Renewable Power Co. Hits Milestone in Utah Battery Project

Revolve Renewable Power Corp. (TSXV:REVV;OTCQB:REVVF) announced it has signed an interconnection agreement with PacifiCorp, a "major milestone" in the development of its Vernal BESS Project in Utah.

The project is an 80MWh/20MW battery storage project located about 4 miles of Vernal in Uintah County, less than a half mile from the existing transmission network in the area.

Revolve applied for the interconnection with PacifiCorp in 2022. Remaining permitting works on the project are continuing, including applying for a conditional use permit and building permit with the county, completing a plan of development and construction permit with the Utah State Land Trust, and finalizing the design for the interconnection transmission line.

"The company continues to target a ready-to-build date in late 2024/early 2025, with construction works to commence in 2025 and commercial operations in 2026," Revolve said in a release. "These dates remain subject to securing suitable offtake arrangements for the Project."

Revolve said Vernal BESS is a "key project within its utility-scale development portfolio that it intends on financing, constructing, and operating for the generation of long-term revenue and cash flow."

The company was formed in 2012 to capitalize on the growing demand for renewable power, which only continues to increase.

According to the International Energy Agency's 2024 Clean Energy Market Monitor report, clean energy growth has outpaced growth in fossil fuels by a ratio of 2-to-1.

REVV was ranked among the top ten undervalued stocks in the Utilities — Independent Power Producers industry on the TSX Venture Exchange, according to the Globe and Mail in February.

"Clean energy deployment has accelerated since 2019, partly on the back of government stimulus packages deployed to respond to the Covid-19 pandemic and 2022 energy crisis," the report said. "A number of governments around the world have also enacted major policies to support the uptake of clean energy technologies."

Revolve develops utility-scale wind, solar, and battery storage projects across North America. The company has a second division, Revolve Renewable Business Solutions, which installs and operates sub-20MW "behind the meter" distributed generation (or "DG") assets.

In total, the company now has more than 3 gigawatts (GW) of development projects in North America and just closed on its acquisition of WindRiver Power, an operator and developer of wind and hydro projects in British Columbia and Alberta.

Stock Set for Major Bull Market?

REVV was ranked among the top ten undervalued stocks in the Utilities — Independent Power Producers industry on the TSX Venture Exchange, according to the Globe and Mail in February.

The company is working toward becoming "a dedicated renewable independent power producer focused on long-term recurring revenue and cash flow," Water Tower Research analysts Shawn Severson and Graham Mattison wrote in a recent research note.

Severson and Mattison wrote that closing on the WindRiver acquisition was a "key milestone in Revolve's stated strategy of utilizing both a development strategy and acquiring operating assets."

The stock still "trades at a significant discount to its peers, even though it has delivered revenue and EBITDA, has a larger development pipeline than many of its peers, and further expected payments of US$50-60 million from the (French energy major) ENGIE transaction," the two analysts noted.

Last year, Revolve sold 1.25 GW of solar-plus-storage projects in Arizona to Engie.

Technical Analyst Clive Maund wrote in January that it looked like the stock was set to "commence a major bull market as it just starts to advance out of a large low base pattern."

Technical Analyst Clive Maund wrote in January that it looked like the stock was set to "commence a major bull market as it just starts to advance out of a large low base pattern."

"After trending steadily higher for many months in a measured manner from this low and well into 2023, it reversed into an equally measured downtrend that brought it back to the Summer 2022 lows, with which it formed the second low of a Double Bottom last Fall, and we can also see that it then started to advance out of this low," Maund wrote.

The analyst said the price broke out "sharply and decisively" last November, a move that he believed to be the beginning of a new bull market for the stock.

"The conclusion is that all the technical factors described here are converging to indicate that Revolve Renewable Power Corp. is set to embark on a significant bull market advance from the current low level, which, although it has already started, is still in its very earliest stages," noted.

Chief Executive Officer Steve Dalton has said key parts of the company's strategy include increasing the size of its assets under development and M&A activities.

The Catalyst: Market's Energy Building

According to research by Statista, electricity generation in the renewable energy market is projected to amount to more than 7.3 billion KWh in 2024, and it is expected to grow at a compound annual growth rate (CAGR) of 3.88% between 2024 and 2028.

"The energy market is expected to continue growing, with increasing demand for energy worldwide as populations grow and economies develop," the report said. "However, the mix of energy sources is expected to shift towards cleaner and more sustainable options, with renewable energy sources like solar, wind, and hydropower projected to continue growing rapidly. Fossil fuels are expected to gradually decline in importance."

Researchers at Mordor Intelligence agreed, and noted the United States share of the renewable energy market is estimated at more than 434 GW in 2024 and is expected to reach 700 GW by 2029, growing at CAGR of 10%.

Therefore, increasing investments in the sector are expected to drive the US renewable energy market during the forecast period.

"Factors such as increasing solar and wind energy installations over the period, supportive government policies, declining solar panel costs, and additional subsidies on renewables are expected to drive the renewable energy market during the forecast period," analysts wrote.

The U.S. government announced the framework to invest US$555 billion in clean energy programs, which is expected to be a big opportunity for companies in this space.

According to Deloitte Insights, renewable energy sources are set for a "variable-speed takeoff" this year. 

"The impact of unprecedented investment in renewable infrastructure will likely become more apparent in 2024," Deloitte said in its outlook for renewable energy in 2024.

"Regulatory boosts to renewable energy and transmission buildout could help address grid constraints. And boosts to manufacturing could lay the foundations of a domestic clean energy industry with stronger supply chains supporting solar, wind, storage, and green hydrogen deployment."

Ownership and Share Structure

About 60% of the company is owned by insiders and management, Revolve said.

Top shareholders include Joseph O'Farrell with 13.21%, Roger Norwich with 12.15%, the CEO and Director Stephen Dalton with 6.01%, President and Director Omar Bojoquez with 4.82%, and Jonathan Clare with 1.84%, according to Reuters and the company.

The rest is retail.

Revolve has a market cap of CA$17.02 million with 63.04 million shares outstanding and 38.08 million free-floating. It trades in a 52-week range of CA$0.62 and CA$0.20.

Important Disclosures:

1. Revolve Renewable Power Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Revolve Renewable Power Corp.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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