Duke Energy Renewables, a unit of Duke Energy Corporation (DUK), has completed the acquisition of two commercial solar power projects, namely, Highlander Solar 1 and 2 for an undisclosed amount. The company has purchased the projects from SolarWorld.
The project developer, SolarWorld, has been engaged in the engineering, procuring, and building of the project after purchasing the sites in May 2012. The projects comprise of 100,188 SolarWorld Sunmodule solar panels that are installed on its Suntrac single-axis trackers. SolarWorld intends to complete the construction in the second quarter of 2013, with the project coming online thereafter.
Located near Twentynine Palms, Calif., both the projects will run as a single operation as it is located almost next to each other. Together, Highlander Solar 1 and 2 will generate 21 megawatts (“MW”) of renewable energy which is sufficient to power more than 4,000 average homes every year. Under a 20-year purchase power agreement, all the electricity generated from the two projects will be sold to Edison International (EIX).
Post completion, the project will be the largest operating crystalline-silicon solar installation in Calif. Besides enlarging its footprint in a key U.S. renewable market, the project will enable the state in meeting their renewable energy goals by providing affordable, zero-emission solar power. By 2020, the state is committed to generate 33% of the electricity from sources like wind, solar, geothermal, biomass, and small hydroelectric facilities.
Since 2007, Duke Energy has invested more than $2.5 billion to grow its commercial wind and solar business. Including Highlander, Duke Energy has 15 U.S. solar farms with a total generation capacity of more than 100 MW.
Charlotte, N.C.-based Duke Energy is a diversified energy company with a portfolio of domestic and international, natural gas and electric, regulated and unregulated businesses, which supply, deliver, and process energy for customers in North America and selected international markets.
Duke Energy focuses on core utility operations to build its rate base through capital expenditure investments. Additionally, the company is proactively and effectively mitigating long-term environmental-related risks through investment plans and constructive dialogue with policymakers. These factors have in fact propelled the company to attain its 52-week high price on Apr 8, 2013.
However, we remain concerned about the present unfavorable macro backdrop, predominantly fossil-fuel based generation assets, tepid demand for electricity and a few pending regulatory cases.
The company presently retains a short-term Zacks Rank #3 (Hold). Stocks worth considering are Huaneng Power International, Inc. (HNP) and Pike Electric Corporation (PIKE), both with a Zacks Rank #1 (Strong Buy).
More From Zacks.com