JinkoSolar Holding Company Ltd. (JKS - Free Report) recently announced that it has supplied 275.4 Megawatt-dc (MWdc) high-efficiency solar modules to Green Light Contractors Pty Ltd. These modules will be installed in Australia’s Bungala solar project.
Details of the Project
The Bungala solar photovoltaic (PV) plant, with a generation capacity of more than 200 MW, is one of the largest solar farms in Australia. The plant aims to generate 23.5% energy from renewable sources by 2020.
The Bungala project has two phases, with total estimated cost of $315 million. While its first 137.7 MWdc phase has started production, the rest of the operations are projected to commence by the third quarter of 2018.
Australian Government’s Initiatives for Clean Energy
Realizing the need to reduce greenhouse gas emissions, the government of Australia has been undertaking various initiatives to expand renewable generation portfolio. The country’s Clean Energy Regulator, post the seventh Emissions Reduction Fund auction, allocated more than $2.29 billion fund toward renewable energy.
Solar is the least expensive option for alternative power generation, courtesy of lower cost of installation compared with most fossil fuel-powered generators. This along with improved technology, large number of panel installations and government initiatives will boost the solar market in Australia. We believe that the latest deal will enable JinkoSolar to reap benefits from the expanding Australian solar market. Further, the company expects to receive more such orders from Australia.
Prospects in Global Solar Market
The global renewable energy industry has witnessed significant growth in the last several years. Realizing the need for a cleaner environment, consumers have rapidly adopted alternative energy sources. A key area of the renewable space is solar energy. With demand for solar energy rising, leading players are also expanding their contracts worldwide.
JinkoSolar is following this similar trend. Recently, the company announced that its U.S.-based subsidiary has entered into a three-year agreement with sPower — an affiliate of AES Corp (AES - Free Report) — to supply 13 gigawatt (GW) high-efficiency solar modules. In March, JinkoSolar signed an agreement to supply 2.75 GW of modules to NextEra Energy (NEE - Free Report) . These contracts indicate the growing popularity of JinkoSolar’s modules in the global solar market.
JinkoSolar’s shares have lost 32.1% in a year against the industry’s rally of 21.3%. The downside might have been caused by stiff competition in the solar market.
Zacks Rank & Key Pick
JinkoSolar currently carries a Zacks Rank #4 (Sell).
A better-ranked stock in the same industry is SolarEdge Technologies, Inc (SEDG - Free Report) . The stock holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SolarEdge Technologies Holdings delivered an average positive earnings surprise of 29.11% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has risen by 7.5% to $3.31 in the last 90 days.
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