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January 03, 2013

Warren Buffet's MidAmerican Energy Buys World's Largest Solar Development



In his most recent deal, Warren Buffett, arguably the most successful investor of the 20th century, is putting his money—between $2 billion and $2.5 billion of it—in two solar energy projects. Together, the projects will constitute the largest permitted solar photovoltaic power development in the world and will create an estimated 650 jobs during construction.

On January 2, MidAmerican Energy Holdings, a subsidiary of Buffet’s Berkshire Hathaway investment company, agreed to acquire and build two projects in California from Silicon Valley-based PV solar manufacturer SunPower Corporation. The Antelope Valley Solar Projects— two co-located projects in Kern and Los Angeles Counties — will generate a cumulative 579 megawatts (MW) of grid-tied energy, which will be sold directly to Southern California Edison (News - Alert) (SCE) under long-term power purchase contracts approved by the California Public Utilities

This marks the third time within the past year that Buffett has splurged on solar energy. He has created a unit within MidAmerican, called MidAmerican Renewables, to support an increasing number of solar and wind investments.

“We are pleased to be working with SunPower on this project. MidAmerican Renewables…has a total portfolio of more than 1,830 MW of owned assets, including wind, geothermal, solar and hydro assets," said Bill Fehrman, president of MidAmerican Renewables. "We are excited about these projects because they support our core business principle of environmental respect. We are very proud to add SunPower technology to our portfolio of projects."

"The Antelope Valley Solar Projects mark an historic milestone for the energy industry," said Howard Wenger, SunPower president, Regions. "We are delivering highly reliable low-cost renewable energy at a very large scale. SunPower is proud to partner with MidAmerican Solar and SCE, recognized leaders in clean energy development, bringing critically needed jobs and economic opportunity to California and helping the state achieve its renewable portfolio requirement."

"SCE appreciates the opportunity to work with SunPower and MidAmerican Renewables to meet California's renewable energy goals," said Nicole Neeman Brady, SCE's director of Contracts, Renewable and Alternative Power.

SunPower developed the co-located Antelope Valley Solar Projects over the last four years. At the 3,230-acre site, SunPower will install the SunPower Oasis Power Plant product, fully integrated, modular solar technology that is engineered to rapidly deploy utility-scale solar projects while minimizing land use. The Oasis product uses high-efficiency SunPower solar panels mounted on SunPower T0 Trackers, which position the panels to track the sun during the day, increasing energy capture by up to 25 percent. In addition, SunPower will be the engineering, procurement and construction (EPC) contractor; and will operate and maintain the facility via a multiyear services agreement. Construction of the solar project is scheduled to begin in first quarter 2013.

AVSP has secured final conditional use permits and has completed full environmental review pursuant to the California Environmental Quality Act.

According to estimates provided by the U.S. Environmental Protection Agency, the project is expected to offset more than 775,000 tons of carbon dioxide (CO2)emissions per year, which is equivalent to removing nearly three million cars from California's highways over 20 years of the plant's operation.

MidAmerican Solar's projects also include the 550-megawatt Topaz Solar Farms in San Luis Obispo County, California, and a 49 percent ownership interest in the 290-megawatt Agua Caliente solar project in Yuma County, Arizona

"We are pleased to be working with SunPower on this development and look forward to establishing a mutually beneficial relationship with Southern California Edison as our customer for energy generated by this project. As we have done at our other solar project locations, we will work hard to establish positive and productive relationships with community and county neighbors and stakeholders," said Paul Caudill, president, MidAmerican Solar.

SunPower has more than 1,000 MW of solar power plants operating worldwide– including the first 130 MW of the 250-megawatt California Valley Solar Ranch, which is under construction in San Luis Obispo County, California. SunPower is 66 percent owned by France’s Total SA (FP) and has a market value of $732 million, according to data compiled by Bloomberg (News - Alert).

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Edited by Brooke Neuman


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