Category Archives: Berkshire Hathaway Energy

BHE Canada to Build Wind Farm in Alberta

(BRK.A), (BRK.B)

Berkshire Hathaway Energy’s BHE Canada subsidiary will build a 117.6MW wind farm in the village of Whitla, southwest of Medicine Hat, Alberta, Canada.

The Rattlesnake Ridge Wind Power Project will consist of 28 – 4.2MW wind turbines generating a combined 117.6MW of electricity. Although a turbine model and layout has been finalized for permitting, the application to the AUC allows the company the flexibility to change the turbine model and layout, pending on-going discussions with turbine manufacturers.

The only current anticipated change would be removing 2 turbine locations and using a turbine with a slightly higher nameplate capacity. The general turbine characteristics would remain unchanged.

The project will t-tap 879L, the 138kV transmission line, owned and operated by Berkshire Hathaway Energy’s AltaLink, which is located within the south end of the Project area.

AltaLink is Alberta’s largest regulated electricity transmission company, and was acquired by Berkshire Hathaway Energy in 2014.

The project will begin construction in the summer of 2020, with a target date for commercial operation of December 2021.

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 Hires Fire Mitigation Specialist

(BRK.A), (BRK.B)

With the massive California wildfires that bankrupted PG&E on everyone’s minds, Berkshire Hathaway’s NV Energy has proactively hired Mark Regan, a former fire marshal with nearly three decades of experience, its first-ever Fire Mitigation Specialist.

Regan will be part of the NV Energy team that implements the natural disaster protection plan required by Senate Bill 329, which includes the Public Safety Outage Management program. Regan will also work with fire departments statewide on efforts to reduce the risk of wildfires.

“Wildfires pose an increasing threat to our state and our customers,” said Kevin Geraghty, NV Energy Senior Vice President of Operations. “Mark’s expertise as a former fire marshal will provide us with important insight into developing and implementing safety programs that will help us reduce fire risk and keep our customers and communities safe.”

Prior to joining NV Energy, Regan spent the last seven years as Fire Marshal and Division Chief for the North Lake Tahoe Fire Protection District, and before that worked in multiple roles for the Sierra Fire Protection District. He has served as incident commander for numerous wildland fire emergencies and has been the lead investigator for multiple wildland fires. He also brings an extensive background in public safety education and outreach, having led 35 evacuation drills, including the largest full-scale drill in the state and the first bi-state evacuation drill with California and served as a public information officer.

“I am excited to be part of this company that makes the safety of the communities it serves a priority,” Regan said. “I look forward to working with the NV Energy team and other stakeholders on the natural disaster protection plan and building partnerships with fire agencies and emergency management teams throughout the state.”

Regan is also the President of the Nevada Chapter of the International Association of Arson Investigators.

© 2019 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 Plans $200 Million Wind Farm in Alberta

(BRK.A), (BRK.B)

Berkshire Hathaway’s BHE Canada will break ground on a new wind farm in southeast Alberta in 2020, and a large Canadian corporate partner has signed a long-term power purchase agreement with BHE Canada for the majority of the energy output from the Rattlesnake Ridge Wind project.

The new 117.6 MW Rattlesnake Ridge Wind project will be located southwest of Medicine Hat and will produce enough energy to supply the equivalent of 79,000 homes.

“The Rattlesnake Ridge Wind project is a leader in the development of new grid-scale wind generation in Alberta, being constructed and operated without government subsidies,” said William Christensen, Vice President Corporate Development of BHE Canada. “BHE Canada is excited to take this first step into the Alberta market, providing low-cost, renewable energy. We’re looking forward to more opportunities to invest in Alberta’s energy industry.”

“Alberta is proud to be home to so many great innovators and entrepreneurs who see the opportunity that exists when people choose to invest and create jobs here. This exciting new energy project will add to Alberta’s impressive renewable energy network, and is a vote of confidence in our economy. Even more encouraging is that this $200 million project does not rely on government subsidies, but instead relies on the potential and opportunity that exists right here in Alberta,” said Alberta Premier Jason Kenney.

Privately financed by BHE Canada through a combination of equity and debt, the more than $200 million project is under development by RES, which will also provide construction and asset management services. RES has extensive experience in building large-scale renewable energy projects around the world, including the 150 MW Halkirk Wind project in east-central Alberta. The project is expected to provide approximately 150 jobs at peak construction during the approximately 18-month schedule.

“RES is delighted to partner with BHE Canada to leverage our expertise and experience to bear in delivering clean renewable power to Alberta,” said Graham Reid, CEO of RES in the Americas.

