NRG Improves Solar Assets Portfolio - Analyst Blog

Zacks Investment Research
Posted: Nov 22, 2011 5:31 PM
NRG Improves Solar Assets Portfolio - Analyst Blog

Power generation company NRG Energy Inc. (NRG) expanded its solar power capacity by acquiring San Francisco-based Solar Power Partners. Solar Power Partners is a leading developer of commercial and industrial (C&I) distributed solar projects. NRG Energy said the acquired Solar Power assets will form a part of its subsidiary NRG Solar.

Solar Power’s project sites include grocery stores, hospitals, universities, office buildings, municipal buildings, schools and airports. Through the Solar Power acquisition, NRG Energy will gain control of 30 megawatts (MW) of distributed solar projects in operation or under construction.

Additionally, NRG Energy will also acquire development rights to Solar Power Partners’ extensive pipeline of development projects in California, Hawaii, Arizona, Connecticut, New Mexico, Massachusetts, New Jersey, Ontario and Puerto Rico.

Solar Power Partners has to its credit nearly 50 commercial solar facilities and houses a team with deep experience developing, financing and operating projects. Solar Power Partners also specializes in creating long-term partnerships with customers to tailor each solar system to meet specific needs.

The acquisition should help NRG Energy become a leading provider of solar energy for the increasing number of businesses seeking solar solutions to manage their energy costs. Further, California has a goal to install 12,000 megawatts of distributed generation by 2020. All this, put together, is expected to place NRG Energy at the head of the pack as the solar industry moves toward smaller solar projects that connect directly to the grid.

NRG Energy currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. However, we currently maintain our Underperform recommendation on the stock. The company competes with AES Corporation (AES) and Calpine Corp. (CPN).

Based in Princeton, New Jersey, NRG Energy Inc. operates as a wholesale power generation company. The company is also involved in the trading of fuel and transportation services, energy trading, and related products in the United States and internationally.

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