Category Archives: Berkshire Hathaway Energy

NV Energy to Get into EV Charging Station Business

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Nevada, a state with lots of wide-open spaces, is looking to reduce range anxiety for electric vehicle owners.

Nevada’s Public Utility Commission has given the go ahead to NV Energy to own and operate EV charging stations.

The move is part of Nevada’s Strategic Planning Framework, which has the objective of completing an “electric highway” system serving the entire state by 2020.

NV Energy will commit $15 million to develop the charging stations.

The Nevada Governor’s Office of Energy (GOE), Nevada Department of Transportation (NDO) and Nevada’s electric utilities are expanding the state’s charging infrastructure to support EV deployment by internally connecting the state’s urban centers and providing corridor connectivity to the surrounding region.

Phase I will build charging stations on U.S. Highway 95. This first phase connects Reno and Las Vegas and eliminates range anxiety for EV owners while also bringing business to local communities.

The first two operational charging stations on U.S. 95 are located in Valley Electric Association’s service territory, at Eddie World in Beatty and in NV Energy’s service territory, at Fox Peak Gas Station in Fallon.

Charging stations are currently under development with NDOT in Hawthorne and Tonopah.

Phase II will include U.S. Interstate 15, U.S. Interstate 80, U.S. Highway 93, and U.S. Highway 50.

Electric Vehicle Charging Stations are placed at cost-effective and strategic locations along the Nevada’s major transportation corridors.

Each station is comprised of a minimum of one Direct Current Fast Charger and two Level 2 Chargers. Direct Current (DC) Fast Chargers can charge a vehicle in less than an hour; Level 2 chargers typically require several hours for a full charge.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

PacifiCorp Looks to Wind to Power Expanded Capacity

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PacifiCorp is looking to wind power and solar to meet future power needs, and will not be adding any new natural gas resources through the 20-year planning horizon.

This is the first time an Integrated Resource Plan has not included new fossil-fueled generation as a least-cost, least-risk resource for PacifiCorp.

The plan provides a framework for future actions that PacifiCorp will take to provide reliable and reasonably priced service for its customers through the least-cost, least-risk resource portfolio.

The plan includes 1,311 MW of new wind power, repowering just over 999 MW of existing wind capacity, and the new 140-mile, 500 kilovolt (kV) Aeolus-to-Bridger/Anticline transmission line in Wyoming.

Collectively, these resources contribute to meeting the capacity need identified in PacifiCorp’s updated load-and-resource balance and are on track to be in service by the end of 2020.

Through the end of 2036, the updated preferred portfolio includes over 2,700 MW of new wind resources, 1,860 MW of new solar resources, 1,877 MW of incremental energy efficiency resources, and approximately 268 MW of direct-load control resources.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Hathaway’s Utilities Saved $14.68 Million in Q1 2018 Thanks to EIM

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Two of Berkshire Hathaway’s utilities, PacifiCorp and NV Energy, saved a combined $14.68 million so far this year through the western Energy Imbalance Market (EIM).

The California Independent System Operator (ISO) has released its western Energy Imbalance Market (EIM) 2018 first-quarter benefits report that shows total savings have reached $330.52 million since the market’s launch in November 2014.

The benefits for January, February and March 2018 were $42.08 million for the six participating members, and the gross benefits for Berkshire’s NV Energy was $4.17 million and PacifiCorp was $10.51 million.

The western EIM platform automatically finds and delivers low-cost energy to serve consumers in Arizona, California, Idaho, Nevada, Oregon, Utah, Washington and Wyoming. Optimizing diverse resources from a large geographic area enables more effective use of carbon-free generation besides reducing costs.

In 2014, Berkshire Hathaway Energy’s PacifiCorp agreed to become the first participant in the Energy Imbalance Market, and NV Energy joined in December 2015.

The market will continue to grow in the coming years, with the Balancing Authority of Northern California/Sacramento Municipal Utility District set to begin participating in April 2019. Salt River Project of Phoenix, Seattle City Light and the Los Angeles Department of Water and Power are slated to enter the market in April 2020.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Wind Powers Berkshire into Top Spot

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With 6.751GW of wind power owned or under contract, Berkshire Hahtaway Energy has moved into the top spot for utilities generating power through wind farms.

According to the American Wind Energy Association (AWEA), Berkshire passed Xcel Energy in 2017 to gain the top spot.

Berkshire’s MidAmerican Energy has set a goal of getting 100% of its energy generation from renewable sources, primarily wind power.

Other Berkshire utilities have also set ambitious goals.

PacifiCorp recently selected four new wind projects that will expand the amount of wind energy produced by 2020.

PacifiCorp’s owned and contracted wind power will increase by more than 60% and will.add enough wind power for approximately 450,000 average homes.

