AES Ratchets Up Renewable, Natural Gas Projects Across Americas with $12 Billion-Plus in Projects

Researched by Industrial Info Resources (Sugar Land, Texas)--AES Corporation (NYSE:AES) (Arlington, Virginia) made big strides in growing and diversifying its portfolio in second-quarter 2018, including solar and wind-powered projects in the U.S. and a variety of gas-fired plants throughout the Americas. AES executives said that of the remaining 3.9 gigawatts (GW) worth of projects under construction, they expect 2 GW worth to be commissioned before the end of the year. Industrial Info is tracking more than $12 billion in active projects involving AES, about 25% of which is attributed to projects under construction.

Click on the image at right for a graph detailing the top 10 U.S. states for AES projects, by investment value.

Renewable energy accounts for about 75% of the 11.8 GW of new capacity that AES expects to add through 2022. Many of these projects are attributed to Sustainable Power Group (sPower), which AES acquired last year. Among the 5.7 GW worth under construction are:

• $750 million Highlander Solar Plant in Thornburg, Virginia, which would generate 500 megawatts (MW) from photovoltaic (PV) modules; see project report
• $600 million Spotsylvania Solar Energy Center in Spotsylvania, Virginia, which would generate 500 MW from PV modules; see project report
• $240 million Prevailing Winds Windfarm in Avon, South Dakota, which would generate 220 MW from 95 turbines; see project report
• $46 million Kauai Solar & Battery Storage Plant in Waimea, Hawaii, which would generate 28 MW from crystalline PV modules; see project report

AES also is seeking permits for the estimated $95 million Sand Hill Windfarm in Alameda, California, which would generate 49.6 MW from 25 turbines. As currently scheduled, the project would begin construction in early 2020. For more information, see Industrial Info's project report.

"Overall, about 50% of our renewables growth is wind, more or less, 50% is solar, 50% is in the U.S., 50% is outside [the U.S.]," said Tom O'Flynn, the chief financial officer of AES, in an earnings-related conference call.

Among AES' biggest accomplishments in the past quarter was its completion of the $600 million IPL Eagle Valley project in Martinsville, Indiana, a natural gas-fired, combined-cycle (NGCC) project that generates 671 MW from two combustion turbines, two heat-recovery steam generators and a steam turbine, all provided by General Electric (NYSE:GE). Eagle Valley had hit several roadblocks during its construction, including heavy charges in 2017 related to performance issues with Chicago Bridge & Iron prior to its acquisition by McDermott. For more information, see Industrial Info's project report.

"We brought online the 671-MW Eagle Valley Combined Cycle Gas Plant in Indiana in April, and we will be inaugurating the 380-MW CCGT and LNG regasification terminal Colon in Panama later this month," said Andrés Gluski, the chief executive officer of AES, in the conference call.

AES Panama's $450 million CCGT plant in Colon, Panama, will use three GE combustion turbines and a Siemens steam turbine to generate 380 MW, while its $200 million LNG regasification and import terminal will store 37 million standard cubic feet of natural gas capacity and 180,000 square meters of LNG. For more information, see Industrial Info's project reports on the CCGT plant and terminal.

AES is nearing completion on another major South American project: the Alto Maipo hydropower complex in Limache, Chile. The 267-MW, $450 million Las Lajas plant and the 264-MW, $450 million Alfalfal plant each will use water from the El Volcan River to drive a pair of underground turbines. For more information, see Industrial Info's project reports on the Las Lajas and Alfalfal portions of the project.

"AES Gener successfully restructured the Alto Maipo hydroelectric project in Chile in May," Gluski said in the conference call. "Since closing the restructuring, the main contractor (Strabag SpA) is performing in line with the revised EPC contract and has been meeting the agreed upon construction milestones. Alto Maipo is now 68% complete, including 56% of the tunneling work, and the rate of progress on tunneling has significantly improved as of late. We expect Alto Maipo to achieve commercial operations in 2020."

AES' total revenues for the second quarter were reported to be $2.54 billion, a 2.9% decrease from second-quarter 2017, but net income stood at $290 million, compared with $53 million in the same period last year.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.