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Ameren (AEE) Arm Buys Wind Farm, Proceeds With Net-Zero Goal

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Zacks Equity Research
·3 min read
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Ameren Corporation AEE recently announced that its unit Ameren Missouri has acquired a 400-megawatt (MW) High Prairie Renewable Energy Center wind project in northeast Missouri. This is part of the company’s planned inorganic route investment, which will add 700 MW of clean energy to the existing portfolio. It will acquire a 300-MW energy center in Atchison County, MO and then complete the $1.2-billion acquisition investment.

Clean Energy Plan

Ameren has committed to become a net-zero carbon emission company by 2050 and formulated a plan to achieve the target.  The company’s initial target is to lower carbon emissions by 50% and 85% by 2030 and 2040, respectively, from 2005 levels. It finally aims to achieve net-zero carbon emissions by 2050. Its emission reduction target is in sync with the objectives set in the Paris Agreement that are aimed to control the global temperature rise caused by emissions.

Ameren plans to achieve the above goal by investing $4.5 billion by 2030, which will add 3,100 MW of solar and wind power generation to its portfolio. The company plans to add 2,300 MW in the next 10 years, which will take the tally to 5,400 MW in 2040.

In addition to making acquisitions and setting up new clean energy-based power projects, it is also shutting down coal-fired electricity generating units. Ameren aims to retire 75% of coal-based generation units by 2039 and retire all coal-based units by 2042.

Ameren will evaluate and pursue other clean energy options without compromising on delivering 24/7 electricity to customers in an affordable manner.

Visible Change in Utility Space

Utility operators in the United States have decided to invest in projects that are emission less or produce a very minimum emission to produce electricity. Countries across the globe are working on finding ways to lower expenses for developing utility scale renewable power projects, and finding new techniques as well as processes to make clean energy affordable for users.

Utilities are continuing to make investments in renewable energy sources and for the development of offshore wind projects. Usage of hydrogen to produce electricity and the development of battery storage units is making electricity from clean energy sources more reliable.  

Similar to Ameren Corporation, utilities like Duke Energy DUK, DTE Energy DTE and Xcel Energy XEL, among others, have already laid out plans to attain net-zero emission goals by 2050.

Price Performance

In the past six months, the company has returned 11.5% compared with the industry’s rally of 7.8%.

Zacks Rank

Ameren currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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