Avista Corporation AVAannounced that it is seeking proposals or tender offer from the developers of the renewable energy projects, who owns or operates or can build up to an average of 50 megawatts (MW) of renewable energy via single or multiple proposal with a minimum net annual output of average 5 MW of electricity.
Avista will consider proposals that include storage associated with the generation assets.To avoid complexities of building the facility, the company has come up with a Request for Proposal (RFP). The parties eligible for a tender offer to the company via RFP should own an existing facility, propose to develop or should possess rights to construct facilities for generation of renewable energy.
Avista’s Take on Renewables & Capex Plan
The company is intending to increase the energy output more from the renewable source. It is looking forward to opportunities for acquisition or addition of more renewable energy resources to its existing capacity in order to offset market purchases and fossil fuel energy generation. The company is planning to generate electricity at lower cost in the long term, thereby reducing the heavy dependence on fossil fuel to some extent.
As of Dec 31, 2017, the company had total capacity of 1,875 MW with an electricity generation mix of 55.5% from renewable (Hydro-49%, Wind-4.5% and Biomass-2%).
The company is expected to incur a capital expenditure of around $1,237 million over the 2018-2020 period on generation, transmission and distribution system to preserve and enhance the reliability of the services provided to its customers and to replace the aging infrastructure.
Importance of Renewable
Renewable Energy source has been gaining momentum globally. Wind and solar power have been two of the fastest growing sources of electricity generation on the international front over the past decade. In 2017, global installed wind capacity grew by nearly 11%, thus bringing the global total to 540 GW. Projections by the International Energy Agency indicate that renewable energy will continue to grow more rapidly than fossil fuels over the next two decades.
In 2018, per U.S. Energy Information Administration report, 9 GW of new solar and wind assets will be added, thus underscoring the rising significance of renewable sources in the United States.
Price Movement
In the past year, shares of Avista have outperformed the Zacks Utility industry. The stock has rallied 21.2% versus the industry’s decline of 9.6%.