Company Update (NYSE:GE): General Electric Company Introduces Next-Generation Transformer, Provides Customers Safer Transformer for Urban Applications

Helping to improve safety at urban substations, Prolec-General Electric Company (NYSE:GE) has announced that it has developed a new power transformer that utilizes a synthetic ester liquid instead of traditional mineral oil. Transformers represent the most significant fire safety challenge in electrical substations. By using a less-flammable synthetic ester liquid as a coolant and dielectric insulator instead of traditional oil, the risks associated with a potential transformer fire are significantly reduced. The synthetic ester has a high flash point, which makes it virtually impossible to sustain a fire once the transformer protections interrupt the electrical arc in the event of a fire. In addition, the potential for soil contamination from tank rupture is reduced since the ester is biodegradable. Designed in collaboration with Comision Federal de Electricidad (CFE), Mexico’s national utility company, the new power transformers will be implemented by CFE to help modernize electrical substations across Mexico City and its metropolitan area.

“Fires in transformers can be highly dangerous and devastating to areas in close proximity to the substation. When a transformer fire occurs in indoor substations or densely populated areas, the impact can be amplified exponentially,” said Federico Ibarra, technical manager, CFE. “Safety is of the upmost importance to us at CFE. Our decision to implement Prolec-GE’s new transformers was made with this in mind. Not only will the units reduce the risk of significant fires at our electrical substations, they also will reduce our potential environmental impact and help to modernize our electrical infrastructure.”

Prolec-GE’s project with CFE includes the installation of more than 50 power transformers and will be rolled out in a series of five stages. In the current stage, Prolec-GE is providing:

  • Four 36/48/60-megavolt ampere (MVA), 230/23/15-kilovolt, high-voltage on-load tap-changer (OLTC) power transformers.
  • Four 18/24/30-MVA, 85/23-kilovolt, low-voltage OLTC power transformers.
  • Three 18/24/30-MVA, 115/85/23-kilovolt, low-voltage OLTC transformers.

“This new, innovative solution is without a doubt the result of successful collaborative work between CFE and Prolec-GE,” said Pedro Puente, vice president of Prolec-GE’s Power Transformers business. “The new transformers were designed and developed by a team of engineers at our Advanced Technology Center where we continuously work to develop new solutions to meet and exceed the present and future industry needs.”

The new Prolec-GE power transformers are designed to operate both indoors and outdoors, and will be installed by CFE in the densely populated centers of Mexico City. This urban setting created challenges beyond environmental compatibility, size and weight restrictions. The area’s high population required safety to take center stage, specifically the need to minimize potential fire and explosion risk. With Prolec-GE’s synthetic ester-filled transformers, CFE is able to meet its power needs and reduce the potential transformer fire risk to those close to the substation without experiencing a drop in transformer life expectancy.

CFE serves a population of over 20 million in Mexico City alone. It has been a strategic customer for Prolec-GE for more than 40 years. As a leader in transformer technology throughout Mexico, Prolec-GE has supplied different types of equipment in the region such as generator step-ups, autotransformers, substation transformers, shunt reactors and distribution transformers. Installation of these latest transformers is underway and units are expected to be energized by the end of 2015. (Original Source)

Shares of General Electric opened today at $26.17 and are currently trading up at $26.18. GE has a 1-year high of $28.68 and a 1-year low of $23.41. The stock’s 50-day moving average is $27.06 and its 200-day moving average is $25.71.

On the ratings front, General Electric has been the subject of a number of recent research reports. In a report issued on June 26, William Blair analyst Nicholas Heymann reiterated a Hold rating on GE, with a price target of $30, which represents a potential upside of 14.6% from where the stock is currently trading. Separately, on June 18, Deutsche Bank’s John G. Inch maintained a Hold rating on the stock and has a price target of $29.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Nicholas Heymann and John G. Inch have a total average return of -2.5% and 12.7% respectively. Heymann has a success rate of 37.5% and is ranked #2832 out of 3694 analysts, while Inch has a success rate of 79.2% and is ranked #772.

Overall, 3 research analysts have assigned a Hold rating and 4 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $33.00 which is 26.1% above where the stock opened today.


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