NextEra Energy Resources (NEER), a subsidiary of public utility holding company, NextEra Energy, Inc. NEE, has secured a contract to build, own and operate solar power generating systems of approximately 17 megawatts (“MW”) on military installations in Hawaii.
In 2011, the Naval Facilities Engineering Command (NAVFAC) Pacific appointed Pacific Energy Solutions, LLC, (PES), an energy development company, to make use of specified sites on military installations in Hawaii to build solar power generating systems and directly sell power to the military. In Oct 2015, an affiliate of NEER procured membership in PES.
Per the contract, a NEER unit will build 1 ground-mounted fixed-tilt solar system, 3 carport solar systems and 10 rooftop solar systems. These facilities will consist of approximately 71,000 Sharp solar modules with construction expected to begin in Feb 2016 and be completed by year end. The U.S Navy will purchase all of the power generated from the facilities under a 25-year power purchase agreement.
NextEra’s investment in alternative sources of energy over the last few years has been compelling. The company signed contracts for about 725 MW of new wind and solar projects. The company is on track with its Port Everglades Clean Energy Center with expected commencement in mid 2016. The company took over Cedar Bay Generating Plant in the third quarter.
As per the U.S. Energy Information Administration (EIA), electricity generation from renewable sources is projected to increase to 18% by 2040 in the U.S., with renewables accounting for 9.8% of total power consumption in 2014. Per the EIA’s latest reports, nearly 9 gigawatts of new solar generation will come online in the U.S. in the 2014 to 2016 timeframe.
The U.S Navy is doing it bit to contribute to these plans by setting forth aggressive targets of alternative energy sources, which would contribute 50% to total energy consumption by 2020. Presently, the Navy produces 12% of its total annual energy consumption from renewable sources. The Department of the Navy has installed photovoltaic arrays in several locations producing a total of more than 4 MW of electricity and is currently installing approximately 20 MW of additional photovoltaic generation
Zacks Rank
NextEra Energy carries a Zacks Rank #2 (Buy). Some other stocks worth considering in the same industry are Korea Electric Power Corp. KEP and Huaneng Power International, Inc. HNP, both sporting a Zacks Rank #1 (Strong Buy) and FirstEnergy Corp. FE, carrying a Zacks Rank #2 (Buy).
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