Algonquin Power & Utilities (TSE:AQN) is a multi-national renewable energy and utility company with headquarters in Canada and operations across North America. The company was first formed in 1988 as a private entity that went public on the Canadian market. The company went public in 1997 as Algonquin Power And Income Fund and has seen explosive growth in the time since. The stock is a member of the TSX 60 Index and is traded with a dual listing on the NYSE.
The IPO, on the Toronto Stock Exchange raised nearly $75 million and led to the purchase of 14 hydroelectric power plants in Canada, New York and New Hampshire. The company elected to give up its trust status in 1997 following changes to regulations in Canada that removed the preferred status for the business. The change resulted in the company traded today, Algonquin Power & Utilities, which operates a vast network of renewable power-generating and utility assets via three subsidiary companies.
Subsidiaries of Algonquin Power & Utilities Corp are Bermuda Electric Light Company, Liberty Power and Liberty Utilities. The company owns and operates a diversified and integrated portfolio of regulated and non-regulated power generation, distribution, and transmission assets through its subsidiaries.
The company operates through two segments, generating renewable energy for consumer use or selling to other utilities and utilities providing power, water and natural gas. The two operating segments are Regulated Services Group and Renewable Energy Group. The company’s portfolio of assets is focused on hydroelectric, wind and solar power generation. On a dollar basis, the utility-end of the business is by far the largest and generated roughly 75% of the revenue in 2022. Total revenue in 2022 topped C$3.25 billion.
The Regulated Services Group operates rate-regulated utilities located in the United States, Canada, Chile, and Bermuda. The Renewable Energy Group segment generates and sells electrical energy and capacity generated by its power-generating portfolio in the United States and Canada. The company’s Regulated Services Group has operations in 13 US states, and 1 Canadian province and assets are worth in excess of $10 billion as of 2022. The Renewable Energy Group owns 41 power-generating facilities with a total generating capacity of 2.3 gigawatts.
Algonquin Power & Utilities’ business is built on the pillars of growth, operational excellence and sustainability. The growth is driven by organic initiatives, acquisitions and the developing of its industry-leading portfolio of green-power assets. Operational excellence is the focus on safety and reliability while providing profitability and cash flow for investors. Sustainability is the belief that green-power generation is the future for humanity and is seen in the goal of reaching net zero GHG emissions by 2050 and aggressive goals for the interim. Among those are generating at least 75% of from renewable sources.
Algonquin Power & Utilities aims to deliver shareholder returns through earnings, capital gains and dividends. The stock pays a quarterly dividend, and investors can also enroll in a dividend reinvestment plan.
