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Xcel Energy Proposes to Invest $3B in Adding Renewable Assets

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Xcel Energy Inc. (XEL - Free Report) recently put forward an offer for one of the largest packages of energy investment. The company proposed to invest $3 billion in accelerated and incremental projects, which will help increasing job opportunities and provide a cushion to the economy.

This strategic move was in response to the appeal of Minnesota Public Utilities Commission and Department of Commerce to energy companies for bailing the state out of the pandemic-led crisis. However, these proposed projects are subject to approval from the Minnesota Public Utilities Commission.

Project Details

One of the projects includes maximizing solar-power generation up to 460 megawatts (MW) near the Sherco coal plant in Becker, MN. This, in turn, will lead to creation of 230-350 union jobs plus tax benefits from the state and local government. Also, a significant advantage related to landowner lease payments regarding the project duration will be gained. This installation will have the capacity to power more than 240,000 homes annually by producing carbon-free energy.

Secondly, incorporation of the latest technology in the old wind farms and increasing its power will also boost job creation for union labor and women, veterans and minority-owned businesses in greater Minnesota. Lastly, the proposal aiming to reduce customer bills includes expansion of the current energy conservation programs.

Additionally, the company pledged for investments in transmission, distribution, natural gas and electric vehicle infrastructure projects including building electric charging stations for automobiles as well as the public.

Investment Creates Huge Scope for Jobs

When millions of Americans are filing for unemployment benefits, Xcel Energy’s utility investments and subsequent job opportunities are definitely good news for the people of Minnesota.These proposed projects are likely to create 5,000 jobs in Minnesota and also stabilize the customer’s bills. Further, along with the company’s goal of lowering carbon footprint, these plans will drive the economy.

Investment to Support Lower Emission Goals

Xcel Energy is focusing on generating more electricity from clean energy sources. The company is working on various wind and solar projects to extend its renewable power generation portfolio. Management’s announcement of creating more clean projects in Minnesota will help it achieve its target of 80% carbon reduction by 2030 and 100% carbon-free electricity by 2050.

In addition to Xcel Energy, utilities like Duke Energy (DUK - Free Report) , DTE Energy (DTE - Free Report) and Avista Corporation (AVA - Free Report) among others chalked out a plan to supply 100% clean energy to customers.

Price Performance

Shares of Xcel Energy have gained 4.5% against the industry's decline of 22.1% in the past 12 months.


Zacks Rank

Currently, the company 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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