If you want a way to offset those large electricity and gas bills, one way you can do that is by investing in the infrastructure, pipeline and power retailers.
Here are three multi-billion dollar utilities paying dividend yields above 6%.
Spark Infrastructure Group (ASX: SKI) is a $2.3 billion company and holds a 49% interest in three electricity distribution networks, SA Power networks in South Australia and CitiPower and Powercor in Victoria. The three companies serve close to 2 million customers including some of Australia's largest companies, public transport systems and sporting venues. Spark is expecting to pay a distribution of 11.5 cents per security, putting it on a unfranked dividend yield of 6.2%, a rise of 4.5% over the previous year. Dividends have risen consistently over the past four years, suggesting further consistent growth in the years ahead.
SP AusNet (ASX: SPN) owns an electricity transmission and distribution network across Victoria, as well as a gas distribution network in central and western Victoria. The company expects to pay 8.36 cents per share this financial year, partly franked to 33%, which equates to a dividend yield of around 6%. Like Spark, SP AusNet has steadily increased dividends, thanks to net profit growing more than 8% each year over the past five years. Much of SP Ausnet's revenues are regulated, but are still expected to grow around 7% each year through to 2016, which is likely to result in steadily growing dividends.
DUET Group (ASX: DUE) is a $2.8 billion company, with its major assets comprising a 80% in the Dampier Bunbury gas pipeline, 66% of United Energy – an electricity distribution network in south-east Melbourne and the Mornington Peninsula, and Multinet Gas Group Holdings, a gas distribution network in Melbourne. DUET is also working on two gas pipeline projects, one for Fortescue Metals Group (ASX: FMG) and the other for the giant Wheatstone LNG project. DUET continues to grow dividends, with this year's dividend expected to be 17 cents per share, equating to a dividend yield of 7.8% (unfranked).
Foolish takeaway
Infrastructure companies like these can be good companies to own as defensive assets. After all, even in a recession, people still need electricity and gas power.
