announced that it will jointly develop another solar project for the University of Virginia (UVA), with a capacity to generate 15 megawatt (MW) green energy. The UVA Puller Solar facility will be constructed in a 120-acre area in Middlesex County.
The solar project will be developed by Coronal Energy, and constructed and owned by Dominion Energy. The entire power produced from this solar project will be purchased by UVA under a 25-year power-purchase agreement.
This project will be Dominion Energy’s second solar project for the UVA. Last year in December, Dominion entered into an agreement with the university to develop UVA Hollyfield Solar project, a 17 MW solar project. UVA will purchase the entire produce from the project under a similar 25-year power-purchase agreement.
Dominion Energy’s solar projects will help UVA to achieve its target of reducing 25% greenhouse gas emission by 2025 from 2009 levels. The two new solar projects will provide 32 MW of clean energy and take care of 21% of the UVA’s electricity demand.
Dominion to Add 500 MW Solar in Virginia
Dominion Energy plans to add 500 MW of solar energy in Virginia and is well on its way to achieve its target. The new solar additions will increase its solar power generation capacity to nearly 421 MW in Virginia. The company aims to invest more than $800 million in the state by 2020.
Earlier this month, the company acquired a 10 MW solar unit in Clarke County, VA, from the project’s developer, an affiliate of Chicago-based Hecate Energy, LLC. The company also declared its intention to acquire another 20 MW solar farm, presently under construction in Northampton County, VA, from the same company, in the third quarter of 2017 (read more: Dominion Acquires Unit in Virginia, Set to Add 500 MW Solar).
U.S. Solar Industry
The current projections provided by the U.S. Energy Information Administration (EIA) indicate a steady growth of solar generation in the country.
In 2016, the total utility-scale solar electricity generating capacity in the U.S. was 21 gigawatts (GW). Moving ahead, EIA expects solar capacity additions during the year to reach 29 GW and 32 GW by the end of 2017 and 2018, respectively.
The extension of Solar Investment Tax Credit till 2021 will help in developing more utility scale solar projects in the U.S. despite the new administration’s decision to support coal industry and relax emission regulation.
Given the positive forecasts from EIA, we expect utilities like Duke Energy (NYSE:DUK) , which at present operates nearly 400 MW of solar assets, to keep on expanding their renewable portfolio.
Shares of Dominion Energy have returned 1.8% in last six months compared with the industry’s gain of 5.9%.
Even though Dominion Energy underperformed the industry, expansion of its electric transmission, natural gas facilities and midstream assets are strong positives.
Zacks Rank & Stocks to Consider
Dominion Energy currently has a Zacks Rank #4 (Sell).
Better-ranked stocks in the same space are Atlantica Yield PLC (NASDAQ:ABY) and RWE AG (OTC:RWEOY) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Atlantica Yield is expected to report second-quarter results on Aug 10, 2017. The Zacks Consensus Estimate for the second quarter moved up 22.2% in the last 30 days to 11 cents per share.
RWE AG is expected to report second-quarter results on Aug 10, 2017.
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