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First Solar (FSLR) Inks Long-Term PPA With Cleantech Solar
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First Solar, Inc. (FSLR - Free Report) recently announced that it has signed a 15-year power purchase agreement (PPA) with Cleantech Solar. Per the agreement, Cleantech Solar will build 150 megawatts (MW) of photovoltaic (PV) solar and 16.8 MW of wind capacity in India's Tamil Nadu.
Details of the Deal
Once fully commissioned, by third-quarter 2024, the solar and wind generation assets of Cleantech Solar are expected to supply around 7.3 gigawatt-hours (GWh) of power to First Solar's new 3.3 GW solar manufacturing plant in Tamil Nadu. This will cover up to 70% of the facility’s anticipated electricity needs.
Per the agreement, Cleantech Solar has agreed to procure 150 MW of advanced, India-made Series 7 thin film solar panels from First Solar and will utilize them to power the solar PV component of the PPA, with the modules expected to be delivered in the first half of 2024.
First Solar’s Prospects in India’s Solar Market
First Solar is steadily gaining momentum in India’s solar market. It commenced production of Series 7 modules at its first manufacturing facility in the country. The facility demonstrates 12,000 module/day capability and a top module wattage of 535.
Looking ahead, First Solar expects 10.9 GW of total opportunities in India’s solar market, including 3.8 GW of mid-to-late-stage opportunities. The solar plant in Tamil Nadu, located in an area of high baseline water stress, is considered to be the world’s first net-zero water withdrawal solar manufacturing facility. Additionally, it marks India’s first PV solar recycling plant.
Such endeavors are likely to provide meaningful gains to the company in the days ahead, which can be further gauged by a recent projection by Mordor Intelligence. Per this report, India's solar market was estimated to be at 79.07 GW by the end of 2023 and is projected to reach 195.11 GW by 2029, registering a CAGR of 19.8% during 2024-2029.
In light of such growth expectations and the recent agreement, it is reasonable to assume that First Solar’s expansion plans in India could prove to be prudent, potentially enhancing its revenue generation prospects in the region.
Peer Moves
Apart from First Solar, other prominent players like Enphase Energy (ENPH - Free Report) and Canadian Solar (CSIQ - Free Report) are also expanding their footprint in India.
Enphase Energy already has a manufacturing facility in Chennai, Tamil Nadu. On Oct 16, 2023, the company started shipment of IQ8 Microinverters, with peak output AC power of 480 watts, in India to support high-powered solar modules.
ENPH has a long-term (three-to five-years) earnings growth rate of 18.3%. The stock boasts an average earnings surprise of 11.97% in the last four quarters.
Canadian Solar has a strong presence in the Asia-Pacific region, which contributed 12% to the total revenues during third-quarter 2023. The region, excluding China and Japan, had 2,226 megawatt-peak solar development project pipeline as of Sep 30, 2023.
The Zacks Consensus Estimate for CSIQ’s 2024 sales implies a rise of 19.9% over the previous year's figure. The stock boasts an average earnings surprise of 67.89% in the last four quarters.
Price Performance
Over the past year, shares of FSLR have gained 6.1% against the industry’s 39.4% decline.
A better-ranked stock in the same industry is Nextracker Inc. (NXT - Free Report) , carrying a Zacks Rank #2 (Buy).
NXT has a long-term earnings growth rate of 35.2%. The Zacks Consensus Estimate for fiscal 2024 sales implies a rise of 23.2% over the prior-year’s reported figure.
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First Solar (FSLR) Inks Long-Term PPA With Cleantech Solar
First Solar, Inc. (FSLR - Free Report) recently announced that it has signed a 15-year power purchase agreement (PPA) with Cleantech Solar. Per the agreement, Cleantech Solar will build 150 megawatts (MW) of photovoltaic (PV) solar and 16.8 MW of wind capacity in India's Tamil Nadu.
Details of the Deal
Once fully commissioned, by third-quarter 2024, the solar and wind generation assets of Cleantech Solar are expected to supply around 7.3 gigawatt-hours (GWh) of power to First Solar's new 3.3 GW solar manufacturing plant in Tamil Nadu. This will cover up to 70% of the facility’s anticipated electricity needs.
Per the agreement, Cleantech Solar has agreed to procure 150 MW of advanced, India-made Series 7 thin film solar panels from First Solar and will utilize them to power the solar PV component of the PPA, with the modules expected to be delivered in the first half of 2024.
First Solar’s Prospects in India’s Solar Market
First Solar is steadily gaining momentum in India’s solar market. It commenced production of Series 7 modules at its first manufacturing facility in the country. The facility demonstrates 12,000 module/day capability and a top module wattage of 535.
Looking ahead, First Solar expects 10.9 GW of total opportunities in India’s solar market, including 3.8 GW of mid-to-late-stage opportunities. The solar plant in Tamil Nadu, located in an area of high baseline water stress, is considered to be the world’s first net-zero water withdrawal solar manufacturing facility. Additionally, it marks India’s first PV solar recycling plant.
Such endeavors are likely to provide meaningful gains to the company in the days ahead, which can be further gauged by a recent projection by Mordor Intelligence. Per this report, India's solar market was estimated to be at 79.07 GW by the end of 2023 and is projected to reach 195.11 GW by 2029, registering a CAGR of 19.8% during 2024-2029.
In light of such growth expectations and the recent agreement, it is reasonable to assume that First Solar’s expansion plans in India could prove to be prudent, potentially enhancing its revenue generation prospects in the region.
Peer Moves
Apart from First Solar, other prominent players like Enphase Energy (ENPH - Free Report) and Canadian Solar (CSIQ - Free Report) are also expanding their footprint in India.
Enphase Energy already has a manufacturing facility in Chennai, Tamil Nadu. On Oct 16, 2023, the company started shipment of IQ8 Microinverters, with peak output AC power of 480 watts, in India to support high-powered solar modules.
ENPH has a long-term (three-to five-years) earnings growth rate of 18.3%. The stock boasts an average earnings surprise of 11.97% in the last four quarters.
Canadian Solar has a strong presence in the Asia-Pacific region, which contributed 12% to the total revenues during third-quarter 2023. The region, excluding China and Japan, had 2,226 megawatt-peak solar development project pipeline as of Sep 30, 2023.
The Zacks Consensus Estimate for CSIQ’s 2024 sales implies a rise of 19.9% over the previous year's figure. The stock boasts an average earnings surprise of 67.89% in the last four quarters.
Price Performance
Over the past year, shares of FSLR have gained 6.1% against the industry’s 39.4% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Pick
First Solar currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A better-ranked stock in the same industry is Nextracker Inc. (NXT - Free Report) , carrying a Zacks Rank #2 (Buy).
NXT has a long-term earnings growth rate of 35.2%. The Zacks Consensus Estimate for fiscal 2024 sales implies a rise of 23.2% over the prior-year’s reported figure.