The semiconductor and solar technology provider
MEMC Electronic Materials Inc.
) recently announced that its subsidiary SunEdison will sell a 20
megawatt (MW) solar photovoltaic power plant to Riverside Public
Utilities for an undisclosed sum. Riverside Public Utilities is a
municipal body set up for delivering electricity and water to the
citizens of the City of Riverside, California.
SunEdison plans to contract the proposed solar plant on a site
owned by Metropolitan Water District, located in the western
Riverside County. Construction is set to commence by 2014 and the
plant is expected to be operational by 2015.
Power generated from the plant will considerably reduce the
burden on non-renewable sources of energy. Also, the solar
plant's close proximity to the energy distribution centers will
lead to lowering of transmission cost.
Apart from Riverside Public Utilities, SunEdison's rich
experience has prompted Southern California Edison (SCE) and San
Diego Gas and Electric (SDG&E) to opt for its solar energy
services. The MEMC unit will hand over 48 MW and 18.5 MW of solar
power generating plants to SCE and SDG&E, respectively.
Financial details of the deals were not made public.
Earlier this year, SunEdison sold a 20 MW solar photovoltaic
power plant to
) in July and a 30 MW plant to
) in February.
SunEdison currently has 116.8 MW of solar projects under
construction. Moreover, a 13.6 MW project is ready for sale in
Spain. As per recently concluded third quarter 2012 results,
SunEdison has a project pipeline of approximately 2.9 gigawatts
(GW), slightly down from 3.0 GW at the end of fiscal 2011.
Though pricing in the solar industry has lacked luster over the
past few quarters, there are indications that demand for solar
panel installations will ramp in the coming quarters. A report
published by GTM Research and Solar Energy Industries Association
in June indicated that the U.S. solar panel market could grow
75.0% this year. Hence, it can be inferred that pricing would
improve leading to a better profitability.
We see MEMC's solar initiatives as a key driver for the long
term. But its debt-laden balance sheet keeps us concerned.
Currently, MEMC has a Zacks Rank #3 (Hold).
METLIFE INC (MET): Free Stock Analysis Report
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MEMC ELEC MATRL (WFR): Free Stock Analysis
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