The AES Corporation (AES - Free Report) announced that it has a goal to reduce carbon emission by nearly 70% through 2030 (revised its prior goal of 50% reduction from a 2016 baseline) for achieving its stated renewable growth plans.
Also, the company’s subsidiary sPower recently acquired Idaho solar 1 project with an operating capacity of 55 megawatt (MW). The plant is located in Kuna County, ID. The company focuses on both organic and inorganic growth opportunities to expand its renewable energy portfolio.
AES Corporation’s Focus on Renewable
The company looks set to target the growing need for renewables and is looking forward to extend its renewable footprint. To this end, the company’s Alto Maipo hydroelectric project in Chile is 70% complete as of September 2018 and is expected to begin commercial operations in the second half of 2020. On beginning of the operation, we may expect this hydroelectric plant to substantially boost the company’s renewables portfolio.
As of September 2018, the company signed nearly 1.9 gigawatts of renewable PPAs including projects under construction, taking the total to 5.7 gigawatts. Currently, the company aims to assign 2-3 GW of new PPAs annually for 2019 and 2020. This would result in 7.5 GW of new renewable PPAs being signed through 2020, all of which would be online by 2022.
Importance of Renewable
Renewable Energy source has been gaining momentum globally. Wind and solar power have been two of the fastest growing sources of electricity generation on the international front over the past decade. Per a latest release from the U.S. Energy Information Administration (EIA), solar generation in the United States will rise 26.4% from 212,000-megawatt hour per day (MWh/d) in 2017 to 268,000 MWh/d in 2018 and increase 13.1% to 303,000 MWh/d in 2019.
Moreover, wind, solar and other non-hydropower renewables provided slightly less than 10% of electricity generation in 2017. EIA expects the same to provide more than 10% in 2018 and nearly 11% in 2019.
Despite efforts of the new administration to revive usage of coal in different industries, we could notice that large utilities like NextEra Energy (NEE - Free Report) , Ameren Crop (AEE - Free Report) and CMS Energy (CMS - Free Report) are increasingly investing in renewable and lowering toxic emission.
Shares of AES Corporation have outperformed its industry over the past year. The stock has surged 41.5% versus the 4.1% decline of its industry.
AES Corporation has 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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