Planet Gore

Warren Buffett Buys Cali Solar Farm

The Los Angeles Times reports:

Buffett investment in California solar farm could boost industry MidAmerican Energy Holdings agrees to buy a photovoltaic farm in San Luis Obispo County.

The investment by Warren Buffett could signal that ‘it’s time to take solar power seriously.’

The agreement by investor Warren Buffett’s MidAmerican Energy Holdings to buy a $2-billion photovoltaic farm in San Luis Obispo County could bring a ray of financial sunshine to the battered solar-energy industry.

The scale of Buffett’s foray into this sector of the renewable energy scene is considerably more modest than his $34-billion purchase of BNSF Railway, but it could provide the same kind of boost to the solar power business that the 2009 acquisition did to the railroad industry, experts said.

“In a lot of ways, this is classic Warren Buffett,” said Bruce Bullock, executive director of the Maguire Energy Institute at Southern Methodist University. “He comes into an industry that is starving for capital investment. At the same time, this is something that also tells people it’s time to take solar power seriously.”

MidAmerican is buying the 550-megawatt, thin-film photovoltaic solar energy development called Topaz Solar Farm from First Solar Inc. of Tempe, Ariz., the two companies said Wednesday. How much the Berkshire Hathaway Inc. subsidiary is paying for the solar project, which will be able to generate electricity for about 160,000 homes, wasn’t disclosed.

First Solar will build and operate the solar plant for MidAmerican, the companies said.

The rest from the Times here.

And what doesn’t the Times tell its readers?

The terms of the deal. For what price did one of Presidential Obama’s biggest supporters buy the plant?

The price isn’t important you say? Well, considering that this project tried — and failed — to win a DOE loan Buffett’s involvement is curious. In one respect, it’s classic Buffett. He’s buying an asset at a time when its price is in the dumps. But on the other hand, when you have someone who is at the right hand of the president able to buy an asset whose value was depressed because of a government decision, that deserves a bit of scrutiny. It also should be noted that First Solar, the seller in the Buffett purchase, is a beneficiary in other DOE loans. Trust, but verify.

If the Buffett deal is on the up-and-up, which I expect it is, it shows that there really is no need for the DOE loan program at all. There’s plenty of capital for alternative energy projects when the price is right.

Thanks, Warren, for helping show that President Obama’s energy “investments” are not needed. Keep up the good work!

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