribution and other assets of power grid. As a pilot state-holding and authorized investing Corporation by the State Council, whose leading group is under the administration and management of the Central Government directly, SG operates in such a manner that the president, is responsible for all major activities. At present, there are 728 thousand employees working for SG.
About CTC
Composite Technology Corporation is an Irvine, California based company providing high performance composite core conductor cables for electric transmission and distribution lines. The novel proprietary ACCC cable is superior to existing conventional conductor products of the same diameter in a number of key performance areas, including:
Up to double the current carrying capacity of conventional cables
Virtually eliminates high-temperature sag
Uses conventional installation methods and tools
Reduces construction costs on new lines by requiring fewer structures
May be retrofitted on existing structures to increase current capacity
Non-corrosive core; no bi-metallic corrosion
Reduces line losses compared to same diameter conventional cables at same temperatures
CTC is establishing strategic relationships with existing cable manufacturers for production of its ACCC cable to facilitate deployment utilities worldwide. More information can be found at www.compositetechcorp.com or by contacting James Carswell, Director of Investor Relations, at 760-416- 8628.
This is probably all EDF could do at this stage. However, they will be the main customer in this deal. They have huge needs for this product as noone in France wants new transmission lines built but their system is getting very overloaded. They've been testing ACCC for a while. Again - this industry takes time, but this will produce a lot of revenues over teh next few years.
Craps - many thanks for posting these summaries. Helps those of us who don't have time to keep up with this stuff.
It's part of a daily industry email newsletter I receive - Energy Central Professional. I don't have a web site link but the article originated with Electric Perspectives on May 24th.
Growth in Transmission Investment
Some commissioners on the Federal Energy Regulatory Commission (FERC) wonder whether electric companies are building enough transmission facilities. Part of FERC's concern is that a lack of transmission investment might constitute an exercise of vertical market power-electric companies might use lack of investment as a way to protect their generation. If FERC determined this, then market-based rates for some transmission-owning companies would be at risk.
But statistics about transmission planning are surprisingly difficult to get: Many companies look on their five-year plans as competitive information. Still, a March study of shareholder-owned electric utilities shows that investment has grown and will continue to grow. (The response rate to the study-conducted by Edison Electric Institute-was 90 percent.) From 1999 to 2003, annual transmission investment by shareholder-owned utilities increased 12 percent annually and totaled $17 billion. (See Figure 1.) From 2004- 08, the responding utilities have invested or are planning to invest $29 billion, more than a 60-percent increase over the earlier period. Combined actual and planned investment over the entire period increases 10 percent annually.
Also, planned investment in 2004 was about 10 percent of net book value of all transmission assets.
Here's an interesting post from RB - I'm just pasting it here to make it easier to read - any thoughts on this?
Here's an e-mail from a very large shareholder in the company. I also have a substantial holding in the company but am not connected to them in any other way. Thought some good info might help at this point.
If you didn’t know, CTC filed for reorganization under Chapter 11 bankruptcy today. This was done to allow the company to continue to pursue their business without financial threat from litigation. CTC negotiated up until last night with the litigants but they refused to accept a reasonable offer.
Before I go any further you need to know you will keep your shares, no change at all here. They will not pull a K-Mart.
As for myself, this was a real shock. For what it’s worth I was buying the last couple of days (ooops!). Will I buy tomorrow, probably not. I am not selling.
I have spoken with Benton Wilcoxon, Chairman & CEO. He has assured me everything published regarding the Chapter 11 filing is as stated. He has spoken with a number of their largest investors, none are selling, and there are some who intend to buy quite a bit tomorrow.
Key points from the filing:
It’s voluntary.
The bankruptcy is motivated solely to resolve several litigation matters.
Given the unknown consequences of litigation which might have shut down the company, they sought protective measures.
Their strategic partners have indicated their continued support – General Cable was very supportive of this move.
CTC submitted a plan of reorganization along with the filing – which will include no change in the ownership of stock. This should be public tomorrow.
The company believes the claims are extortionate and given the proper venue they will prevail.
CTC’s current financial condition will allow them to operate normally – the Chapter 11 filing freed up their cash for business, not litigation.
Here is my somewhat educated view of the most potentially damaging litigation, CTC vs. Acquvest and Tarbox vs. CTC. I have been aware of the Acquvest scam for a couple of years and no one thought their cross-complaint would be taken seriously. At the end of this message I included the case information provided in the CTC quarterly public statement if you care to wade through the details.
In April 2003 CTC had a private offering of .25 per share.
