NextEra Energy (NEE - Free Report) announced that its arm NextEra Energy Resources and Entergy Arkansas, a subsidiary of Entergy Corporation (ETR - Free Report) , have started the construction of a 100-megawatt (MW) solar project — the Chicot Solar Energy Center — in Arkansas. This will be the largest solar project in the state and produce enough energy to provide clean electricity to 18,000 homes.
NextEra Energy Resources will build, own and operate the Chicot Solar Energy Center, while Entergy Arkansas will purchase power from this project under a long-term agreement for 20 years.
Solar Energy in Focus
With the help of Energy Resources, NextEra is expanding renewable energy generation capacity. The company is expected to add 3,800-7,300 MW of solar power assets to its generation portfolio during the 2019-2022 time frame.
During the third quarter, Energy Resources added 747 MW of solar generation assets to its renewable backlog. Total renewable backlog at the end of the third quarter, including other renewable sources, was 12,300 MW.
Last month, the company started a new solar project in South Carolina, which added 74.9 MW to its generation portfolio.
Solar Projects Gaining Popularity
Solar energy production is expanding at a rapid pace in a few U.S. states due to plummeting prices of solar modules and panels. Moreover, solar investment tax credit has been boosting growth in the solar space.
The Solar Energy Industries Association (“SEIA”) industry group provided a roadmap to increase solar power contribution to 20% of U.S. power generation by 2030 from just 2% in 2018. According to SEIA, currently 37,000 MW of utility scale solar projects are operating in the United States and another 74,000 MW is under development.
U.S. utilities like Dominion Energy (D - Free Report) and Duke Energy (DUK - Free Report) , among others, are investing in solar energy and gradually increasing solar power capacity in their generation portfolio.
Shares of NextEra have gained 26.9% compared with the industry’s 7.1% rally in the past 12 months.
NextEra 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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