PacifiCorp’s new wind development is part of the company’s Energy Vision 2020 initiative, which also will upgrade the company’s existing owned wind fleet in Wyoming, Washington and Oregon with longer blades and newer technology, and build a new high-voltage transmission line in Wyoming to connect the new wind energy to PacifiCorp’s grid.

“We are committed to expanding the amount of renewable energy serving our customers, and these new wind projects will help us cost-effectively further that goal,” said Stefan Bird, President and CEO of Pacific Power, the unit of PacifiCorp that serves customers in Oregon, Washington, and California.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

NV Energy Exceeds Nevada’s Renewable Energy Requirement for 8th Straight Year

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Berkshire’s Hathaway’s NV Energy achieved a 25.5 percent renewable energy and related credits level in northern Nevada and 23.1 percent in southern Nevada, for a combined weighted average of 23.8 percent.

This is the eighth year in a row that NV Energy has exceeded the state’s renewable energy requirement, which currently sits at a 20 percent level.

Separate from this legislated mandate, NV Energy has set a goal to double its renewable energy portfolio by 2023.

The most recent additions to NV Energy’s renewable energy portfolio included the 50-megawatt Boulder Solar 2 project in Eldorado Valley southeast of Las Vegas and the 179-megawatt Switch Station 1 and 2 project located in the Dry Lake Solar Energy Zone north of Las Vegas.

NV Energy’s Senior Vice President of Renewable Resources Dave Ulozas noted that NV Energy has been providing renewable energy to customers since the 1980s, and the most recent renewable energy rankings by the U.S. Energy Information Administration puts Nevada second in the nation for geothermal resources and fourth for solar energy.

“We are proud to continue to help expand Nevada’s growth in clean energy, which benefits both our customers and Nevada’s strengthening economy,” Ulozas said. “We’ve been able to accomplish this while keeping electricity rates about 15 percent lower than they were nearly a decade ago, and we anticipate adding a considerable amount of new renewable energy at similar or lower rates than we have in place today.”

Currently NV Energy customers benefit from 46 separate renewable energy projects in Nevada, which include 19 geothermal plants, 16 solar fields, six hydroelectric resources, four biomass or methane gas facilities and one large wind farm.

Five additional large solar fields are being constructed or developed for NV Energy customers, which are located in both northern and southern Nevada areas.

Additionally, the company and an independent evaluator are reviewing more than 100 bids for renewable energy projects and battery-energy storage systems proposed for 26 separate sites throughout Nevada. The winning bids will be submitted for approval to the PUCN by June 1, 2018.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Special Report: Opportunities Abound for Berkshire in the Growing EV Market

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Everyone can see it coming, petrol, gas, diesel, whatever you want to call it, will play a diminishing role in fueling cars of the future. It’s already playing a diminishing role right now.

Let’s look at a few numbers.

In 2016, 750,000 EV cars were sold worldwide, with Norway the highest in market share at 29%, and China the largest in total units sold. And, 2016 marked the first time that EVs passed more than 2 million vehicles on the road worldwide.

While those numbers are still tiny when compared to the 2 billion vehicles in service around the world, they confirm that the EV is not only here to stay, but will play an ever larger role in personal and commercial transportation.

Credit Tesla with making the EV fashionable in the U.S., and drawing in other car makers that are now debuting their own models. In fact, Tesla has made the EV so fashionable among high-end buyers that in Europe Tesla’s Model S outsold both the traditional petrol-fueled BMW 7 series and Mercedes-Benz S class.

It’s easy to go down the list of carmakers that are showing off their EV vehicles at this year’s auto shows. Volkswagen, which was committed to diesel cars before its huge emissions scandal, is now touting its EV retro-styled concept bus, the I.D. Buzz. And Jaguar’s heading to market in late-2018 with its I-Pace SUV.

BMW, Hyundai, Nissan, Porsche, Toyota, and Volvo, to name a few, are all announcing new EV models or EV versions of existing models. Even Bentley has an all-electric four-door coupe in the works for 2019, and a goal to have an electric version of each of its models by 2025.

For drivers in China that purchased 600,000 EVs in 2017 at the lower-end of the market, it’s China’s BYD that led the way, with Chery, SAIC Wuling, Hawtai, and BAIC all moving more than 3,000 units in December 2017 alone.

The new energy company BYD, which Berkshire Hathaway has a roughly $1.9 billion stake in, sold almost 14,000 ev cars in February 2018, and is the global sales leader despite not being in the U.S. market except for its pure-electric buses.

Back in the U.S., Tesla’s Model 3 is aimed at bringing the company’s cars to a whole new set of consumers, and it’s not the only one making inroads at making an EV with true extended driving range affordable.

