BCAP Funding Confirmed, BLX-T To Benefit
Analyst Ben Isaacson of Daily Edge maintains his "sector outperform" rating on Boralex Inc (TSX: BLX-T). The target price for BLX-T is set to C$12.50.
Boralex announced that all of its biomass facilities in Northeastern US have qualified for two years of subsidies under US President Obama’s Biomass Crop Assistance Program (BCAP). “Wood residue supply costs should be reduced by about US$12 million per year over the next two years, or the equivalent of about US$12/MWh,” the analyst says.
“In our view, BCAP funding fully offsets the recent expiry of the US Production Tax Credit on existing biomass facilities in the US, which we estimate provided normalized EBITDA of between US$11 million and US$13 million per year to BLX,” according to Daily Edge.
