Maybe Warren Buffett’s purchase of a California solar farm will finally force a recognition of the potential of solar energy from an economic standpoint. Since the dissolution of Solyndra, oil-besotted conservative lawmakers have dismissed this potential, saying that the industry was simply unprofitable. When Buffett makes an investment, that becomes a harder sell:
Buffett’s MidAmerican Energy Holdings will take over Topaz Solar Farm, which is expected to produce enough power to run 160,000 homes when it is up and running in 2015. The farm, halfway between Los Angeles and San Francisco, is the world’s second-largest photovoltaic plant under construction and is expected to generate 550-megawatts of electricity or about half the power of a nuclear reactor.
The deal comes hot on the heels of a string of green energy investments by the famous investor. MidAmerican, which is part of Buffett’s Berkshire Hathaway empire, is the largest wind energy provider in the US where it operates more than a dozen wind farms.
I know there’s a theory out there on the fringe right that Warren Buffett is some kind of communist, but in reality he’s a straight-up capitalist. And he sees solar energy – and wind energy, for that matter – becoming cheaper to produce, approaching the cheapness of coal. He also sees that coal-fired power plants cannot survive, because of a combination of polluters finally having to pay for their externalities, competition from other energy sources and just basic economics.
The North American Electric Reliability Corp. says in its most recent report that the main new sources of power added to the grid in the immediate future will be natural gas, solar and wind power projects.
For example, in late November, SolarCity and Bank of America-Merrill Lynch announced financing for a five-year plan to build $1 billion in solar power plants near military housing across the country, providing 300 megawatts of power.
This comes as about 48 gigawatts of coal retirements at 231 plants will have retired from 2010 to 2022, according to the Edison Electric Institute. That’s 14.1 percent of the total 339,000 megawatts of coal-fired power generation in 2010, or about 5 percent of overall power. M.J. Bradley & Associates — a firm representing many power plants in favor of the rules — keeps a list that currently includes 228 power plants set to retire in the next several years. All except six are more than 30 years old; the majority are older than 50 years.
You can consider this a socialist plot, but actually market forces have spoken. Yes, politics plays a role with tax credits and EPA rules. But those too are a response to a market that will increasingly no longer favor coal.




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thank you, some good news.
I want more solar, but Buffett’s a player.
On Sept 16, 2008, Paulson announced an $85 billion bailout of AIG. A couple days later, Buffett announced a $5 billion purchase of Goldman shares.
Sometime between March 2009 (Dodd debacle) and January 2010 (David Federer column in HuffPo), we all came to learn that AIG was little more than a backdoor bailout for Goldman Sachs.
I know Buffett has a reputation for being clean, but I’ve put that reputation on hold until we have a POTUS and AG who demand accountability… beginning with a proper investigation of all-things-bailout.
I just find it hard to believe that Lord Blankfein’s people got that call from Buffett’s people about a possible investment and nobody mentioned that so much of Goldman’s investments were sitting with AIG.
If such information sharing occurred in The Land of the Little People, it would be called insider trading.
Again, I’m not saying there was any insider trading. I’m just saying that there has been no investigations, no transparency, no accountability about any of this. And there absolultely must be, if we’re to move forward.
yes, good news indeed. But the folks who want to have environmental sustainability need to stop invoking market logic as justification for going green. Markets can’t account for the total social costs of ecological destruction or loss of resources in the future. Prices just don’t “price out” into the future. Capitalism in inherently premised on negative externalities of using resources and causing pollution today and letting future generations bear the burden of these costs. This is the real reason why the right hates global warming. They understand that serious changes in economy must be made and that these changes are inherently antithetical to profits in a market place (carbon trading is a joke – carbon taxes are inevitable). Eventually carbon taxes will get so high that markets will seize up and it will be necessary to rationally plan the largest chuncks of the economy (Walmart, GE and GM already do massive amounts of internal planning). Environmental crisis, not the working class, is the grave digger of capitalism. We on the left should accept this and make our arguments about technical efficiency, real utility, and sustainability and stop (even when it bounces our way) making arguments along the lines of profitability and how markets respond.
Buffet buying in to solar is a watershed event. This guy is the de facto smartest investor in the country. This move by Buffet makes the entire solar energy industry in the US noteworthy, viable, and the future. the carbon energy industry will spend millions on propoganda putting down solar, but one nagging question will keep popping up; “then why did Buffet buy the second largest solar farm in the country?”
this is a huge news for alternative energy, soon to be the preferred energy, I’m real happy to read this. SOLAR EVERYWHERE.
I pointed out to the tea partiers who ride my diesel powered bus on my commute, add up the true cost of a gallon of gas, including ALL the costs: health costs of pollution, armies to secure the middle east, direct tax subsidies, destruction of our natural spaces, contamination of our water table, and the cost to our economy of paying an 800 billion dollar fee to OPEC every fucking year ! The tea partiers, god bless them, actually shut their mouths for once, their brains were working overtime, smoke was streaming out their ears, and a couple of them nodded in agreement. They’re not really bad people, just extremely stupid, you have to spell things out for them.
know there’s a theory out there on the fringe right that Warren Buffett is some kind of communist, but in reality he’s a straight-up capitalist.
