Power sector: Are new tailwinds emerging from an unlikely source? 7 power sector stocks with upside potential of up to 42%
Investment Ideas
Synopsis
Power is a sector where demand always exceeds supply. The question has always been about the ability to pay. One of the reasons the sector went south was that the state electricity boards – its main customers – were in bad shape. Today, they are better placed. Now, a new set of customers is on the horizon – with no issue about paying for the power they consume. They are, in fact, loaded with money; the only thing they are looking for when it comes to power is how it is generated. This probably marks a new era for the power sector, unimaginable even two years ago. Does it mean that power sector stocks need to be looked at with a different lens once again?
If you have not heard of these words, get ready to hear them more often very soon. Carbon free energy (CFE) and power purchasing agreements (PPAs) between two large companies for the supply of energy for 15 to 25 years. Yes, we are talking about PPAs between two private sector companies – and not between state governments and power companies. It’s already happening. Three PPAs have been signed. But because they have been signed with some global
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