Indianapolis Power & Light (IPL), a subsidiary of
The AES Corporation
), received the regulatory approval for the construction of two
natural gas projects. The company will construct a new 650 megawatt
(MW) combined-cycle gas turbine ("CCGT") power plant and convert
two existing coal-fired units having a combined generation capacity
of 200 MW to natural gas units.
The Indiana Utility Regulatory Commission (IURC) allowed IPL to
invest $600 million for the construction of the CCGT power plant
near Martinsville, IN. Additionally, IPL will spend $36 million to
convert two existing coal-fired units to natural gas units at the
Harding Street Generation Station. The total project cost of $636
million will comprise 45% equity and 55% non-recourse debt.
The company will start constructing the CCGT project in the third
quarter of 2014 and it expects the project to come into operation
in 2017. The conversion of the Harding Street units will be
completed by early 2016.
AES Corporation continues to expand its existing operations
worldwide. In the last six months, the company got final approvals
for, or achieved financial closing on about 2,600 MW of projects in
the United States, Chile, India and Panama. The company expects
that these projects will start contributing to its earnings and
cash flow growth over 2015 to 2018.
For 2014, the company has planned to invest $270 million largely in
platform expansions at IPL and Gener's Guacolda generation
business. AES Corp. reaffirmed its 2014 adjusted earnings guidance
in the range of $1.30 to $1.38 per share primarily due to the
continuation of dry hydrological conditions in Latin America. The
Zacks Consensus Estimate for 2014 earnings is pegged at $1.34 per
Currently, the company holds a Zacks Rank #3 (Hold). Other
better-ranked stocks in this sector include
Black Hills Corporation
Brookfield Infrastructure Partners L.P.
), carrying a Zacks Rank #1 (Strong buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
AES CORP (AES): Free Stock Analysis Report
BROOKFIELD INFR (BIP): Free Stock Analysis
BLACK HILLS COR (BKH): Free Stock Analysis
CALPINE CORP (CPN): Free Stock Analysis Report
To read this article on Zacks.com click here.