Boston, MA 04/29/2014 (wallstreetpr) – The $16 billion energy utility holding company Xcel Energy Inc (NYSE:XEL) has placed out a call for bidders to develop its solar power farms. In making the move, the company seeks to comply with the Minnesota’s renewable energy requirement. The state requires certain energy utilities to generate at least 1.5 percent of their electricity from solar.
As such, Xcel wants to build an additional solar power capacity of 100 megawatts by end of 2016. The company placed request for proposal last week, and it expects to select developers by June after which negotiations can be done in August and commissioning of the projects to come soon after.
The request for proposal from Xcel Energy Inc (NYSE:XEL) is likely to generate bid wars among solar developers as there have been few large-scale solar project opportunities coming out in recent times. In fact, major solar companies have been turning to the rooftops to supply residential, commercial and industrial supplement with cleans and reliable electricity.
To generate 1.5 percent of its energy capacity from solar, Xcel will need to set up solar farms that are capable of generating up to 300 megawatts by 2020.
Besides making solar investments comply with the mandatory requirements, the company also expects to provide reliable and cheap power to customers from its solar farms.
Tax credit
Xcel Energy Inc (NYSE:XEL) expects to complete the 100-megawatt solar farm project by 2016 so that it can benefit to the tax credit extended to solar developers. That means that the company will experience some cost cushion in the project.
Besides the latest bid, the company is also in another 100-megawatt solar farm project agreement with Geronimo Energy. That project involves building of about 20 solar parks with combined energy capacity of 100-megawatts.
Renewable investment
Xcel Energy Inc (NYSE:XEL) has everything to benefit from its ambitious renewable energy investments. In addition to regulatory compliance, improvement in energy generation capacity and reliability, the company will also improve its carbon rating by reducing its greenhouse footprint that is good for a company that values a good name.