Once the project is complete, the wind farm will generate electricity from up to 28 wind turbines and is expected to provide approximately 475 GWh per year. Rattlesnake Ridge Wind is expected to begin generating energy for Alberta’s grid in December, 2021.

BHE Canada and RES have also permitted the Forty Mile Wind Farm in the County of 40 Mile in southeastern Alberta and are looking for partners in long-term power purchase agreements. This project will have a generation capacity of 398.5 MW, potentially making it the largest wind power project in Canada, and is located on approximately 40,000 acres of privately-owned land, roughly five kilometres east of the town of Bow Island.

BHE Canada was established in 2015 after Berkshire Hathaway Energy (BHE) made its foray into the Canadian market with the purchase of AltaLink, Alberta’s largest independent transmission provider.

BHE Canada is focused on business opportunities within all aspects of the energy infrastructure market across Canada, including electricity transmission and distribution, and oil and natural gas infrastructure. With a particular focus on renewable energy, BHE Canada will invest in power generation sources including wind, solar and natural gas.

BHE Canada also owns a 20 MW natural gas fired, reciprocating engine driven generating facility northwest of Medicine Hat in southern Alberta. The facility went into commercial operation in December 2016.

© 2019 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 Energy Addresses Proposed PURPA Rulemaking

(BRK.A), (BRK.B)

The Federal Energy Regulatory Commission last week voted to issue a notice of proposed rulemaking to revisit its rules and regulations implementing the Public Utility Regulatory Policies Act of 1978. In a release, Berkshire Hathaway Energy has stated that it supports the proposed rulemaking to modernize PURPA, as policy revisions will allow the company to provide additional value to its customers.

“We appreciate Chairman Chatterjee’s leadership and the thoughtful efforts of FERC and its staff in issuing this proposal,” said Pat Reiten, Berkshire Hathaway Energy senior vice president of government relations. “We look forward to reviewing the proposed rule and working with FERC and our state commissions to provide cost-effective, renewable resources to our customers.”

Berkshire Hathaway Energy notes that since PURPA was enacted, the energy industry has drastically changed, and PURPA’s regulations have led to unintended consequences resulting in above-market prices for certain energy contracts. As Berkshire Hathaway Energy acquires increasing amounts of renewable generation, the proposed reforms will provide greater opportunities to ensure customers receive the best energy prices.

© 2019 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.

US Solar Fund Acquires Milford Solar Project That Will Supply PacifiCorp

(BRK.A), (BRK.B)

US Solar Fund plc has closed the acquisition and financing of 100% of the cash equity interests in the 128MWDC Milford Solar Project.

Construction is expected to begin immediately with full commercial operations expected before the end of 2020.

The Company first announced the acquisition on 23 July 2019, however detailed disclosure was subject to financial close.

The Project is in Beaver County, approximately six miles north of Milford, Utah. Milford is expected to be operational in late 2020 and, will sell 100% of the power and renewable energy credits generated at a fixed price for 25 years to PacifiCorp, a wholly owned subsidiary of Berkshire Hathaway Energy.

PacifiCorp has contracted to sell all the renewable attributes associated with the Project to a retail customer.

PacifiCorp is a US electric power company that primarily operates regulated utilities with a service territory across the US states of Oregon, Washington, California, Utah, Idaho and Wyoming.

USF will acquire Milford from developer Longroad Energy Partners, LLC. The Longroad team has a track record of developing and financing more than 5GW of utility-scale renewable energy projects since 2004, including over 1GW in the state of Utah.

The Project will be constructed on a fixed-time and fixed-cost basis by McCarthy Building Companies, one of the largest construction companies in the US with over 2.8GW of solar and energy storage projects designed, constructed or completed since 2013.

The Project will use First Solar Inc.’s high-performance Series 6 solar panels and First Solar Energy Services is expected to provide operations and maintenance services under a separate long-term contract.

Once operational, the Project will generate over 277,500 megawatt hours of electricity annually. This volume of electricity is equivalent to displacing approximately 235,000 tonnes of CO2 emissions, powering 31,000 homes, or removing 51,000 cars from the road, every year.

© 2019 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.

Index AR Solutions & Berkshire Hathaway’s MidAmerican Energy Partner on Mobile App to Simplify Source-Transfer Switch Operations for Electrical Utilities

(BRK.A), (BRK.B)

Index AR Solutions has partnered with Berkshire Hathaway’s MidAmerican Energy Company on an augmented reality (AR)-enabled mobile application that helps workers complete source-transfer controller operation, troubleshooting and start-up tasks with greater safety, speed and confidence. By enabling workers to visualize important steps and decision points, the newly available Source-Transfer Controller SuperApp® ensures that procedures are completed fully and quickly – ultimately minimizing service delays to electrical customers and reducing the risk of utility infrastructure damage.

