The AES Corporation AES announced that its unit, AES Distributed Energy, Inc., in partnership with ImMODO Energy Services Corporation (ImMODO), will develop solar projects in California. Per the agreement, the two parties will develop four solar PV projects totaling 11.3 megawatts (MW) direct current (DC) across the state, and a 2 MW solar PV project – Lemoore 1 – in the city of Lemoore, CA.
Details of the Project
The four projects will be located in the cities of Delano (1.4 MW), Manteca (1.3 MW) and Bakersfield (7.1 MW and 1.5 MW). They are expected to come on line by Aug 2017. AES Distributed Energy will be the long-term owner and operator of these solar projects, while ImMODO will be responsible for providing design, engineering and maintenance services.
AES Distributed Energy has a 20-year power purchase agreement (PPA) with Pacific Gas and Electric Company, a unit of PG&E Corporation PCG, to provide energy for its Solar Choice program.
Solar Development in California
Electric utilities in California are required to show a 33% share of renewable energy in their total generation mix by 2020. The primary source of renewable energy is expected to be solar as the state has supportive polices and witnesses more sunny days than other parts of the U.S.
Per the California Energy Commission, 1,948.8 MW solar facilities are already operational in the state, in addition to approval for new projects like the ones mentioned above. As per the Solar Energy Industries Association, California is expected to install 20,487 MW of solar energy in the next five years.
AES Corp. has gained 26.8% over the last one year, outperforming the Zacks categorized Utility-Electric Power industry’s gain of 6.8%.
The outperformance was mainly driven by the company’s stable liquidity position, focus on expanding its generation capacity and asset divestment strategy to streamline its portfolio.
Zacks Rank & Key Picks
The AES Corp. currently has a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the same space include NextEra Energy Inc. NEE and DTE Energy Co. DTE.
NextEra Energy currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.. Its earnings surpassed the Zacks Consensus Estimate by 5.4% in the last reported quarter. Its 2016 estimates improved by a penny to $6.22 over the last 60 days.
DTE Energy also holds a Zacks Rank #2. The company’s earnings surpassed the Zacks Consensus Estimate by 27.3% in the last reported quarter. Its 2016 estimates improved by a penny to $5.27 over the last 60 days.
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