Sempra Unit Starts Green Plant - Analyst Blog

Sempra Energy (SRE) announced that its unit Sempra Generation has started operation of the 48 Megawatt (MW) photovoltaic plant in Nevada. This plant can meet the electricity requirement of 14,000 average homes.

At present this 48 MW Copper Mountain Solar facility is the largest photovoltaic solar power plant in operation in the United States. The new facility is adjacent to Sempra unit's 10 MW El Dorado Solar plant. The company has entered into separate agreements for 20 years to supply all the power generated from its solar power plants to Pacific Gas & Electric (PG&E).

Sempra Energy is working to incrementally develop its renewable energy operations in the United States. The solar and wind power projects are the ones through which the company generates the majority of its renewable power. The following upcoming projects will help the company to build on its existing renewable portfolio.

The Sempra unit will begin constructing the first phase of the 600 MW solar energy project in Arizona next year. The company has received approval to develop a 200 MW solar facility in Kent County, California.

The company is also partnering with BP plc's (BP) unit BP Wind Energy in the development of a 250-MW wind project in Colorado.  The company is working on a wind project in the Sierra de Juarez mountains. Upon completion, this Energia Sierra Juarez facility will generate 100 to 125 MW of wind power.

It is worth noting that one of Sempra Energy's peers, Edison International (EIX), is also working on renewable energy projects. Recently, Edison financed a wind project in High Lonesome Mesa, New Mexico, which produces around 100 MW of wind energy.

The adjusted earnings of Sempra Energy at the end of third-quarter 2010 were $1.08 per share compared with $1.27 per share in the year-ago comparable period. During the earnings release the company confirmed its earnings guidance for 2010 in the range of $3.15 to $3.40.

The Zacks Consensus Estimates for fourth quarter fiscal 2010, fiscal year 2010 and fiscal year 2011 are 95 cents per share, $3.65 per share and $4.16 per share, respectively.

Sempra Energy currently retains a Zacks #4 Rank (short-term Sell rating). We also maintain an Underperform rating on the stock.

Based in San Diego, California, Sempra Energy, along with its subsidiaries, engages in the development of energy infrastructure, operation of utilities, and provision of energy-related products and services to its worldwide consumers.

 
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