MidAmerican Energy Company is a subsidiary of Berkshire Hathaway Energy, wholly-owned by Berkshire Hathaway that serves some 770,000 electric customers and 751,000 natural gas customers in Iowa, Illinois, Nebraska and South Dakota.

The Source-Transfer Controller SuperApp® is the second application development partnership between Index and MidAmerican. The two companies are also deploying a combined augmented reality (AR) and eBook training application for MidAmerican gas apprentice students that boosts engagement, knowledge retention and worker safety.

“We’re delighted to have once again partnered with a true leader in innovation such as MidAmerican Energy, as we reimagine the utility workplace of the future,” said Dan Arczynski, CEO at Index AR Solutions. “Blending advanced visualization techniques with industry best practices and the knowledge of a utility’s most skilled workers, the Source-Transfer Controller SuperApp® helps workers perform intricate procedures as safely and as efficiently as possible, each and every time.”

Source-transfer controllers are sophisticated switching mechanisms used by MidAmerican and other electrical utilities to minimize power interruptions, enabling operators to quickly shift from one power source to another in the event of a problem. The devices are complex, with multiple decision trees that often require a 4-6 hour schedule for an engineer to initially set up or reset. In addition, missed or incorrect steps can result in equipment damage, injury or service delays.

By helping workers visualize specific setup steps, the Source-Transfer Controller SuperApp® uses AR to address a common challenge in the electric utility industry. The app presents workers with an agreed-upon set of best practices, decision trees, and safety warnings at the exact time and place they are needed within a procedure.

The app gives a qualified electrician the confidence to safely perform troubleshooting, start-up and operational tasks with minimal errors or risk, ultimately translating into fewer service interruptions to customers and fewer incidents of costly equipment damage.

The Source-Transfer Controller SuperApp® is the latest in a series of more than 40 AR and eBook product offerings from Index called SuperApps® that are tailored to address common challenges associated with an industry. Delivering the core functionality of Index’s custom-built applications, SuperApp® product development is performed in the field – in close collaboration with an initial client partner – using real-world scenarios.

The Source-Transfer Controller SuperApp® is available for purchase through Index AR Solutions, with pricing and terms based on a co-marketing agreement with MidAmerican Energy Company.

© 2019 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 Assumes Sole Ownership of Foote Creek I Wind Farm

BRK.A), (BRK.B)

PacifiCorp, a subsidiary of Berkshire Hathaway Energy, has acquired sole ownership of the Foote Creek I wind facility, a 41.4 MW project in Carbon County, Wyoming.

PacifiCorp is now proceeding to repower the project with new turbine technology, increasing energy output by 60%.

The repowered facility will produce enough energy to meet the needs of 19,500 typical homes in PacifiCorp’s service territory. It is anticipated that the project will generate an additional $14 million in tax revenue for rural Wyoming communities over the next 30 years.

Foote Creek I was the company’s first wind facility and the first utility-scale wind project in Wyoming. The demonstration project was commissioned in 1999, with PacifiCorp and the Eugene Water & Electric Board as co-owners, and it was supported with a power purchase agreement with the Bonneville Power Administration.

“Twenty-one years ago, PacifiCorp and its partners’ development of Foote Creek I helped pave the way for utility-scale wind energy as an industry-defining demonstration project,” says Stefan Bird, president and CEO of Pacific Power, a division of PacifiCorp. “Today, this new investment in the project builds on our vision to even better harness wind energy and power the grid with increased efficiency, delivering even more low-cost renewable energy to our customers.”

PacifiCorp will remove the 68 existing 600 kW wind turbine generators originally installed between 1998 and 1999 and replace them with 13 modern turbines, supported by new foundations, energy collector circuits, switchgear and controls.

Notably, repowering in 2020 will requalify the facility for federal production tax credits, which will be passed on as savings to PacifiCorp customers. It will also reduce ongoing operating costs associated with the older turbine equipment.

The repowering is expected to extend the useful life of the facility by more than two decades, creating substantial ongoing benefits for customers. The wind turbines occupy about 1% of the land they are housed upon, thereby allowing the property to continue supporting traditional land uses, such as grazing livestock.

