Rising distributions with limited risk are what set apart MLP Profits Conservative Holdings. We focus on master limited partnerships (MLP) that own and operate energy infrastructure, such as pipelines and storage facilities that generate a steady stream of fees.

Cash flow is therefore not vulnerable to ups and downs in energy prices. And the best increase it over time by building and buying more pipelines and facilities, which in turn fuels distribution growth.

Unit prices can be volatile in a particularly bad market, such as we saw from the fall of Lehman Brothers last September up until the market’s early March bottom. But over time, adding valuable assets boosts unit prices, even as distributions continue to pile up.

We started our Conservative Holdings with three charter members: Enterprise Products Partners (NYSE: EPD), Kinder Morgan Energy Partners (NYSE: KMP) and Sunoco Logistics Partners (NYSE: SXL). All three focus on energy infrastructure and have steadily grown operations, cash flow and distributions year after year. All three remain strong buys.

This week, we’re adding Spectra Energy Partners (NYSE: SEP), the MLP that was partially spun off from Spectra Energy (NYSE: SE) in mid-2007. Spectra, which owns a portfolio of energy infrastructure and commodity-related businesses throughout North America, is the general partner and owns 84 percent of the MLP.

Spectra is doubly incented to grow the MLP’s cash flow and therefore distributions. And by placing its more stable cash generators in the MLP–mainly pipelines and storage centers–it’s able to shelter more of the resulting cash flow from taxes, and pass more of it along to itself and other unitholders of the MLP.

As a much larger entity with solid access to capital, Spectra is also ideally placed to acquire energy infrastructure assets and pass them through to the MLP. In April, for example, Spectra announced a deal to purchase the NOARK Pipeline from troubled Atlas Pipeline Partners (NYSE: APL) for $300 million. It then immediately “spun down” the assets to Spectra Energy Partners in a deal that’s expected to immediately add to the MLP’s cash flow and will increase distributions by another penny as share a quarter when it closes in second quarter 2009.

NOARK is a key asset linking the prolific Fayetteville Shale area to energy markets. That should ensure some major “scaling up” opportunities, basically low-risk opportunities to increase fee-generating potential such as the MLP has in other areas.

Other assets include the East Tennessee Natural Gas system, a 1,500-mile pipeline system in the Southeast with throughput of 1.5 billion cubic feet (bcf) per day. The Saltville Gas Storage system has 5.5 bcf capacity adjacent to that system in Virginia.

The MLP also owns 24.5 percent of the Gulfstream Natural Gas System, a 745-mile system connecting the Alabama coast to central Florida, along with a 50 percent interest in the Market Hub Partners gas storage cavern.

The MLP has increased its distribution every quarter since its 2007 spinoff. Overall, the payout is up 12.1 percent over the past year. It was covered by a margin of approximately 1.1-to-1 ratio in the first quarter.

First quarter results demonstrate the underlying strength of the business, as cash flow available for distribution–the best measure of MLP profits–increased 24 percent. Management also held to its full-year 2009 guidance for further growth in revenue, cash flow and distributions.

The MLP currently yields about 7 percent and trades at approximately 1.4 times book value and slightly below initial public offering price of 22.

Spectra Energy Partners is a buy up to 24.