The AES Corporation AES recently announced that the first phase of its Chevelon Butte wind farm has commenced commercial operation. The first phase, which brings in 238 megawatts (MW) of clean energy to AES Corp. customers, enables the company to take a step forward in meeting its green energy goal.
Meanwhile, the Chevelon Butte farm, claimed to be the largest wind energy project in Arizona, boasts a total generation capacity of 454 MW of wind energy. It is expected to be fully operational with both phases by 2024.
AES’ Goals in Renewables
To rapidly expand its renewable footprint, both on the domestic front and in overseas markets, the company is investing aggressively. Currently, AES Clean Energy has a 5.2 GW backlog of projects, the majority of which are expected to come online through 2025.
Through 2025, AES Corp. expects to invest a total of $4 billion in new renewables, generation, transmission, modernization and smart grid at its U.S. utilities. With such an aggressive investment strategy, the company expects to add 14-17 GW of capacity to its project portfolio through the 2023-2025 period.
Through 2027, the company expects to triple renewable capacity by adding 25 to 30 GW of solar, wind and energy storage. The Chevelon Butte farm, once fully operational, will aid AES Corp. in duly achieving this target.
The company is also investing in the liquefied natural gas market. AES continues to advance the development of its Son My LNG terminal project, which has a design capacity of up to 9.6 million metric tons per annum, and the Son My 2 CCGT project, which has a capacity of about 2,250 MW. Such expansion projects will boost AES Corp.’s footprint in the expanding LNG market in the long haul.
Efforts undertaken by the company to provide reliable and sustainable energy to its customers may assist AES in duly achieving its long-term target in the renewable space.
Utilities in the United States are consistently upgrading their ways of delivering energy to customers in a greener way. Apart from AES Corp., utilities that have significantly expanded and are increasingly exploring opportunities in the renewable energy space are as follows:
Duke Energy DUK announced the completion of two solar projects in the Alachua and Suwannee counties in April 2023. The sites at peak production will deliver 150 MW of clean, renewable energy to the grid to benefit Florida customers.
Duke Energy has a long-term earnings growth rate of 6.2%. The Zacks Consensus Estimate for DUK’s 2023 earnings implies a growth rate of 6.6% from the prior-year reported figure.
Entergy Corporation’s ETR arm, Entergy Louisiana, filed a request in March 2023 with the Louisiana Public Service Commission seeking consent for the construction of two solar projects with a combined production capacity of 225 MW. The company aims to expand its renewable energy portfolio with these projects.
Entergy’s long-term earnings growth rate is 5.7%. The Zacks Consensus Estimate for ETR’s 2023 earnings suggests a growth rate of 3.9% from the prior-year reported figure.
CMS Energy’s CMS arm, Consumers Energy, announced the commencement of the operations of the Covert Generating Station in Southwest Michigan's Van Buren County in June 2023. This station is an important part of its industry-leading Clean Energy Plan to meet Michigan's energy needs this summer and for years to come.
CMS Energy has a long-term earnings growth rate of 7.5%. The Zacks Consensus Estimate for CMS’ 2023 sales suggests a growth rate of 2.6% from the prior-year reported figure.
In the past year, AES Corp. shares have increased 11.1% against the industry’s decline of 16.6%.
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AES 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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