Warren Buffett is in bed with solar a second time this month reports Bloomberg.
On December 7, his MidAmerican Energy Holdings, which is a subsidiary of Berkshire Hathaway, agreed to purchase the $2 billion Topaz power plant in its entirety from First Solar Inc. (FSLR). More recently, Buffett’s “MidAmerican Energy Holdings agreed to buy a 49 percent stake in NRG Energy Inc. (NRG)’s $1.8 billion Agua Caliente solar project.”
The 290-megawatt solar power plant is being built by FSLR in Arizona. The company expects to have installation of the solar panels completed by 2014.
Utility-scale projects, like Agua Caliente, tend to offer solid returns with little downside risk. For instance, in this case, the plant itself already has a $967 million loan guarantee in police from the U.S. Energy Department and its power is already under a 25-year contract with PG&E Corp. The price of the contract not not disclosed. In addition to the solidity of this sort of project, because the energy is solar, tax credits may also be available.