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Avista (AVA) Files Electric IRP, Focuses on Clean Energy

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Avista Corp.’s (AVA - Free Report) operating division Avista Utilities, recently filed an Electric Integrated Resource Plan (IRP) for 2017 with the Washington and Idaho public utility commissions. The IRP is a 20-year plan to cater to the needs of customers by providing them a source of safe and cost-effective energy.

The recently filed IRP is in sync with the company’s strategy of meeting customers’ energy demands by 2026, which it intends to achieve through adequate resources and controlled generation contracts.

Details of the Plan

The company submits an electric IRP with the authorities every two years containing the details regarding projected growth in energy demand along with new resources required to serve customers over the next 20 years.
Per the latest IRP, Avista’s existing generation resources are cost effective and reliable enough to meet the needs of customers over the next 20 years. Additionally, the company is going to develop of a 15 megawatt MW (DC) solar facility for its commercial and industrial customers.

Outcome of 2017 IRP

Avista’s projected greenhouse gas emissions associated with the generation portfolio in this IRP is 29% lower than the projected greenhouse gas emissions as identified in the 2015 IRP. Along with this, the company’s current energy storage costs are also significantly lower than the last IRP, per the current IRP plan.

Additionally, the company anticipates customer load growth to decrease to 0.5% in the 2018-2037 IRP timeframe, replacing the 0.6% projected growth in the 2015 IRP. The company currently derives more than 50% of total generation capacity from hydro, wind and biomass renewable sources. Given Avista’s focus on generating more electricity from renewable sources, we expect renewable energy contribution to increase further from the present level.

With the help of the new IRP, the company aims to add newer solar resources and additional renewable options to cater to the needs of its customers. Taking into consideration the above factors, the company seems well poised to fulfill the customers’ needs along with balancing environmental responsibility.

Price Movement

In the past year, Avista has outperformed the industry. During this period, the company’s shares gained 31.3% compared with the industry’s loss of 11.8%.

This can be attributed to the company’s strong financials which enable it to execute investor-friendly measures at regular intervals.

Zacks Rank & Key Picks

Avista currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the same spare are Pattern Energy Group Inc. (PEGI - Free Report) , Ameren Corporation (AEE - Free Report) and CenterPoint Energy, Inc. (CNP - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Pattern Energy delivered an average positive surprise of 59.21% in the trailing last four quarters. The company’s 2017 estimates increased significantly form a loss of 10 cents to earnings of 27 cents in the last 90 days.

Ameren delivered an average positive surprise of 2.83% in the trailing last four quarters. The company’s 2017 estimates increased by 3 cents to $2.80 in the last 90 days.

CenterPoint delivered an average surprise of 10.34% in the trailing four quarters. The company’s 2017 estimates increased by 3 cents to $1.31 in the last 90 days.

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