Acquvest (4 people, mainly Paul Koch) subscribed for $375,000 which would be paid over time based on CTC achieving certain goals. The agreement was later amended to include additional shares at the same price. They paid $125,000 up front.
When CTC reached their goals Acquvest didn’t pay.
CTC filed suit for breach of contract in October 2003.
Aqcuvest cross filed in October of 2004.
One of the people in Aqcuvest, Tarbox, filed suit against the other people in Acquvest and CTC.
It turns out Koch and his group were not accredited (didn’t have the funds and didn’t meet the asset level required by the SEC to invest in a 144 stock offering). Koch got money from Tarbox to buy the shares and was subsequently sued by Tarbox to get the shares.
Koch is now on his 4th attorney, and has racked up fees of $450,000.
Sounds messy, well it is!
Things were going OK for CTC and they assumed they would prevail, Aqcuvest twice filed motions to tie up CTC assets and they were denied.
They filed for a third time to attach assets and were successful in mid-April.
CTC filed an emergency appeal and lost.
They continued to negotiate a settlement up until last night but the other party was very unreasonable, looking to get over $10,000,000 from the company.
Faced with a trial next week and an unfavorable judge, they decided to file Chapter 11 to protect their assets and move forward with business.
This moves them out of a provincial court and into federal court. CTC’s attorneys are pleased with the judge who will handle these cases.
Here’s my bottom line, disregarding share price, and the stigma of Chapter 11, the company is in a better position to market, sell, and manufacture their products than they were last week. They are very close to several of their first no-strings-attached commercial orders with major utilities.
COMPOSITE TECHNOLOGY CORPORATION V. ACQUVEST (OCSC CASE NO. 03 CC 12640):
On October 16, 2003, CTC filed suit against Acquvest, Inc., Paul Koch, Victoria Koch, Patricia Manolis, and Michael Tarbox in Orange County Superior Court. CTC alleges causes of action for declaratory relief, breach of contract, fraudulent inducement, rescission and economic duress arising out of certain subscription and related agreements among the Company and the defendants. In connection with such agreements, CTC issued to Acquvest, Inc. and Patricia Manolis, in April 2003 and September 2003, a total of 150,000 units for a total purchase price of $375,000. Each unit consists of 10 shares of unregistered, restricted common stock and 10 Series I warrants to purchase one share of unregistered, restricted common stock. Each Series I warrant entitles the holder to purchase a share of common stock at $0.50 per share and expires on March 30, 2005. The agreements provide for the issuance of up to an additional 550,000 of such units for the same purchase price of $2.50 per unit, subject to certain conditions, and registration of share issuances under the Securities Act of 1933. The additional units have not been issued and the additional purchase consideration has not been paid. The parties disagree as to their respective rights and obligations with respect to the original issuances and such additional units. 10,000 units were also issued to Paul Koch for services in connection with such agreements, and a dispute has arisen as to his entitlement to those and additional units and warrants in connection with the agreements. CTC is seeking actual damages, punitive damages, statutory costs, attorneys' fees and injunctive relief against the defendants. CTC also seeks rescission of the pertinent agreements based on numerous grounds, including fraudulent inducement. By a letter to CTC's counsel dated September 8, 2004, Acquvest stated that it was waiving the contractual conditions to its purchase of an additional 400,000 units under its subscription agreement and was tendering $1,000,000, which was available on deposit, to CTC as payment for the units. Acquvest, Koch, and Manolis filed a Cross-Complaint on September 16, 2004, which they amended per stipulation on December 17, 2004. On April 14, 2005, CTC was served with notice that the Court granted defendants and cross-complainants' application for Writs of Attachment allowing for the attachment of CTC's assets totaling $2.55 million. The Court had denied two prior applications by defendants and cross-complainants for Writs of Attachment. CTC immediately filed a Notice of Appeal on April 14, 2005 and an Emergency Writ on April 18, 2005 with the California Courts of Appeal to challenge the Court's decision to grant the Writs of Attachment and to stay the Writs of Attachment. Additionally, CTC is working to arrange to post the bond to stay attachment of the entire amount subject to the Writs of Attachment. CTC believes that the Court committed reversible error by granting the Writs of Attachment and intend to vigorously seek to reversal of the order. Trial date has been set for May 9, 2005.
MICHAEL TARBOX V. COMPOSITE TECHNOLOGY CORPORATION, ET AL.
