NextEra Energy Partners (NEP -1.31%) offers investors the best of both worlds. The clean energy infrastructure company pays an attractive dividend. It currently yields 5.3%, several times above the S&P 500's 1.7% dividend yield. Meanwhile, it's growing its earnings and that payout at rapid rates. The company has increased its distribution by 15% over the past year.

The company expects to grow at a supercharged rate for several years. That makes it a great option for investors seeking high-powered income and upside potential.

Generating strong financial results

NextEra Energy Partners recently reported solid first-quarter results:

A slide showing NextEra Energy's earnings and cash flow waterfalls in the first quarter of 2022 and 2023.

Image source: NextEra Energy Partners.

As that slide shows, adjusted EBITDA grew by 8.5% in the quarter. The company benefited from adding 1.2 gigawatts (GW) of new renewable energy investments to its portfolio over the past year. That more than offset weaker results within its existing asset portfolio. The company experienced some headwinds from lower wind energy resources in the quarter. While wind production was 102% of its historical average in the period, it was down from 108% in the year-ago quarter. Every 1% change in wind production for the year impacts annual EBITDA by about $11 million to $13 million.

Meanwhile, cash available for distribution (CAFD) was lower by 7.7%, mainly due to the headwinds facing its existing assets, which included lower wind resources and tax credit changes.

The company expects strong tailwinds to emerge in the second half and power double-digit growth in adjusted EBITDA and CAFD. One catalyst is the acquisition of about 690 megawatts (MW) of long-term contracted wind and solar energy projects from its parent NextEra Energy (NEE -0.14%). The partnership is paying $708 million for a portfolio that should generate $110 million-$130 million of adjusted EBITDA and $62 million-$72 million of CAFD annually over the next five years. It expects the deal will close in the second quarter and support growth through next year. It should give the company all the power needed to achieve its 2023 year-end earnings and cash flow run rates.

Lots of levers to continue growing briskly

NextEra Energy Partners continues to expect it can grow its high-yielding dividend at a 12% to 15% annual rate through at least 2026. Several factors power that outlook.

The biggest power source is continued drop-down transactions from NextEra Energy. The leading utility could sell as much as 58 GW of renewables and storage assets to its affiliate. Future deals would allow NextEra Energy to recycle capital into new developments. Meanwhile, they'd supply the partnership with additional cash-flowing renewable energy assets to power its growing dividend.

NextEra Energy Partners is also pursuing 1.8 GW of potential organic expansion projects. It's evaluating opportunities to repower legacy wind farms by replacing older turbines with newer, more powerful ones. It's also looking at adding battery storage capacity to existing facilities.

The company can also pursue third-party renewable energy acquisitions as attractive opportunities arise.

NextEra Energy has many ways to finance its continued growth. The company has $2.8 billion in available liquidity. It also has interest rate swaps valued at $6 billion it could monetize to finance new portfolio additions. In addition, the company has a long history of obtaining convertible portfolio equity financing from institutional investors. This funding source helps limit dilution to existing investors by enabling NextEra Energy Partners to raise equity capital to fund acquisitions it can buy back later. Recent repurchases have seen it issue 55% and 64% fewer units than if it sold equity to fund the initial transaction.

A powerful dividend growth stock

NextEra Energy Partners expects to grow its 5%+ yielding dividend by as much as 15% annually through 2026. That's a powerful plan. It positions the clean energy infrastructure company to generate strong total returns. That makes it an excellent option for investors seeking to add a high-powered income stock to their portfolio and capitalize on the renewable energy megatrend.