GM’s more mainstream price point Chevy Bolt, which boasts a 238-mile range, is now heading towards the company’s goal of moving 30,000 units a year.

All this EV progress bring up the question of what’s Berkshire Hathaway’s role in it?

It’s likely not as a manufacturer.

Berkshire’s roughly 8 percent stake in BYD, and its stake in GM, which was actually down 10 million shares (-16.7%) as of its most recent 13-F filing, doesn’t indicate Warren Buffett wants to be anything but a passive investor in making cars.

Berkshire will certainly play a role in new and used EV sales, as its Berkshire Hathaway Automotive Group of 78 independently operated dealerships with over 100 franchises in 10 states, gives the company a slice of that market.

However, fueling EVs is also right up Berkshire’s alley.

Not the Cars, the Fuel

Berkshire’s in a number of interesting spaces when it comes to fueling EVs. As the EV market-share grows, so do the number of consumers that will be charging their vehicles at home.

When it comes to home charging, its utilities, including PacifiCorp, MidAmerican Energy and NV Energy generate and supply power in twelve states. And overseas, Berkshire’s Northern Powergrid delivers electricity to 3.9 million homes and businesses in England.

Berkshire also is a big player in the electricity transmission business. Its BHE U.S. Transmission owns over a thousand miles of transmission lines in the southern U.S. and California. In Canada, Berkshire’s AltaLink is the largest regulated transmission company in Alberta, supplying electricity to more than 85% of the population.

Taking the EV on the Road

Even though much of the EV market will be charging its cars overnight at home, there is still a big need to be able to quickly charge your vehicle while traveling.

Out of necessity, Tesla has made a substantial investment in this space, to-date building 1,191 Supercharger Stations with 9,184 Superchargers.

These superchargers already benefit Berkshire in areas that get their power from Berkshire-owned utilities.

And a recent Berkshire acquisition has the potential to greatly boost their own capability in this space.

The New King of the Travel Center

In October 2017, Berkshire took a 38.6 percent equity stake in Pilot Flying J, the largest operator of travel centers in North America. That stake will grow in 2023 when Berkshire will become the majority shareholder by acquiring an additional 41.4 percent equity.

With 750 locations across the U.S. and Canada, and more than $20 billion in revenues, Pilot Flying J already plays a substantial role in fueling cars and commercial trucks. It’s also a natural fit for EV charging stations. And while EV ranges continue to grow, the need to charge your vehicle away from home is also growing.

That’s Not All

The charging station space is so new that there are likely to be multiple opportunities for Berkshire, as the lack of a need for storage tanks, which kept traditional petrol fueling stations centralized, means that charging stations can fit into public parking lots, mall and office building parking, and other spaces that were inconceivable for a gas station.

For example, in Oregon, PacifiCorp just received the greenlight to build seven charging stations as part of a $4.64 million transportation electrification plan.

PacifiCorp plans to install seven “pods” that would include multiple dual-standard direct current fast chargers, which can provide up to 80 miles of driving range in 20 minutes of charging, and at least one level 2 port, which offers up to 20 miles of range in an hour of charging.

Whether utilities will ultimately be allowed to own large networks of charging stations remains to be seen, as some environmental groups and potential competitors in the space are already objecting to that concept.

However, the future looks bright for Berkshire. It’s got the electric power, it’s got the transmission, and it’s even got the car dealerships and travel centers that clearly will make it a player in the growing EV market.

For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Rocky Mountain Power to Construct Four New Wind Farms

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Berkshire Hathaway’s Rocky Mountain Power has chosen four new wind projects to fulfill its planned expansion of the amount of wind energy serving customers by 2020.

The four projects will expand Rocky Mountain Power’s owned and contracted wind power by more than 60%, and add enough new wind energy to power approximately 450,000 average homes.

The bids were selected following a request for proposal (RFP) issued in September 2017. The RFP establishes a competitive bidding process for the company to select the most cost-effective new wind projects.

The four selected projects are:

  • A 400-MW wind project in Converse County, Wyoming, which will be built by NextEra Energy Resources, LLC, with half of the project owned by PacifiCorp, and half of the project owned and delivered by NextEra under a Power Purchase Agreement.
  • A 161-MW wind project in Uinta County, Wyoming, which will be built by Invenergy, LLC, and owned and operated by PacifiCorp.
  • A 500-MW wind project in Carbon and Albany Counties, Wyoming, which will be built, owned and operated by PacifiCorp.
  • A 250-MW wind project in Carbon County, Wyoming, which will be built, owned and operated by PacifiCorp.

