Westar Energy, Inc. WR has inked a 20-year power purchase deal with a unit of NextEra Energy, Inc. NEE. Under the terms of the agreement, Westar will purchase 200 megawatts (MW) of wind energy from Kingman Wind Energy Center in Kansas.
The wind farm is expected to be operational by early 2017. Westar also retains the right to purchase a 50% stake in the project prior to its completion.
Westar Energy is the largest electric utility in Kansas. Westar has 7,200 MW of electric generation capacity fueled by coal, uranium, natural gas, wind and landfill gas. The utility has been investing substantially in developing wind power in the state. Recently, Westar joined forces with the developer Infinity Wind Power Inc. to construct a 280 MW wind project in Ford County, KS. The Western Plains Wind Farm will source wind turbines from Siemens.
These investments are expected to boost Westar’s wind energy portfolio to over 1,700 MW by early 2017.
Globally, utilization of renewable energy is rising primarily due to a growing awareness among the masses regarding its benefits. The Paris climate deal, inked with the support of representatives from 195 countries, along with the extension of the environmental tax credit is acting as an impetus for renewable companies.
Particularly for the wind industry, the Production Tax Credit, which originally expired at 2013 end due to Congressional gridlock, has been extended through 2020. The Paris climate agreement commits developed and developing countries to lead in eliminating net greenhouse gas emissions in this century. The deal calls for developed nations to substantially invest in renewable power generation to achieve the targets specified in the agreement. This will definitely provide a boost to the development of renewable energy.
Zacks Rank
Westar Energy carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the electric utility space are Abengoa Yield plc ABY and Korea Electric Power Corp. KEP, both sporting a Zacks Rank #1 (Strong Buy).
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