Michael Tarbox ("Tarbox") filed this action on October 13, 2004 in Orange County Superior Court (Case No. 04-CC-10345) against Paul Koch, Acquvest, CTC and Doe Defendants. Tarbox alleges that Koch made fraudulent transfers to Acquvest and the Doe defendants for the purpose of avoiding the debt owed to Tarbox. Tarbox alleges that CTC securities were intended to serve as security for a debt owed by Koch to Tarbox. Tarbox alleges that Defendants were not bona fide purchasers of the CTC securities since they were receiving such securities for the benefit of Tarbox. Tarbox further alleges that CTC breached an agreement to pay him a finder's fee in connection with investments made by Koch. Tarbox alleges that CTC's breach has caused him to suffer damages in excess of $750,000. CTC denies Tarbox's material allegations. On November 14, 2004, CTC filed a demurrer to the Complaint. Tarbox filed a First Amended Complaint. CTC filed an Answer to the First Amended Complaint.
Many of the posts are asking for updates. I agree - it is sales we want, not updates on in-process deals.
While I agree with all that news of sales is what we need, I'm not sure what else management could have said in the way of PR regarding pending deals that are not real yet - especially China.
A few months ago, everyone was complaining that the press releases were not of enough substance (i.e. not real sales). Now everyone is complaining that we are not getting releases on pending deals (i.e. PR without substance).
Everyone will be much happier when the sales happen, but I can't fault management for not giving us blow-by-blow on negotiations that are in process.
I fully agree. I'm very long on CPTC. Anyone who knows this industry knows it doesn't make sales in a day. All of these test installations and the General Cable deal will build momentum for the credibility of the cable. I think we will see some sales this year of significance, but it will be the year after and beyond that things will really take off, IMO.
Patience, patience. It sounds like many of our posters are not very familiar with the electric utility industry. These deals take a very long time. A six month delay is a quick deal in this industry.
I know management has indicated that the China deal is there for the taking and they are the ones delaying for a better deal, but I take that with a grain of salt. I think they are still waiting for the Chinese place an order with them, and are still negotiating the structure of the deal.
This is the kind of stock you want to be in for a few years. We all got spoiled with the rise late last year, but we will see it again when the sales start happening, and this time it will be a substantive and enduring rise based on results, not speculation.
As William Wallace yelled to his me as the English troops bore down on them.. "Hold! Hold!"
cws9 - I'm fairly sure CTC has met with KCPL before. They recently had a reconductoring project to deal with a flow gate issue south of KC. Unfortunately, they were too far down the path to consider ACCC then.
cws9 - can you say who you spoke with at KCPL?
This could also give CTC the opportunity to design and file for patents on their fittings. That way they can get a revenue stream from the manufacturer as demand grows.
Thanks Monks - excellent job
Elektro
The company has discussed the Kansas "green line" project for about a year or two. I would rate this as a long shot, but you never know. There are just so many hurdles to get over to get something like that built.
Regarding the second manufacturing facility, I believe that they 'promised' the City of Kingman a facility (maybe just for poles) as part of the deal. Latest I heard, that is still a few months from coming together.
Incentives can, and probably will, mean rate of return guarantees for utilities. This is not a tax via the Feds but rather via ratepayers who pay their electricity bills. The only thing holding utilities back from spending on transmission infratructure is that they have no way of knowing if and how they get repaid for the investment. It's a long story why, but suffice to say - the money is there as soon as FERC or some other means opens the way for a guarantee of ROE.
EP - do you know the nature of this JV? It looks like it was done prior to the current CTC management being in place. Does anyone know is CTC still has a strong position in the JV relative to Strongwell?
I can't verify this, but it appears that CTC and this company are working together on the composite pole. See this story:
http://www.cerf.org/about/press/8_21_99.htm
My thoughts exactly.
I do not understand the thinking that says we are better off not being in China. I agree with your rationale, but even if there were real problems with IP theft, what is better - to get no revenues or market expansion at all by avoiding China, or milk the revenues from China for as long as you can and make money before they rip you off? It would also help open up other Asian markets.
Again, I don't believe the paranoia is valid anyway, but I can't think why anyone would say to not sign an agreement with the Chinese.
There's a good chance that this is posturing on environmental issues to help China's cause in joining the World Bank, etc.
I agree that these projects are unlikely to be help up long. The enviro group just wants then to pay more attention to their concerns. There's no way China is going to let the 3 gorges project fail with all they have invested in it.
Len
Good post - you might want to copy this whole thing over to the RB for those still deciding. It shows the benefits well.
Let's see if we can get the rest over from RB this week.
Len and RB-ers
I agree. RB is clunky. How can we get the main group to move over?
Ditto - checking out the IH board. So far so good.