MidAmerican Energy Holdings Company, the energy giant owned by Warren Buffett-controlled Berkshire Hathaway, is leaping into solar power in a big way.
The company has announced a deal to purchase First Solar’s 550-megawatt (MW) Topaz Solar Farm under development in California.
Topaz is the giant solar plant that First Solar was all set to build in San Luis Obispo County with help from a $1.93 billion federal loan guarantee. But late this summer, in the waning days of the U.S. Department of Energy’s Section 1705 program – and with the Solyndra bankruptcy heightening scrutiny – that conditionally approved loan fell through.
MidAmerican didn’t say how much it was paying for the plant, but it called Topaz a "more than $2 billion" project.
Under the deal, First Solar will build, operate and maintain the Topaz plant for MidAmerican, the companies said. Construction began last month on the project, which will use post-mounted 5.5-foot-high thin-film photovoltaic (PV) panels from First Solar, and the plant isn’t expected to be operating until 2015. Pacific Gas & Electric will take the electricty from Topaz under a 25-year power purchase agreement.
MidAmerican Energy says it is "No. 1 in the nation in ownership of wind-powered electric generation among rate-regulated utilities," with “more than 1,393 megawatts of wind generating facilities in operation and under contract in Iowa." (The company has also been criticized in some quarters for allegedly dirty ways.)
On its website, the company also lists geothermal, hydroelectric and biomass as sources of renewable power – but no solar. Until now.
"As energy needs continue to increase, the Topaz project will allow MidAmerican to produce renewable energy for thousands of Californians," Greg Abel, chairman, president and CEO of MidAmerican, said in a statement.
"This project also demonstrates that solar energy is a commercially viable technology without the support of governmental loan guarantees and reflects the type of solar and other renewable generation that MidAmerican will continue to seek to add to its unregulated portfolio."
Announcement provided an immediate boost to First Solar’s stock, as it soared from around $46 to nearly $52 before settling back a bit. In February this year First Solar was trading at as high as $170. The company’s struggles this year led in October to the sudden exit of Chief Executive Rob Gillette, with founder Michael Ahearn taking over as interim CEO.