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Investing.com -- Shares of RWE AG (OTC:RWEOY) (XETRA:RWE (LON:0HA0)) climbed 2% today after the energy company announced a significant power purchase agreement (PPA) with Meta Platforms Inc (NASDAQ:META). The agreement pertains to RWE’s upcoming 200 MW Waterloo Solar project in Bastrop County, Texas, scheduled to begin construction in late 2025.
This deal marks the third long-term contract between RWE and Meta in the past seven months, following two solar PPAs signed in mid-August for the 274 MW County Run Solar in Illinois and the 100 MW Lafitte Solar in Louisiana, both with commissioning dates also set for late 2025.
Barclays (LON:BARC) analysts commented that this announcement will receive positive investor attention "based on the decent size of the project, Meta being the counterparty and the reference that this power is needed to hit the technology company’s sustainability goals."
"There is still a strong argument that the market is ignoring the future growth for RWE that is likely to come from data center power demand, particularly in the US where RWE is the third-largest renewables player (number 2 in US solar). This announcement provides further evidence of actual growth projects in the US supported by PPAs with technology companies."
Moreover, Barclays sees increasing evidence of AI/data center/transition-driven demand growth, "with the US leading the way with the market unjustly ignoring the major US presence of European utilities like RWE."
"The outlook for sustained power demand growth in the US represents a major paradigm shift following multi-decadal growth of near zero (CAGR over the last 25 years was only ~0.6%)," the analysts concluded.
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