ABB to Power Rome, Shares Up - Analyst Blog

Shares of ABB Ltd. ABB increased 1.5% on March 28, following the company's announcement of receiving a contract from a leading Italian multi-utility firm – ACEA (Azienda Comunale Elettricità e Acque) – for developing a smart electricity distribution system in parts of Rome.

Prior to this, ABB and ACEA had joined forces to conduct a series of experiments on portions of electrical grids in Rome to gain deeper insight into requirements of low and medium voltage products in the city. 

This contract requires ABB to provide medium voltage products including advanced UniSec switchgear for smart grid applications that would result in an improved and a consistent distribution network.

UniSec is designed to meet the increasing challenges in a modern electrical plant. Also, ABB's Relion protection relays that are incorporated in UniSec, control, measure and supervise the whole power system. The complex system integrates the current and voltage sensors for a smooth transmission from primary to secondary distribution substations.

This system is based on the G.O.O.S.E. (Generic Object Oriented Substation Event) control model that is compliant with the international IEC61850 standard to enable monitoring and control of the substations from a remote control center over a wireless network.

The smart grid distribution systems prove to be a boon for electricity consumers as these are adept in minimizing service interruptions, outages and the average cut-down periods significantly. Thus, it not only meets increasing requirements of large urban cities but also reduces negative impacts on the environment in an attempt to create a sustainable future.

ABB currently holds a Zacks Rank #4 (Sell). However, other stocks in the power sector that are worth considering at the moment are Quanta Services Inc. PWR, Franklin Electric FELE and Enersys Inc. ENS, all of which carry a Zacks Rank #2 (Buy).