“The new wind projects are part of the company’s Energy Vision 2020 initiative, which will significantly expand the company’s Wyoming wind fleet and benefit the state and local economies,” said Cindy A. Crane, Rocky Mountain Power President and CEO. “The project also includes a 140-mile segment of the Gateway West high-voltage transmission line in Wyoming to connect the new wind energy to Rocky Mountain Power’s grid.”

The cost of the four new wind projects is estimated at approximately $1.5 billion, which is significantly less on a per-megawatt basis than when the new wind and transmission plan was first announced last April. The per-megawatt reduction in project costs helps make the Energy Vision 2020 initiative lower cost compared to other resource alternatives, such as energy market purchases, to meet forecasted customer energy needs.

The projects are also expected to:

  • Create between 1,100 and 1,600 construction jobs in Wyoming and more than 200 full-time positions;
  • Add approximately $120 million in tax revenue from construction; and
  • Bring significant post-construction annual tax revenues starting at approximately $11 million in 2021 and growing to $14 million annually by 2024.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Commentary: Berkshire Gives Up on Enormous Australian Gas Field

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The defining characteristic of any mirage is that the closer you think you are to it, the further away it seems to get.

Sadly, in what is sure to be a major disappointment for Berkshire Hathaway, after years of work its CalEnergy subsidiary is planning to decommission two exploration wells which have been used to test the potential for natural gas production in the Whicher Range, south of Busselton.

The gas field had been estimated to contain four trillion cubic feet of gas-in-place.

The problem has always been how to get it.

CalEnergy is the sole titleholder and operator of the exploration permit EP 408 located approximately 280 kilometers south of Perth, and covers both the Whicher Range and Wonnerup gas fields.

The test wells, WR1 and WR4, will be sealed with concrete and the well heads removed.

The land immediately around the well locations will be rehabilitated in line with conditions to be set out by the Department of Mines, Industry Regulation and Safety.

In 2016, Peter Youngs, the Managing Director of CalEnergy Resources Group, discussed with MazorsEdge the progress on the development of the gas field, noting that “the field represents a large in place gas resource, its characteristics are challenging and there is much work still remaining to move this resource to a commercially developable status.”

Unfortunately, those obstacles proved to be too much to surmount.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire in Top Three in Wind Energy Production

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Xcel Energy, Berkshire Hathaway Energy and Alliant Energy are the top three US utilities with “wind capacity currently under construction or in advanced development,” according to the American Wind Energy Association.

Wind is playing an ever-increasing role in the US energy market.

Some 7,017 MW of new wind capacity was added in 2017, which boosted the US’s total to 89,077 MW.

Wind power has passed hydroelectric as the number one renewable energy source.

Wind energy generation is also a growing employer nationwide. At the end of 2016, the US topped 100,000 Americans employed in the wind energy industry.

According to the according to the American Wind Energy Association, “wind energy delivered over 30% of the electricity produced in Iowa and South Dakota in 2016. Kansas, Oklahoma, and North Dakota generated over 20% of their electricity from wind, while 20 states now produce more than 5% of their electricity from wind energy.”

Berkshire Hathaway is also playing a key role in the financing of wind-power projects. The recently announced 300-MW Tahoka Wind project, which will be constructed in Lynn County, Texas, has long-term tax equity from BHE Renewables, LLC, a Berkshire Hathaway Energy Company.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Utilities Have $13+ Million in Benefits from Western Energy Imbalance Market in 4th Qtr 2017

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The California Independent System Operator (ISO) has released its western Energy Imbalance Market (EIM) 2017 fourth quarter benefits report that shows the real-time energy imbalance market produced $33.46 million benefits for its six participating members.

During the fourth quarter of 2017 two Berkshire Hathaway Energy companies had over $13 million in benefits. PacifiCorp realized benefits of $6.83 million and NV Energy saved $6.45 million.

The total benefits since the western regional market was launched in 2014 now total $288.44 million for all six members.

Western EIM participants helped reduce carbon emissions in the region by 7,730 metric tons by using 18,060 megawatt-hours of excess renewable energy that otherwise would have been turned off; this translates into removing 1,655 passenger cars from the highways for a year.

“The ISO’s western EIM continues its positive uptick in benefits, accruing savings as it promotes a greener and more reliable energy grid,” said ISO President and CEO Steve Berberich. “We are very pleased with the results for all participants in this growing market.”

The EIM’s state-of-art technology automatically finds and delivers low-cost energy to serve consumers in California, Arizona, Oregon, Washington, Utah, Idaho, Wyoming and Nevada.

In addition to leveraging the diverse resources from a larger pool, the effective use of carbon-free generation provides added environmental benefits. Besides using low-cost energy, EIM utilities reduce their costs by being able to join together to decrease the amount of energy reserves that individual utilities must carry in real time to manage load.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.