Warren Buffett jumps into solar

The U.S. solar industry, including First Solar, could use a little financing help for its utility-scale projects. Enter Warren Buffett.
Written by Kirsten Korosec, Contributor

Around this time last year, Warren Buffett's power company MidAmerican Energy Holdings helped lift the wind industry out its catatonic state with plans to build 258 turbines in Iowa. This December, MidAmerican Energy is jumping into large-scale solar power.

First Solar said today that MidAmerican will buy its 550 megawatt Topaz solar photovoltaic farm in California. Financial details were not disclosed in the announcement. The $2 billion Topaz solar farm located in San Luis Obispo County is one of two largest under construction in the world -- both of which are being built by First Solar. When complete it will generate enough electricity to power 160,000 average California homes.

The deal comes at an opportune time for First Solar. The company was unable to lock up a U.S. loan guarantee to help finance its construction. The purchase also marks MidAmerican's increasing interest in alternative energy projects. The company provides electricity and natural gas to customers in Iowa, Illinois, South Dakota and 52 percent of it is generated from coal. About 20 percent comes from wind, hydroelectric and biomass and 21 percent by natural gas and oil. Seven percent is generated from nuclear energy.

As part of the agreement, First Solar will construct, operate and maintain the Topaz project for MidAmerican. Construction began in November 2011 and is expected to be complete by early 2015. The project will create approximately 400 construction jobs and 15 ongoing operations and maintenance jobs.

Pacific Gas and Electric Company will buy the electricity from Topaz under a 25-year power purchase agreement, helping California to meet its mandate to generate 33 percent of its power from renewable sources by 2020.

Photo: First Solar


This post was originally published on Smartplanet.com

Editorial standards