August 8, 2018 Read More →

Global utility company AES sees 12-gigawatt capacity growth by 2022 driven largely by renewables

S&P Global Market Intelligence ($):

AES Corp. executives have laid out an ambitious plan to add nearly 12,000 MW of new capacity to the company’s portfolio by 2022, fueled in large part by the rapid development of the sPower renewables pipeline.

“Our goal is to earn attractive returns while greening our portfolio,” AES President and CEO Andrés Gluski said Aug. 7 on the company’s second-quarter 2018 earnings call.

AES has signed 1,500 MW of long-term power purchase agreements so far this year and is on track to exceed its internal projection of 2,000 MW for the full year, Gluski said.

The company attributed a significant portion of this growth to renewable energy developer sPower, which AES bought in 2017 through a joint venture with Alberta Investment Management Corp. AES in February 2017 predicted sPower’s development pipeline of more than 10,000 MW of renewable energy projects would initially deliver about 500 MW of signed PPAs per year.

Gluski pointed out that year-to-date sPower has about 1,200 MW of renewable capacity locked into long-term contracts with large corporate customers, such as Microsoft Corp. and Apple Inc., as well as utilities. “This is more than double the 500 MW annually of signed PPAs that we expected to achieve when we acquired sPower last year,” Gluski said.

“The business has outperformed our expectations since we acquired it, both from an operational and development perspective,” AES Executive Vice President and CFO Thomas O’Flynn said on the call.

Because of sPower’s contributions, AES is now “on pace” to sign 2,000 MW to 3,000 MW of new renewable PPAs annually in 2019 and 2020, Gluski noted. “This would result in 7.5 GW of new renewable PPAs being signed through 2020, all of which would be online by 2022.”

More ($): AES exceeding portfolio growth targets through long-term contracts


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