LOL. Buffett is a welfare queen who benefitted and was saved by all the bailouts and FED intervention without which he may now be struggling to buy groceries let alone a solar company.
Plus he gave a lot of money to Gates foundation, and today gates announces he is doing a nuke power deal with china, and china is going to help Gates develop VACCINES, GMO seeds etc to HELP developing nations. I used to respect how these guys used their money to help the world. Now I realize it is just a way to avoid taxes and have a few people have tremendous power over the world. I say end the loophole and TAX them
FWIW, big oil man & 1%er T. Boone Pickens has been advocating for developing wind and solar energy for a while.
As with Buffet, I have mixed emotions about Pickens. But just saying: neither Pickens or Buffet is a fool and both, while possibly just as greedy as the next 1%er, aren’t going to do something just bc it’s “good.” They see an investment, while also *realizing* the salient FACT that the world’s Oil reserves are finite, no matter how many people we kill and land/ocean/etc we rape & spoil to get it.
Citizens who want to diss Green technologies as “teh stoopit” are not very forward-thinking, but… well, that’s the story these days in Team USA. Short-term profit is the GOD of all things. Long range thinking is for LIEbrul stupid elites, yadda yadda.
yes, agree with what you say. Anyone who reveres the Buffets and the Gates as great philanthropists need to do more homework.
That said, Buffet wouldn’t be investing in solar energy if he didn’t think it made sense to do so.
Woohoo, another capitalist reaching for the future energy sector of solar or wind.
What could possibly go wrong?
The gov. could do the same in each state, with taxpayer dollars, and then charge a pittance what these capitalists will charge. Jobs, check. Public interest, check. Cheap, renewable, check and check.
Why in the FUCK are these people allowed to charge us this? They always take some of the top. They always nail you with the fees (I remember fondly back in the day when it was nickle and diming, … but now days they just go for the jugular, aka large chunks out of your account).
This doesn’t require innovation or business savvy.
It’s basic cut and paste of what most other countries are doing, ex. Spain, Germany, China, ….
Buffet’s move is a bad thing for us. Some may think it benefits us. It won’t. Now they will have a monopoly on this too.
Heads they win, tails we lose.
“This comes as about 48 gigawatts of coal retirements at 231 plants will have retired from 2010 to 2022″.
I wonder what the effect is of retiring all that coal and replacing it with clean energy. I mean quantifiable reduction in crap spewed into the air. Would it drastically reduce our emissions?
No. As US emissions drop off, China’s emissions increase. China has already eclipsed the US as the world’s CO2 polluter.
No. That figure represents a only a small percentage of total coal plant output. It will help a little, but in 2009 coal provided over 39,000 terawatt-hours of electricity globally.
Thanks, ghost and zapkitty. By “our emissions” I meant the USA, not the world. I assume that’s what the Edison report was referring to.
According to Wikipedia, “In 2009, there were 1436 coal-powered units at the electrical utilities across the US, with the total nominal capacity of 338.732 GW”. So that 48 GW represents about 14% of the nation’s coal power, which is the dirtiest carbon source (until Keystone XL opens shop). Seems like there’s potential for major USA emission reduction IF it’s replaced with clean power.
Hey, one can hope.
Why do you equate this purchase with Solyndra? They are not even in the same business.
Warren Buffett’s brain has been very good to me. It has kept my wife and me out of the (relative) poor house. He probably has the best economic intuition in the United States, and has been for close to a generation. He bets on what he regard to be sure things. Since everybody knew that the Obama regime was going to bail out the banks, his investments there were effectively a sure thing. He does not sit on many corporate boards because he doesn’t think CEO’s are worth what they get paid, and no CEO will appoint him. He was good on underfunded private pensions, which he fingered back in the 90s as a corporate scam (the companies were projecting 9 percent returns on their pension funds to keep their contributions down (and reported profits and bonuses up).
Buffett is a straight shooter. If most capitalists were like him there would be something to say for capitalism. He is not, like Pickens, who is a raider who doesn’t give a fuck about the lives he ruins.
550 megawatts? How about one gigawatt?
The Chinese company ENN Group has launched an effort to build a large solar generating farm accompanied by a valuable thin solar panel manufacturing plant in Nevada. The company ENN chairman put the initial investment in the Laughlin project as $5 billion. “We’re hoping as it develops we will expand our investment,” he said. He said he envisions generating 1 gigawatt of electricity within a decade of opening ENN’s largest American facility at Laughlin. “We are committed to our U.S. businesses,” he stated.
http://www.laughlintimes.com/articles/2011/12/07/news/local/news998.txt
It is crazy to argue that Buffet’s investment means that the economics of photovoltaic power are compelling. The only reason this project is even being built is because the state in its wisdom is mandating that the public utilities purchase “alternative” power at prices that are many times higher than what the utilities pay for nuclear and natural gas. This is simply a case of the electric ratepayers being compelled to subsidize the return on Buffet’s investment. And one thing we know for sure — we cannot regrow our California industrial base if we are compelled to pay prices for electricity that are multiples of what people in other states and countries are forced to pay. The giant sucking sound from industries fleeing the golden state will continue as long as this public policy nonsense continues.
Unfortunately we share the same planet as China (CO2 source), and fortunately we share the same planet as Brazil (CO2 sink). It’s global emissions that are of concern. Air molecules don’t understand international boundaries.