WEC Energy Keeps Natural Gas, LNG in Focus as it Plots Renewables Transition

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Researched by Industrial Info Resources (Sugar Land, Texas)--A recovering economy, improved operational efficiency and scorching summer temperatures gave WEC Energy Group Incorporated (NYSE:WEC) (Milwaukee, Wisconsin) a solid boost in its recently ended second quarter, as consumption from residential, commercial and industrial customers grew substantially from the same period last year. The company, which mainly serves Wisconsin, Iowa and Michigan, is reinforcing much of its gas-generation and delivery network while anticipating long-term growth in renewable sources. Industrial Info is tracking about $745 million in active projects from WEC, about 40% of which is nearing or under construction.

Click on the image at right for a graph detailing WEC's active projects, by industry sector.

Earlier this year, WEC announced it would spend $16.1 billion over the next four years to reduce its carbon emissions and meet its environmental goals, including $4 billion on new, renewable-generation projects. The company committed to a 60% reduction in carbon emissions at its power-generation plants by 2025, from 2005 levels, and an 80% drop by 2030. Previously, it had committed to a 70% reduction by 2030. WEC already had pledged last year to become net carbon neutral by 2050.

Last month, WEC agreed to acquire a 90% ownership interest in Invenergy LLC's (Chicago, Illinois) estimated $300 million Sapphire Sky Wind Energy Center in Bellflower, Illinois, subject to necessary regulatory approvals. The project, which comprises 64 wind turbines with a total capacity of 250 megawatts (MW), brings WEC's total wind-energy capacity to 1.5 gigawatts (GW). The Sapphire Sky project already is signed to a long-term power purchase agreement with an unnamed "Fortune 100 global, high-tech company," according to WEC. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can learn more from Industrial Info's project report.

Within its usual three-state territory, WEC's subsidiaries are seeking permits for a proposed repowering of the Crane Creek Windfarm in Riceville, Iowa, which would repair blades and boost efficiency for 66 turbines at the 99-MW facility. If approved, the project could begin construction in first-quarter 2022. Subscribers can learn more from Industrial Info's project report.

WEC's capital expenditures and asset acquisitions totaled $1.1 billion for the first six months of 2021, a $93 million increase when compared with the first six months of 2020. Executives expect working capital to continue to improve throughout the remainder of the year.

"Our long-term goal remains net-zero carbon emissions from our generating fleet by 2050," said Gale Klappa, executive chairman of WEC, in a recent quarterly earnings-related conference call. "And our ongoing effort to upgrade our gas delivery networks and introduce renewable natural gas into our system will help us achieve another aggressive goal, net-zero methane emissions by 2030."

WEC is at work on the $45 million Omo Road Natural Gas Compressor Station near Mount Clemens, Michigan, which will be connected to subsidiary Bluewater Gas Storage LLC's mainline pipeline in Macomb County, Michigan, and is performing a $20 million uprate of Turbine 2 at its Fox Energy Center in Kaukauna, Wisconsin, which will raise the turbine's output from 199 MW to about 209 MW. Subscribers can learn more from Industrial Info's reports on the Omo Road and Fox Energy Center projects.

WEC also is wading into the market for small-scale liquefied natural gas (LNG) services, which are becoming increasingly popular in geographic areas facing pipeline constraints that hinder gas supplies. Such service providers can tap into pipelines during maintenance events to keep supplies flowing, as well as provide supply in remote and stranded areas with limited or no access to gas pipelines, according to Natural Gas Intelligence. One such method is "peak shaving," a process that stores surplus LNG to be used during peak-demand periods for small-scale applications, such as power generation at individual industrial plants.

WEC is in the engineering phase of an upcoming $185 million peak shaver near Bluff Creek, Wisconsin, which will process, cool and store LNG to serve the state's southernmost areas. A proposed $185 million peak shaver near Ixonia, Wisconsin, is designed to service the greater Milwaukee area for 10 days during winter, as well as some of the colder days in April. Subscribers can learn more from Industrial Info's reports on the Bluff Creek and Ixonia projects.

WEC reported net income of $276 million for the second quarter of 2021, a 14.2% increase from the second quarter of 2020. Operating revenues stood at $1.68 billion, an 8.2% increase.

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.