Bloomberg News

Enernoc Drops on Concern PJM Proposal May Reduce Sales, Margins

January 09, 2012

Jan. 6 (Bloomberg) -- Enernoc Inc., a company that helps utilities reduce power demand during peak hours, dropped the most in more than three months in New York on concerns that rule changes may cut its sales and profit margins.

Enernoc sank as much as 17 percent to $8.55, the biggest intraday decline since Sept. 30. The shares fell $1.46 to $8.90 at 10:16 a.m. Enernoc, based in Boston, had dropped 59 percent in the past year, through yesterday.

Enernoc is paid by utilities to acquire large power users as clients and also for the amount by which it reduces their consumption of electricity.

PJM Interconnection LLC, which operates the largest U.S. power grid, issued yesterday a proposal to the Federal Energy Regulatory Commission that may eliminate these double payments for Enernoc’s demand-reduction services.

The proposed rule, which would require FERC approval, may reduce sales from Enernoc’s largest market, said Carter Shoop, an analyst at KeyBanc Capital Markets Inc. in San Francisco.

“It shows that PJM is playing hardball,” Shoop said yesterday in a note to clients. “If the FERC were to accept PJM’s proposal, Enernoc’s sales and/or margins will be adversely affected.”

Enernoc didn’t immediately reply to phone calls.

--Editors: Will Wade, Stephen Cunningham

To contact the reporter on this story: Christopher Martin in New York at

To contact the editor responsible for this story: Reed Landberg at

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