PORTLAND, Ore. - Avangrid, Inc. (NYSE: NYSE:AGR), a prominent sustainable energy company, has entered into a Virtual Power Purchase Agreement (VPPA) with Statkraft, Europe's largest renewable energy producer.
The agreement, announced today, is the first of its kind between the two companies in the U.S. market and involves the transfer of Renewable Energy Certificates (RECs) from Avangrid's 300 MW Streator Cayuga Ridge South Wind Farm in Illinois to Statkraft.
This short-term VPPA is tied to the amount of renewable energy produced by the facility. RECs are a market-based instrument that certifies the bearer owns one megawatt-hour of electricity generated from a renewable energy resource.
Pedro Azagra, CEO of Avangrid, emphasized the importance of partnerships like this in addressing climate change and managing merchant risk, ensuring the continued supply of clean energy. Patrick Pfeiffer, Head of Statkraft US, remarked that the VPPA is a significant step in expanding their PPA business in the United States and highlighted the importance of international cooperation in the global energy transition.
Avangrid operates one of the largest renewable energy portfolios in the U.S., with over 8.7 gigawatts of installed capacity. The company is recognized for its sustainable practices and has been ranked among the top in corporate citizenship and ethical standards.
Statkraft has a substantial global presence in the renewable energy sector, with operations in over 21 countries. The company has been active in the U.S. renewable energy commodity markets since 2015, engaging in carbon, renewable energy, and PPA markets.
The partnership between Avangrid and Statkraft is indicative of a growing trend in the energy sector where companies are increasingly collaborating across borders to foster a cleaner energy landscape. The details of this agreement are based on a press release statement from Avangrid.
InvestingPro Insights
Avangrid, Inc. (NYSE: AGR), with its recent Virtual Power Purchase Agreement, demonstrates a proactive approach to expanding its renewable energy initiatives. According to InvestingPro data, Avangrid has a market capitalization of 13.88 billion USD, which underscores its significant presence in the sustainable energy market.
The company's P/E ratio, as of the last twelve months ending Q4 2023, stands at 17.64, suggesting a valuation that may attract investors looking for stability in the energy sector.
While the company's revenue growth over the last twelve months has been moderate at 4.87%, the InvestingPro Tips reveal that Avangrid has faced challenges, such as operating with a significant debt burden and having short-term obligations that exceed its liquid assets.
Still, analysts are optimistic, predicting that the company will be profitable this year, which is supported by its profitability over the last twelve months. Furthermore, Avangrid's stock price has seen a large uptick over the last six months, with a 25.63% total return, indicating strong market confidence.
For readers interested in a deeper dive into Avangrid's financial health and future prospects, there are additional InvestingPro Tips available. These could provide valuable insights into investment decisions, especially in the context of the company's strategic partnerships and commitment to renewable energy. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription for more tips and comprehensive analysis.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.