Alliant Energy To Buy 50% Of 225 MW Wind Project In Oklahoma
Zacks Investment Research | Jun 19, 2017 08:41AM ET
Regulated electric and natural gas service company, Alliant Energy Corporation (NYSE:LNT) announced that it has inked a Purchase and Sale Agreement with EDF (PA:EDF) Renewable Energy. However, financial terms and completion date of the transaction were kept under wraps.
Terms of the Agreement
As per the terms of the contract, EDF Renewable will sell 50% ownership interest of its 225 megawatts (MW) Great Western Wind Project to Alliant Energy. The remaining 50% cash equity ownership interest will be co-owned by its original developer – EDF Renewable.
EDF Renewable will continue to offer management services, with respect to this project. The services include a portion of the current operations and maintenance services as well as 24/7 remote monitoring from its Operations Control Center (OCC).
Details of the Project
Situated in Woodward and Ellis counties, OK, the Great Western Wind Project incorporates 30 V117 wind turbines with a unit capacity of 3.3 MW and 51 V100 turbines with a unit capacity of 2.2 MW.
In Dec 2015, EDF Renewable signed a long-term power purchase agreement (PPA) with Alphabet (NASDAQ:GOOGL) Inc. (GOOG), according to which the entire power produced by this plant will be sold to the search engine company.
Construction of the plant, initiated in the first quarter of 2016 was completed in Dec 2016. Commercial operations of the plant have also started in Jan 2017.
Our View
We believe the aforementioned contract sign is in line with Alliant Energy’s long-term plans to invest substantially for addition of natural gas and renewable assets to its generation portfolio over the next 10 years.
Toward this end, the company which currently owns nearly 568 MW of wind-based power generation units has further plans to add nearly 900 MW of wind generation assets to portfolio in the next few years.
Price Movement
In the last twelve months, Alliant Energy has outperformed the Zacks categorized Utility - Electric Power industry. The company’s shares rallied 11.9% compared with the industry’s gain of 4.7%.
Alliant Energy has earlier announced its plans to invest nearly $11.3 billion over the 2016–2025 time frame and a part of this initiative has already been in implementation since last year. This might have induced the company to outperform its broader industry.
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Stocks to Consider
Alliant Energy currently carries a Zacks Rank #3 (Hold).
A few better-ranked players from the Utility - Electric Power space include Unitil Corporation (NYSE:UTL) , Algonquin Power & Utilities Corp. (TO:AQN) and CenterPoint Energy, Inc. (NYSE:CNP) . All the three companies carry a Zacks Rank #2 (Buy). You can see
Unitil reported a positive earnings surprise 2.33% in first-quarter 2017. Its 2017 estimates have risen by 0.97% to $2.09 per share in the last 60 days.
Algonquin Power & Utilities reported a positive earnings surprise 11.76% in first-quarter 2017. Its current quarter 2017 estimates have risen by 25% to 10 cents per share in the last 60 days.
CenterPoint Energy reported a positive earnings surprise 2.78% in first-quarter 2017. Its current quarter 2017 estimates have risen by 5.26% to 20 cents per share in the last 90 days.
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