Amazon (AMZN - Free Report) announced two new renewable energy projects in the United States and one in Spain.
These clean energy projects are expected to provide 180 megawatts (MW) of renewable capacity and generate almost 400,000 MWh of renewable energy on an annual basis in the United States.
On completion, all the three solar projects are expected to provide an estimated 329 MW of additional renewable capacity. This energy will be used in the company’s fulfillment network in Europe and AWS data centers.
The latest move will reduce carbon footprint. Moreover, Amazon will leverage renewable energy to save the environment.
In addition to the above, Amazon's renewable energy project in Europe will be the company's first large-scale project in Spain, located southeast of Sevilla. This solar farm is expected to provide 149 MW of renewable capacity.
Amazon.com, Inc. Price and Consensus
Growing Carbon Neutrality Endeavors
The latest energy projects are inline with the company's goal of using 80% and 100% renewable energy by 2024 and 2030, respectively.
Recently, Amazon had placed a purchase order for 100,000 electric delivery trucks with Rivian, an automaker and automotive technology company. This is a testament to its relentless efforts to ramp up e-commerce and retail delivery services.
Apart from this, the company’s cloud computing platform, Amazon Web Services (“AWS”) is also focused on green energy. Recently, Amazon announced three new renewable energy projects in Ireland, Sweden and the United States to power AWS’ global infrastructure globally. In 2018, AWS had stated that it had used more than 50% of renewable energy for its global infrastructure.
Notably, Amazon has launched more than 70 clean energy projects that are anticipated to produce a total of more than 1,900 MW of renewable capacity.
We believe its commitment toward environmental, social and governance practices is expected to bolster investor confidence and increase loyalty.
Increasing Focus on Renewables
Per a report by Energy Information Administration, renewables will collectively produce 18% of U.S. electricity in 2019 and 19% in 2020. The usage of renewable energy has gradually increased over the past few years.
Amazon has been shifting focus from fossil fuels to clean energy for quite some time now. The shift to clean energy sources is anticipated to reduce its costs in the near term. Additionally, Amazon can generate healthy returns from strengthening solar and wind investments as there are several associated tax incentives.
Apart from Amazon, tech giants like Alphabet (GOOGL - Free Report) , Microsoft (MSFT - Free Report) and Apple (AAPL - Free Report) are also undertaking initiatives to adopt alternative energy sources to lower overall carbon emissions and cut energy bills substantially.
Google’s aggressive three-fold strategy — which includes energy efficiency, renewable energy procurement and carbon offsets — makes it fully committed to carbon neutrality. Further, Microsoft inked two power purchase agreements with EDP Renewables North America LLC to work on a wind energy project based out of Paulding County, OH.
Nevertheless, Amazon's recent deal is expected to provide it with a boost in this race to become carbon neutral.
Currently, Amazon 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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