The world's largest thin-film solar manufacturer,
First Solar, Inc.
) has purchased the North Star solar project from NorthLight
Power LLC. The deal comes a day after the First Solar stock
experienced its biggest gain since its listing in Nov 2006. The
companies, however, did not reveal the financial terms of the
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The 60-megawatt North Star photovoltaic (PV) solar plant has been
developed by NorthLight, which is a joint venture company between
Renewable Energy Corp. ASA with 60% interest and Summit Power
Group, LLC (40%). Construction on the project, located in
Mendota, Calif., is scheduled to begin by next year and finish in
2015. This will likely create around 410 construction jobs.
This PV solar plant has a 20-year power purchase agreement with
Pacific Gas and Electric Company, an affiliate of
). Upon the successful start-up of the plant, the company expects
to generate adequate clean, renewable energy to serve more than
21,000 average California homes. This is equivalent of taking
about 7,500 cars off the road per year, or, displacing around
33,000 metric tons of water consumption and 39,000 metric tons of
CO2 per year.
With this acquisition, one of the leading manufacturers of
comprehensive PV solar systems, First Solar will be able to
construct its first utility-scale PV power project in Fresno
County. Apart from this, North Star will create construction
employment, while serving the state successfully with its
renewable energy mandate.
On Apr 10, 2013, First Solar also provided its 2013 guidance. The
forecast calls for 2013 net sales of between $3.8 billion and $4
billion. The bottom line for the year is expected to come in the
range of $4.00 and $4.50 a share. This surpassed most of the
analysts' projection as well as the Zacks Consensus Estimates of
$3.69 per share of earnings on sales assumption of $3.5 billion.
Along with this guidance announcement First Solar also entered
into an acquisition agreement − expected to be completed in the
second quarter of 2013 − with JX Nippon Oil & Energy
Corporation. Per the deal, First Solar plans to purchase TetraSun
from JX Nippon for an undisclosed amount. This transaction will
allow First Solar to expand its footprint in Japan which is
expected to become the second-largest market for solar products
in 2013 after China. Again, TetraSun has significant expertise in
silicon PV technology and has achieved world records for silicon
cell efficiencies at companies like
However, First Solar, like its other solar peers, is currently
witnessing a steep drop in Average Selling Prices. Also, the
current macro scenario does not bode well for the solar industry,
which thrives mainly on subsidies and grants.
The company presently retains a short-term Zacks Rank #3 (Hold).
Another solar company
Canadian Solar Inc.
) with a Zacks Rank #2 (Buy) looks more promising and worth