By Michael Kuser
Declining wind output drove down Avangrid’s first-quarter earnings by 11% compared to a year earlier, company officials said last week.
Avangrid posted net income of $217 million ($0.70/share), down from $244 million ($0.79/share) in the same quarter a year ago. The drop was driven primarily by a $46 million decrease in the company’s Renewables business, from $50 million in Q1 2018 to $4 million this year. Wind production during the period averaged 14% below 2018 levels, reflecting “the impacts of storms and severe weather,” CFO Doug Stuver said in an earnings call Thursday.
The drop in the Renewables business was partially offset by an $18 million increase in the company’s Corporate segment “due to favorable tax impacts,” Stuver said.
Total revenue for the quarter was down by 1.2%, from $1.865 billion in 2018 to $1.842 billion.
CEO James Torgerson told analysts that despite the hiccup in wind output, Avangrid expects nearly 1 GW of renewables under construction to come online this year and has increased its pipeline by 1.6 GW to 15.4 GW, which includes 4.4 GW of solar.
Its Vineyard Wind offshore project, a joint venture with Copenhagen Infrastructure Partners, is on track, “with nearly 70% of the supply chain secured,” Torgerson said. The project’s contracts with the electric distribution companies recently received Massachusetts Department of Public Utilities approval. “Now, we are targeting to have all 800 MW in operation by the end of 2021,” he said.
With their Liberty Wind project, Avangrid and Copenhagen also submitted a bid in New York’s first offshore wind solicitation, with options for 400, 800 and 1,200 MW. (See Four Bidders Vie for NY Offshore Wind Project.) The New York State Energy Research and Development Authority is expected to announce the winner this spring.
The companies also submitted to Rhode Island two proposals of 200 MW and 300 MW each, with the selection of bidders expected in May.