AVANGRID's Unit Signs Renewable Deal With Nike To Expand (Revised)

AVANGRID, Inc.’s (NYSE:AGR) subsidiary, Avangrid Renewables, announced that it has signed a power purchase agreement (PPA) regarding a second wind contract with Nike, Inc. (NYSE:NKE) .

The latest PPA will cover the remainder of Avangrid Renewables' 286 megawatts (MW) Karankawa Wind Farm in Bee and San Patricio counties, TX. Austin Energy has already signed an agreement with Avangrid Renewables to purchase 200 MW power produced from this wind farm.

Avangrid Renewables first PPA contract with Nike included supply of green power from three Columbia Gorge-based wind farms. These farms were responsible for supplying 100% renewable energy to Nike’s headquarters near Beaverton, OR along with other facilities in Oregon.

AVANGRID’s Renewable Portfolio Expansion

Avangrid Renewables has been consistently investing in renewables for quite some time. Notably, the company recently initiated the commercial operations of three renewable wind farms in California, New Mexico, and Colorado.

With nearly 800 MW of renewable projects that came online in 2017, Avangrid Renewables has brought over 500 MW of new wind farms online in California, New Mexico, and Colorado, having long-term energy contracts, in 2018.

Further, it aims to add 1.8 gigawatts (GW) of new wind and solar assets to its U.S. fleet within 2016-2020 period. The company currently has 3,300 wind turbines across 22 states. In the long term, AVANGRID aims to invest nearly $3.3 billion in 2017-2020 to fulfill renewable goals.

Renewables’ Popularity among Utilities

The carbon-free power production and declining production costs are factors driving the popularity of the renewable sources for electricity production among utilities. The U.S. Energy Information Administration (“EIA”) projects wind capacity to reach 104 gigawatts (GW) by the end of 2019 from 2017 end level of 88 GW.

Despite the new U.S. administration’s initiatives to promote usage of coal, renewable energy’s popularity has encouraged other utilities like Consolidated Edison, Inc. (NYSE:ED) , and NextEra Energy, Inc. (NYSE:NEE) to make investments in renewables.

Price Movement

In a month, shares of AVANGRID have lost 3.7%, wider than the industry’s decline of 1.9%.

Zacks Rank

AVANGRID currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

(We are reissuing this article to correct a mistake. The original article, issued on Jan 19, 2018, should no longer be relied upon.)