NRG Energy's Solar Asset Crosses 1,200MW Mark - Analyst Blog

NRG Energy, Inc. NRG announced that its solar asset-base has crossed 1,200 megawatt MW mark. Currently, the company can serve approximately one million homes.

NRG Energy runs solar operations under its two subsidiaries – NRG Yield, Inc. NYLD and NRG Solar LLC.

It is evident from the records that NRG Energy continues to solidify its solar capacity through internal and inorganic growth program. On Mar 27, 2014, the company acquired Roof Diagnostics Solar, a residential solar company. This transaction will enable the company to strengthen its presence in the retail space.

On Mar 4, 2014, the company and The Boeing Company BA started construction of Guam's first solar power plant. Post completion, the company will provide emission free energy to 10,000 homes.

As far as inorganic expansion strategy is concerned, NRG Energy received approval from the Federal Energy Regulatory Commission for the entire transfer of Edison Mission Energy (“EME”) assets, a unit of Edison International EIX, to the company. EME's asset base includes 10 gas-fired plants in California, 4 coal-fired plants in Illinois and more than 30 wind projects in different states. The acquisition will enable the company to add 8,000 MW to its generation portfolio.

Utilization of renewable energy is currently increasing primarily due to its clean nature and a growing awareness among the masses regarding its benefits. These influence utility providers to shift their mode of power generation to solar, wind and water from the fossil fuel. In 2013, installation of solar photovoltaic (PV) in the U.S. increased 41% year over year and 29% of the total new power generation capacity came from solar.

We remind investors that NRG Energy is strongly following renewable energy expansion program. During 2013, the company completed several important solar projects - Borrego Solar Generating Station, Agua Caliente Solar Generating Station, Kansas South Generating Station, Alpine Solar Generating Station, California Valley Solar Ranch, TA-High Desert Generating Station. We believe that the scheduled completion of these projects enabled the company to scale up its thermal and PV projects portfolio to more than double from the 2012 level.

As of Dec 31, 2013, NRG Energy had cash and cash equivalents of around $2.25 billion. The company's cash flow from operating activities was $1.27 billion. A strong cash position and efficient cash generation capacity through operating activities enable the company to increase alternate energy portfolio, thereby meeting the government's renewable standard.

Princeton, N.J.-headquartered NRG Energy currently has a Zacks Rank #3 (Hold).