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Duke Energy (DUK) Starts Building 120-MW Solar Plant in Idaho

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Duke Energy (DUK - Free Report) recently announced that its commercial brand, Duke Energy Sustainable Solutions, started constructing the Jackpot Solar project in Twin Falls County, ID. With a generation capacity of 120 megawatts (MW), this solar plant is projected to start commercial operation by the end of this year.

Once operational, this solar facility will put Duke Energy a step ahead in reaching its goal of 47,000 MW as a renewable provider by 2050.

Post completion, the Jackpot Solar plant, representing Duke Energy’s first utility-scale renewable energy project in Idaho, will become the state’s largest solar plant.

Prospects in Idaho

On being operational, the Jackpot solar plant will provide energy to Idaho Power through a 20-year power purchase agreement. To this end, Idaho Power, a subsidiary of IDACORP (IDA - Free Report) , involves the generation, transmission and distribution of electricity in Idaho. Currently, it is working toward its Clean Today, Cleaner Tomorrow goal of providing 100% clean energy by 2045.

Undoubtedly, this Jackpot plant to be constructed by Duke Energy will boost Idaho Power in duly achieving its aforementioned clean energy goal. Considering Duke Energy’s already proven expertise in renewables having reached more than 10,000 MW of solar and wind energy as a clean energy provider in 2021, we may witness more such utility-scale renewable plant construction by the utility, thereby boosting the top line,

Duke Energy’s Clean Energy Initiatives

Since 2005, Duke Energy has lowered sulfur dioxide emissions in Indiana by 96%, nitrogen oxide emissions by 73% and carbon emissions by 42%. During the next 20 years, the company plans to add about 4,525 megawatts of solar power, 400 megawatts of energy storage and 2,800 megawatts of wind energy, apart from cleaner natural gas generation.

The Jackpot plant is part of this renewable energy expansion target set by Duke Energy. 

Utilities’ Adoption of Renewable Energy

Utilities are adopting renewable energy sources to produce electricity to mitigate the deadly effects of climate change in the United States. Per the latest forecast made by the U.S. Energy Information Administration (EIA), electricity generation from renewable energy sources is expected to rise from 20% in 2021 to 23% in 2022 and 24% in 2023, primarily driven by projected additions to the wind and solar energy generating capacity.

Apart from Duke Energy, other utilities have pledged net-zero carbon emissions to achieve a carbon-free environment to benefit from the growing renewable generation opportunities.

For instance, DTE Energy (DTE - Free Report) is committed to reducing the carbon emission from electric utility operations by 32% by 2023, 50% by 2030 and 80% by 2040 from the 2005 levels. To meet carbon reduction goals in the near term, DTE Electric plans to put in service a natural gas-fueled combined-cycle generation facility in 2022.

DTE Energy boasts a long-term earnings growth rate of 6%. DTE came up with a four-quarter average earnings surprise of 8.97%.

Likewise, American Electric Power’s (AEP - Free Report) intermediate goal is an 80% reduction from 2000 CO2 emission levels from its generating facilities by 2030. The long-term goal is net-zero CO2 emissions from its generating facilities by 2050. Its 2022-2026 capital investment forecast includes $9.9 billion in a regulated renewables plan.

American Electric boasts a long-term earnings growth rate of 6.2%. AEP has a trailing four-quarter earnings surprise of 2.40%, on average.

Price Movement

In a year-to-date time, shares of Duke Energy have gained 5.9% compared with the industry’s growth of 1.6%.

 

Zacks Investment Research
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Zacks Rank

Duke Energy 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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