Wells Fargo & Company
) announced that it has financed a 11.3 megawatt (MW) solar power
project of Sun Edison, in southern New Mexico near El Paso.
SunEdison - a subsidiary of
MEMC Electronic Materials Inc.
) - is a leading solar energy provider.
The power supplied by the project will be sold to the
El Paso Electric Co.
) under a 25-year Power Purchase Agreement. It is expected that the
solar farm will produce more than 26 million kilowatt-hours of
electricity on an annual basis when all the solar modules will come
This project is part of El Paso Electric's current policy to
increase renewable energy in order to meet its customers' demand.
Since 2011, through project construction and power purchase deals,
El Paso Electric's solar generating capacity stands at roughly 47
This is not the first time that Wells Fargo is investing in the
renewable energy sector. Over the past one year, Wells Fargo has
funded five other SunEdison solar projects. In fact, the company's
Energy Investments group is mainly focused on financing renewable
Since 2007, Wells Fargo has granted approximately $2.8 billion in
equity and around $900 million in debt financing for renewable
energy projects across 28 states. Further, over the same period,
the company has invested about $1.0 billion in such projects, which
involves funding roughly 250 commercial-scale solar PV projects, 6
utility-scale solar PV projects and a utility-scale concentrating
solar thermal power plant.
The success of SunEdison projects exhibits the growth of solar
industry and indicates Wells Fargo's assurance to renewable energy
and sustainability. Moreover, with the aforementioned deal,
SunEdison plans to generate reasonable solar energy solutions in
the industry with its experience and large scale deployments.
Such an achievement will boost the dynamics of distributed solar
generation, produce a significant source of clean energy and
reflects the company's strong business values.
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Similarly, in 2011,
Bank of America Corporation
), Prologis and
NRG Energy, Inc.
) announced an offer to help the largest distributed rooftop solar
generation project in the world. The offer includes a provisional
assurance with respect to finance from the U.S. Department of
Energy's Loan Programs Office. The loan guarantee facilitated debt
of $1.4 billion of the total project size of about $2.6 billion,
which will be financed completely by 2015 by the private sector.
We expect continued synergies from Wells Fargo's diversified
operations and strong capital position. With cross-selling as its
key strength, the company has a diverse geographic and business mix
that enables it to sustain consistent earnings growth.
Wells Fargo currently retains a Zacks #3 Rank a short-term Hold
rating. Considering the fundamentals, we also maintain our
long-term 'Neutral' recommendation on the shares.