Yahoo Finance Canadian Solar (CSIQ) Inks Solar Deal With Industry Consortium
Canadian Solar Inc.’s CSIQ subsidiary, Recurrent Energy, recently inked an aggregated virtual power purchase agreement (PPA) with five corporate organizations in the MISO region for the supply of solar energy through its Liberty Solar project. Per the deal, the company will supply 100% of its output from the Liberty Solar project to this industry consortium via a 16-year contract.
The Liberty Solar project, located in the MISO South region of Texas, boasts a capacity generation of 100 megawatts (MW) of electricity. The project is expected to be operational by 2024. The energy produced by the project will be enough to power approximately 15,000 homes annually.
Benefits of the Agreement
The aforementioned PPA ensures an inflow of revenues for CSIQ over a long period from the project once it reaches commercial operation.
Such vast and strategic deals open growth avenues for Canadian Solar in the corporate world as nations reshape their ways of generating energy and move toward renewable sources.
Opportunities Offered by the US Solar Market
Per the latest report from the Solar Energy Industries Association (“SEIA”), 20.2 gigawatts direct current (GWdc) of solar PV capacity were added in the United States in 2022, with solar contributing half of the new electricity-generating capacity. Going forward, SEIA suggests that in 10 years, the expansion of the solar industry is likely to accelerate and grow five times higher, bringing the total installation to 700 GWdc by 2033 from 141 GW today.
With supply-chain constraints expected to ease with the strengthening of the domestic manufacturing of components and parts, one may expect solar stocks like CSIQ and other forerunners in the industry to gain from the strong footing of solar energy in the renewable space.
Solar players that stand to gain in the U.S. solar market are as follows:
Enphase Energy ENPH: It enjoys a valuable position in the U.S. solar market. The company’s revenues increased 28% year over year in the United States in the last reported quarter. ENPH also began manufacturing at Flex Romania in the first quarter of 2023, bringing the quarterly capacity to approximately six million microinverters.
Enphase boasts a long-term earnings growth rate of 26%. ENPH shares have risen 4.8% in the past year.
Emeren Group Ltd SOL: For Emeren Group, the United States continues to be a large and lucrative market. The company had mid-to-late-stage projects of 742 MW in the United States as of Dec 31, 2022. Additionally, its projects are under development in Alabama, California, Illinois and Pennsylvania.
The Zacks Consensus Estimate for SOL’s 2023 sales suggests a growth rate of 81% from the prior-year reported figure. The Zacks Consensus Estimate for its 2024 earnings has moved upward by 17.8% in the past 60 days.
First Solar FSLR: After opening its third manufacturing facility in the United States, the company now projects to build its fourth U.S. manufacturing facility, which is expected to commence operations in late 2024. First Solaris also eyeing opportunities to expand its manufacturing footprint at its existing facilities in Ohio. Such production ramp-up expectations should enable FSLR to maintain its position as the largest U.S. solar module manufacturer.
The Zacks Consensus Estimate for First Solar’s 2023 sales suggests an improvement of 32.2% from the last year’s comparable figure. Its Zacks Consensus Estimate for 2023 earnings has been revised upward by 15.4% in the past 60 days.
Price Movement
In a year, shares of Canadian Solar have soared 42% compared with the industry’s growth of 30.8%.
Image Source: Zacks Investment Research
Zacks Rank
Canadian Solar 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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