(Montreal) Boralex has submitted bids for a series of calls for tenders to produce solar energy in New York State, the Kingsey Falls company confirmed on Friday. The total potential output could reach up to 800 megawatts (MW).
The renewable energy producer presented its proposals in late August to the New York State Energy Research and Development Authority. The answer should be known “over the next few months,” the company said on the sidelines of the release of its third quarter results.
Although management said it was preparing to participate in the process in its previous results in early August, Bill Cabel of Desjardins Capital Markets said this is important news for the company. “It’s a huge offer and we are looking forward to the results,” he comments.
During a conference call with analysts, Boralex President and CEO, Patrick Decostre, was questioned about the relationship between the cost of projects and the price obtained for the electricity produced. The shortage of labor and the increase in the cost of materials bring potential sources of inflation on construction sites.
The leader assures that the company has taken into account the risks associated with inflation in its 800 MW bids in New York. “I think that’s reflected in the prices we offered,” he replies. Generally speaking, we will not be taken by surprise, as this has been taken into account. ”
Boralex has already been selected for five projects in a previous call for tenders in New York State for a total of 200 MW. For these contracts, Boralex reassessed their profitability in light of the most recent economic developments. “We are still in an area where these projects are interesting,” he says.
New Yorkers’ appetite for energy
New York State wants renewable energies to represent 70% of its energy consumption by 2030. Boralex is not the only Quebec company to have major contracts there.
At the end of September, Hydro-Quebec announced a 25-year contract with New York State. From 2025, the state-owned company will provide it with nearly 10.4 terawatt-hours of electricity, which represents the electricity consumption of approximately one million households.
This agreement opens up business opportunities for Boralex, believes Mr. Decostre. By exporting its hydroelectricity to New Yorkers, the crown corporation “will create a need in Quebec”. “They are going to need new sources of energy. ”
Last week, Hydro-Quebec mentioned that it expected electricity demand in Quebec to increase by 12% from 2019 to 2029, in part due to the electrification of the economy. It plans to launch two calls for tenders, for a total of 800 MW, of renewable energy this fall.
At the end of October, Innergex and Hydro-Québec also jointly acquired two hydroelectric facilities in New York producing 60 MW.
Weather situation
Weather conditions impacted energy production during the three-month period ended September 30, as did Innergex, which released its results on Wednesday.
Boralex’s wind power generation in France was 20% below the historical average. Solar energy production, for its part, is 10% below average.
“The contribution of acquisitions and commissionings over the past year as well as favorable hydraulic conditions in the eastern United States more than offset the less favorable wind conditions in Canada and France compared to the third quarter of 2020 “, Argued Mr. Decostre in a press release.
The company nonetheless increased its total production to 1,108 gigawatt hours (GWh), which represents an increase of 40%.
Boralex recorded a net loss of 22 million, compared to a net loss of 8 million for the corresponding period last year.
Consolidated earnings before taxes, interest, depreciation and amortization (EBITDA) reached $ 93 million, up 12%. Before the publication of the results, financial analysts polled by Refinitiv expected on average such a profit of 90.6 million.
In the afternoon, Boralex shares gained $ 0.83, or 2.24%, to $ 37.96 on the Toronto Stock Exchange on Friday.