AVANGRID (AGR) Initiates First Onshore Wind Project in Oklahoma

AVANGRID, Inc. AGR announced its first onshore wind project in Oklahoma, a 147.5-megawatt (MW) wind farm with 33 turbines called Pontotoc Wind. The project will generate about 500,000 megawatt-hour of power each year.

This project will be constructed in Pontotoc County. It will deliver clean, renewable wind power to 40,000 homes and expand AVANGRID’s presence in the United States to 25 states.

The construction work is expected to start in 2024. AGR anticipates the project to benefit the neighborhood for almost 20 years.

Focus on Renewable Energy   

AVANGRID is among the largest renewable energy operators in the United States, with an installed renewable capacity of more than 8.6 gigawatts (GW). After the abovementioned project's completion, the company will have assets or activities across half of the nation.

Post the merger agreement’s termination with PNM Resources PNM, AGR also remains focused on developing New Mexico's wind and solar energy resources. With more than $9 billion of incremental capital projects organically secured during the pendency of the merger, the company intends to focus on its strong growth prospects.

In addition to the capital projects related to the transmission of clean energy in New York, AGR will focus on delivering more than $5 billion of capital projects under its multiannual rate plans in New York and Maine, repowering more than $5 billion of renewable energy assets under the benefits of the Inflation Reduction Act (IRA).

The company is progressing on its Vineyard Wind 1 offshore project, with the installation of five wind turbines by December 2023. The 806 MW project is expected to start commercial operations in 2024.

Renewable Energy Generation on the Rise

The passage of the IRA will support and accelerate the utilities’ transition toward clean energy sources. The Act entails an opportunity for a wide range of low-cost clean energy solutions in a predictable way for a long time and will create earnings visibility.

Per the U.S. Energy Information Administration (EIA), the annual share of U.S. electricity generation from renewable energy sources will rise 24% and 26% in 2024 and 2025, respectively. EIA expects wind generation to increase 30 billion Kilowatthour (kWh) in 2024 and 17 billion kWh in 2025. Wind’s share of total generation is expected to reach 12% in 2025, up from 11% in the previous year.

AVANGRID is committed to lowering emissions and adding more renewable sources to the generation portfolio. Some other electric power industry companies like Xcel Energy Inc. XEL and NextEra Energy, Inc. NEE, among others, are also adopting measures to meet clean-energy targets.

Xcel Energy is reducing coal usage and targets to lower emissions by at least 80% by 2030 and achieve carbon neutrality by 2050. After completing six wind projects with 1,500 MW capacities in 2020, the company completed four wind farms, adding another 800 MW of clean energy generation capacity to its portfolio. Its total wind capacity is 11,000 MW, out of which 4,500 MW is from owned wind farms.

XEL’s long-term (three to five-year) earnings growth rate is 6.02%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year increase of 6.6%.

NextEra Energy is aiming to reduce total carbon emissions by 67% within 2025 from the 2005 level. It continues to work on its strategy of making a long-term investment in clean-energy assets. The company expects to be able to add 33-42 GW of new renewables through 2026 to the generation portfolio via clean-energy investments.

NEE’s long-term earnings growth rate is 8.18%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year increase of 8.5%.

Price Performance

In the past three months, shares of AGR have risen 2.7% compared with the industry’s 4.8% growth.

 

Zacks Investment Research
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Zacks Rank

AGR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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