Back to top

Analyst Blog

NRG Energy Inc.’s (NRG - Analyst Report) subsidiary NRG Solar has acquired a solar project from Quantum Utility Generation, LLC’s affiliate Quantum Guam Power Holdings, LLC. The project has a power generation capacity of 25.65-megawatts (MW).

NRG Energy will sell the output to the Guam Power Authority (GPA), the sole electricity utility of the island of Guam, through two 25-year power purchase agreements (PPA). These agreements will help GPA to provide clean and emission-free power to the consumers at a cheaper price.

Both the parties will be benefited from the current project. The GPA is currently relying on fuel oil and diesel to generate power. The project will help the power authority to save more than $300 million as fuel cost with net savings of approximately $100 million. In addition, NRG Energy will be benefited in terms of reducing its dependence on fossil-fuel for power generation.

It is evident from NRG Energy’s recent activities that it is concentrating on expanding its solar portfolio via organic as well as inorganic route.

Recently, NRG Energy announced its plan to set up rooftop solar photovoltaic arrays at MGM Resorts International’s (MGM - Analyst Report) Mandalay Bay Resort Convention Center in Las Vegas. The company will sell the output to MGM Resorts through a long-term power purchase agreement.

As far as inorganic growth strategy is concerned, NRG Energy recently announced that its two solar photovoltaic facilities - Kansas South and TA-High Desert projects - have started commercial operation. The company acquired these two projects having power generation capacity of 20 MW each from Recurrent Energy. NRG Energy will sell the output to Edison International’s (EIX - Analyst Report) unit Southern California Edison and PG&E Corporation’s (PCG - Analyst Report) unit Pacific Gas and Electric Company.

In addition, NRG Energy completed the acquisition of GenOn in Dec 2012. The company has already benefited from it in first-quarter 2013 through an increased realized gross margin in its East segment and expects to realize $150 million of cost and operational synergies in 2013.

We believe the timely implementation of renewable energy ventures along with acquiring new assets and developing and improving existing portfolio would benefit NRG Energy’s future performance.

Princeton, N.J.-based NRG Energy together with its subsidiaries operates as an integrated wholesale power generation and retail electricity company. The company currently has a Zacks Rank #2 (Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%