The semiconductor and solar technology provider
MEMC Electronic Materials Inc.
) recently announced that its subsidiary SunEdison has sold its 20
megawatt (MW) solar photovoltaic power plant to
) and Turner Renewable Energy for an undisclosed sum.
Situated in southern U.S., Southern Company operates as an
electric utility company and is involved in the generation,
transmission, and distribution of electricity through traditional
as well as renewable sources. In an attempt to pursue the
development of renewable energy projects in the U.S., the company
got into a partnership deal with Turner Renewable Energy, which is
a wholly owned subsidiary of Turner Enterprises. SunEdison's solar
plant is the partnership's second big acquisition, the first being
First Solar Inc.
) in March 2010.
This Las Vegas-based plant covering 154 acres was initiated in
October 2011. The plant is expected to be operational by the end of
September. Power generated from this plant will be purchased by
NV Energy Inc.
) under a long-term agreement of 25 years. NV Energy provides
energy solutions to the citizens of Nevada State.
Earlier, SunEdison's solar plant in Rovigo, Italy was sold to
First Reserve. The plant with a 70 MW capacity was sold for €276
million in October 2010.
This February, SunEdison sold a 30 MW plant to
) and Longsol Holdings US Inc. The plant was completed and fully
operative in December 2011.
As of March 31, 2012, SunEdison had 146.6 MW of solar projects
under construction, predominately in the U.S. Also, there are
$274.7 million of worth projects in Italy, Spain and Bulgaria that
are up for sale. MEMC's unit has a project pipeline of
approximately 2.9 gigawatts (GW), which is slightly down from the
3.0GW of project pipeline as of December 31, 2011.
Currently, the solar industry is experiencing a significant
downturn, which started in the second half of 2011. The sector is
witnessing sharp reductions in the pricing of solar modules, solar
cells, solar wafers and polysilicon (raw material for solar wafer).
This has resulted in a decline in profitability for all solar
companies, including MEMC.
While a recovery in the situation appears to be far away,
SunEdison is trying its luck in the solar space with its broad
exposure in India. In May, the company agreed to support a rural
electrification program called Eradication of Darkness by
developing solar generation power plants.
Flextronics International Ltd.
) and Jusung Engineering Co. Ltd. could make SunEdison's solar
ventures more cost efficient and profitable. But the increasing
debt burden is likely to take a toll on the fundamentals, going
Currently, MEMC has a Zacks #3 Rank, implying a short-term Hold
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