FirstEnergy Corporation FE announced that its subsidiaries, Mon Power and Potomac Edison, have begun construction on their second utility-grade solar site in West Virginia.

FirstEnergy will be providing its customers with clean, renewable energy from a former coal ash disposal site. The energy produced by its West Virginia solar sites will support economic growth in the region, as more companies demand that a certain percentage of the electricity purchased comes from renewable sources.

Expanding Solar Projects

The company has five proposed solar projects in West Virginia, the second of which is the Rivesville facility. The company's first solar site, which sits on 80 acres at the Fort Martin Power Station, was connected to the distribution grid in January 2024 and can produce up to 18.9 megawatts (MW) of solar energy per hour.

The proposed 27-acre Rivesville solar facility in Marion County will be located along the Morgan Ridge Road. Once deployed, the solar panels at the facility have the potential to generate up to 5.5 MW of clean energy. The Solar Energy Industries Association states that 1 MW of solar energy can power approximately 173 homes across the nation.

In the end, it is anticipated that the five locations owned by the corporations will produce 50 MW of renewable energy. It is expected that work on the Rivesville site and a third site (5.7 MW) in Berkeley County should be completed by the end of 2024. After consumers subscribe to the electricity produced, the businesses also intend to apply for final approval from the West Virginia Public Service Commission to construct two more solar sites in Davis, Tucker County (11.5 MW), and Weirton, Hancock County (8.4 MW).

Renewable Energy Generation on the Rise

According to the U.S. Energy Information Administration (EIA), the annual share of U.S. electricity generation from renewable energy sources will increase 24% and 25% in 2024 and 2025, respectively.

As stated by EIA, the electric power sector added 19 gigawatts (GW) of solar capacity in 2023 (an increase of 27%). It expects 36 GW to be added in 2024 and another 35 GW in 2025. With this new capacity, EIA expects solar to provide 6% of the total U.S. electricity generation in 2024 and 7% in 2025, up from a contribution of 4% in 2023.

Along with FE, some other electric power industry companies like Xcel Energy Inc. XEL, AVANGRID AGR and Dominion Energy, Inc. D are also expanding their renewable portfolio through solar and wind energy.

In September 2023, Xcel Energy received approval from Minnesota officials for the expansion of a solar energy project under construction. The State Public Utilities Commission approved adding 250 MW to a 460 MW array, which is part of the Sherco solar project. More than 150,000 houses will have access to the 710 MW project's yearly energy supply.

XEL’s long-term (three to five years) earnings growth rate is 6.02%. The Zacks Consensus Estimate for 2024 earnings per share (EPS) implies a year-over-year improvement of 6.6%.

AVANGRID is the third largest solar and wind generator in the United States. In Renewables, AGR reached 8.6 GW of wind and solar capacity. In addition, a total of 990 MW is currently under construction. This includes 472 MW of renegotiated PPAs and 526 MW of new PPAs signed in 2023. Nearly 700 MW of these projects are expected to support data centers with clean energy from onshore wind and solar.

AGR’s long-term earnings growth rate is 24.37%. The Zacks Consensus Estimate for 2024 EPS implies a year-over-year improvement of 7.7%.

Dominion Energy’s long-term objective is to add 24 GW of battery storage, solar, hydro and wind (offshore as well as onshore) projects by 2036 and increase the renewable energy capacity by more than 15% per year, on average, over the next 15 years.

D’s long-term earnings growth rate is 8.9%. The Zacks Consensus Estimate for 2024 EPS implies a year-over-year improvement of 51.3%.

Price Performance

In the past six months, shares of FirstEnergy have risen 4.1% against the industry’s 5% decline.

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Zacks Rank

FirstEnergy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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