This Big-Time Passive-Income Producer Has the Wind at Its Back

Clearway Energy (NYSE: CWEN)(NYSE: CWEN.A) is becoming an excellent stock for those seeking to generate some passive income. The company owns a growing portfolio of clean power generating assets secured by long-term contracts. Those agreements provide it with a sustainable income stream to support its lucrative dividend, which currently yields around 4%.

Clearway Energy believes it can grow that big-time payout toward the upper end of its 5% to 8% annual target range through 2026. It recently secured more power to increase its dividend payment, making that high-end growth rate even more achievable.

Clearway Energy has agreed to buy a portfolio of operating wind energy projects from Capistrano Wind Partners. The company is paying $255 million in cash for the portfolio, plus the assumption of $160 million in debt. The portfolio comprises five utility-scale wind farms in Texas, Nebraska, and Wyoming with 413 megawatts of generating capacity. They began operations between 2008 and 2012 and sell power under long-term power purchase agreements with a weighted average remaining contract term of about 10 years. They should supply the company with relatively steady cash flow for the next decade.

Source Fool.com