American Electric Power (NASDAQ:AEP) said last week that it intends to sell some or all of its unregulated contracted wind and solar energy resources and redirect capital previously allocated to that business to its transmission assets.

Executives told financial analysts during AEP’s year-end earnings call Thursday that it plans to dispose of about 1.6 GW of renewable capacity. That will free up $1.5 billion in capital spending to its regulated transmission business between now and 2026.

CEO Nick Akins said during the call that the company is “fully confident” the portfolio’s sale will “both simplify and derisk” the business and allow it to “assign additional capital to our regulated business.”

The move doesn’t affect AEP’s regulated renewables business, which plans to add 8.6 GW of wind and 6.6 GW of solar by 2030. The company is allocating $8.2 billion of its current $38 billion, five-year capital plan to the regulated portfolio. The capital expenditure plan also includes $24.8 billion for grid investments.

“The migration from contracted renewables to significant increases in regulated renewables will ensure that AEP maintains the talent and resources to execute this plan,” Akins said.

AEP expects to close the $2.8 billion sale of its Kentucky operations, Kentucky Power and AEP Kentucky Transco, in the second quarter. Akins said he doesn’t think the recent withdrawal of a FERC filing related to a coal-fired power plant’s operating agreement to affect the timing.

The Columbus, Ohio-based company reported its “strongest-ever” fourth quarter with earnings of $538.9 million ($1.07/share). A year ago, quarterly earnings were $435.5 million ($0.88/share).

AEP’s year-end earnings were $2.49 billion ($4.97/share), compared to $2.2 billion ($4.44/share) in 2020.

Wall Street reacted favorably to the news, driving AEP’s share price up 5.7%, from $84.64 before the earnings announcement to $89.46.

Vistra Recovers from Winter Storm

Vistra (NYSE:VST) on Friday brought a tough year to a close by delivering $1.94 billion in year-end adjusted EBITDA from ongoing operations. A year ago, the Texas-based company reported $3.77 billion in adjusted EBITDA from ongoing operations a week after February’s devastating winter storm that eventually inflicted a $1.6 billion hit.

Last year “was undoubtedly a challenging year and, in many ways, a pivotal one for Vistra. … The financial strength we worked so hard to put in place was challenged,” CEO Curt Morgan told financial analysts during a conference call. “I’m proud of how our team came together to not only confront and mitigate the impact, but to then shift to building a stronger company. That strong balance sheet we built and the resilience of our team helped us stabilize the company and ultimately get back on track within months.”

Executives said Vistra was able to “derisk” the company after the storm and shift its strategic direction; begin an improved capital allocation plan with substantial share repurchases; and accelerate Vistra Zero, its portfolio of zero-emission resources. Vistra has announced plans to operate 7.3 GW of zero-carbon generation by 2026, a number that includes its 2.3-GW Comanche Peak Nuclear Power Plant. The company plans to bring two solar facilities offering 158 GW of power and a 260-MW energy storage facility online by this summer.

The company reduced debt by about $625 million during the fourth quarter and is on target to reduce debt by $1.5 billion by the end of 2022.

“We feel like we’ve turned the corner here and strengthened our company,” Morgan said in closing the conference call.

For the quarter, adjusted EBITDA from ongoing operations was $1.17 billion, compared to $802 million for the same period in 2020.

Vistra’s share price gained 22 cents Friday, closing at $21.90. It had dropped to $17.25 in February after the company disclosed its winter storm losses. (See Vistra Stock Plunges After Market Losses.)

OGE Turns in Solid Year

OGE Energy (NYSE:OGE) on Thursday reported year-end earnings of $737.3 million ($3.68/diluted share), compared to a net loss of $173.7 million ($0.87/diluted share) for 2020.

For the quarter, earnings were $319.2 million ($1.59/diluted share), up from $54.8 million ($0.27/diluted share) for the year prior.

Most of the gains came from OGE’s Oklahoma Gas & Electric subsidiary, which turned in 2.4% load growth and increased revenues from capital investment recovery. That was partially offset by the February winter storm’s effects and higher depreciation on a growing asset base.

“Every single employee contributed to the excellent results we delivered this year especially when you consider the headwinds we faced in early 2021,” CEO Sean Trauschke said in a statement.

The Oklahoma City-based company forecasts long-term utility earnings growth of 5 to 7% per share.

OGE’s share price gained $1.75 and finished the week at $37.18, a 5% increase following the earnings announcement.