Boston, MA 05/01/2014 (wallstreetpr) – El Paso Electric Company (NYSE:EE) is a $1.5 billion electric company that generates and distributes electricity. The company’s service areas include Texas and southern New Mexico with 10,000 sq miles coverage.
The company has earned a “buy” rating from analysts at Jefferies. Due to lack of any appeal against the company’s permit to construct power stations in El Paso, the analysts at Jefferies deemed it fit to upgrade the stock from a “hold” to a “buy” in the latest note to investors. The firm has a 12-month price target of $41.50 on the stock. Shares of the company currently trade in the range of $37.46.
El Paso Electric Company (NYSE:EE) generates electricity from natural gas. It also has solar power projects that are expected to complement its renewable energy portfolio. The demand for energy is pushing the company to make additional investments in energy generation, and it recently received a permit award for four power plants. Without anyone to challenge the permit within the 30 days window of opportunity, the company is now cleared to go ahead with the construction of the new power plants.
Natural gas power plants
The company intends to build about four natural gas powered electricity plants. Two of the power stations are expected to commence operations by May 2015. The timing is such that the company can meet the summer peak in power demand.
Cost and capacity
El Paso Electric Company (NYSE:EE) expects to invest about $372 million in the project for energy generation capacity of 352 megawatts. That energy capacity will be enough to power more than 150,000 homes. The project is primarily part of an effort by the company to increase its energy capacity to ensure better customer experience. As such, the company is also working on additional energy projects mainly based on solar. The company expects to add about 167 megawatts of solar energy to its grid in 2014.
