Richmond-based utility Dominion Resources Inc.’s (D - Free Report) business arm, Dominion Virginia Power received approval from the state’s regulators for the construction and operation of a solar power demonstration project in Virginia.
The construction of the 30-megawatt solar generation facilities was sanctioned by the State Corporation Commission ("SCC"). The facilities would be constructed at different locations by leasing rooftops of commercial, industrial, and public government buildings. Each installation will have a generating capacity of 500 kilowatts to 2 megawatts and will span a roof area of 75,000 square feet or more.
The renewable program’s estimated cost was set at $111 million by the company. However, regulatory authorities restricted capital spending to $80 million to reduce the burden on customers. When operational, the project output would be adequate to power around 6,000 homes during peak daylight hours.
The solar facility will boost Dominion’s position given the current positive vibe in the U.S. energy market that favors eco-friendly sustainable power generation. Although the use of wind energy for electric generation has gained considerable grounds in the U.S., we believe solar energy is not far behind.
The potential increase in solar energy usage in the U.S. will significantly complement Dominion’s targeted renewable growth goals of 15% for its Virginia operations by 2025. The Zacks Consensus Estimates for the fourth quarter and full year 2012 presently stand at 69 cents and $3.06 per share, respectively.
Another utility operator American Electric Power Company Inc.’s (AEP - Free Report) Ohio subsidiary, AEP Ohio entered a 20-year power purchase agreement for solar energy with Turning Point Solar LLC., a joint venture of Agile Energy Inc. and New Harvest Power. Both American Power and Dominion currently retains a Zacks #3 Rank (Hold rating).
Dominion Resources, Inc., together with its subsidiaries, engages in producing and transporting energy in the United States. It operates in three segments: Dominion Virginia Power, Dominion Generation and Dominion Energy. With market capitalization of $29.12 billion, the company has total 15,800 employees.