I bought ITC this morning at $56.04 per share; The number of shares purchased was embarrassingly low, however, it was in compliance with my no gluttony rule (see: I Am A Gluttonous Trader).

I did not purchase this stock for short-term speculation in price movements; I bought into the company, ITC Holdings, because of my views on the importance of electricity for the future energy needs of the United States. Clearly, I am not the only person who is interested in ITC for this reason as evidenced by ITC’s price-to-earnings ratio being nearly twice as high as the industry average; ITC is a growth stock in the utilities industry.

The ITC Great Plains segment is well positioned to take advantage of the influx of investment in the Kansas wind corridor — thank you T. Boone Pickens (joke). Furthermore, I think the feasibility of alternative liquid fuels is a long way off; Electric cars are going to be a dominant theme for a while.

My fears are vastly diminished income due to reduced projects as the U.S. economy continues its decent. Reduced demand coupled with increased fuel costs and regulatory price caps could cripple utilities and their need for growth — which is their need for ITC. Furthermore, with both political parties asserting their obvious genius (sarcasm — I am of the politicians are leeches school of thought), the number of risks are large and not all obvious.

Summing the possibilities — qualitatively anyway — I believe ITC has more favorable futures than unfavorable ones. I believe there are some parallels with the spectacular rise of commodities and the future rise of utilities. There is likely to be a lull (or crash) in electrical demand as the economy sinks but there is enough foresight to keep transmission investments rolling if possible as electrical demand will continue to rise sharply in the intermediate-term (5-10 years). Construction of new transmission lines cannot happen overnight; If you want it for future demand you need to being new projects soon.

Conservation of energy is rational but the path less traveled; Gluttony is one of the seven deadly sins. I’d rather pump my air conditioning then use the electric ceiling fan. People are not going to inflate their tires.