“Acquiring full ownership and repowering Foote Creek I provides a unique opportunity to upgrade the company’s oldest wind plant, located in one of the most favorable wind energy sites in Wyoming, applying the latest technology so that it can continue to serve our customers well into the future,” comments Gary Hoogeveen, president and CEO of Rocky Mountain Power, another division of PacifiCorp.

© 2019 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 $19.77 Million in Q2 Thanks to EIM

(BRK.A), (BRK.B)

Two of Berkshire Hathaway’s utilities, PacifiCorp and NV Energy, saved a combined $19.77 million in the second quarter through the western Energy Imbalance Market (EIM).

The California Independent System Operator (ISO) has released its western Energy Imbalance Market (EIM) 2019 second quarter benefits report that shows total savings have reached $736.26 million since the market’s launch in November 2014.

The benefits for the second quarter reached $86 million for the nine participating members, and the gross benefits for Berkshire’s NV Energy was $4.62 million and PacifiCorp was $15.15 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.

The benefits report estimates the Western EIM reduced CO2 levels by 56,897 metric tons by using surplus renewable energy that otherwise would have been curtailed. Since 2015, the effective use of carbon-free generation from the market has resulted in a gross reduction of 403,546 metric tons of CO2, which is the equivalent of removing the emissions of 84,844 passenger cars driven for one year.

Looking forward, the market continues to grow with benefits anticipated to increase as other participants enter the market. Those future participants include Arizona’s Salt River Project and Seattle City Light in April 2020. Los Angeles Department of Water and Power, NorthWestern Energy, Turlock Irrigation District, and the Public Service Company of New Mexico are slated to begin participation in 2021. Tucson Electric Power in Arizona and Avista, which serves parts of Washington, Oregon, and Idaho, announced plans to participate in 2022.

© 2019 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.of future results.

Berkshire Hathaway’s CalEnergy Resources Buys Into IOG’s Southern North Sea assets

(BRK.A), (BRK.B)

Berkshire Hathaway’s CalEnergy Resources Limited (“CER”) has signed a deal with Independent Oil and Gas plc (“IOG”) for a farm out of 50 percent of IOG’s Southern North Sea assets.

Highlights
• IOG has signed binding definitive agreements with CER to farm out 50 per cent of its Southern North Sea assets, comprising all of the Company’s upstream assets (except for the Harvey licences), as well as the Thames Pipeline and associated Thames Reception Facilities (the “Farm-out”).
• The consideration payable by CER comprises:
o £40 million initial cash payment
o up to £125 million by way of a development carry representing 80 per cent of the costs associated with IOG’s retained 50 per cent interest, comprising:
• up to £60 million of development costs for Phase 1
• up to £65 million of development costs for Phase 2
o £0.50/MCF royalty on CER’s interest in Goddard production above 70 BCF gross up to a cap of £9.75 million.
• CER will receive a royalty of 20.2 percent of IOG’s Phase 1 revenues up to a cap of £91 million.
• CER will have the option, within three months of the Harvey appraisal well completion, to farm in to 50 per cent of the Harvey licences in consideration for:
o £20 million additional cash payment
o an uncapped royalty of £0.95/MCF on CER’s net Harvey gas production (equivalent to £61.3 million if Harvey produces IOG’s 129 BCF Best Estimate Prospective Resources).
• IOG and CER have also signed an Area of Mutual Interest (“AMI”) agreement to pursue further business development opportunities in the scope of the Thames Pipeline on a 50:50 basis.
• IOG is planning to issue a Euro-denominated Senior Secured Bond (“Bond”) of approximately £70 million to fund its share of Phase 1 costs. There is no additional external funding requirement expected for Phase 2.
• Upon Farm-out and Bond completion, IOG and CER will submit notice of Core Project Phase 1 Final Investment Decision (“FID”) to the Oil and Gas Authority (“OGA”).
• IOG has also entered into agreements to repay and restructure its existing financing arrangements with London Oil and Gas (“LOG”)
• IOG will retain Operatorship of the Core Project.

The Core Project comprises 410 BCF, of 2P+2C reserves and resources across six discovered Southern North Sea (SNS) gas fields. IOG will pay CER a royalty of 20.2% of its net revenues from the Phase 1 fields only (i.e. 10.1 per cent of gross Phase 1 revenues, net of National Transmission System entry charges and applicable marketing fees), up to a cap of £91 million over field life.

In addition, IOG will receive an effective royalty interest equating to £0.50/MCF on CER’s 50 percent share of production from certain sections of the Goddard Field after 70 BCF gross has been produced from the field up to a maximum royalty of £9.75 million.

© 2019 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

Vestas secures 459 MW order from Berkshire’s PacifiCorp

(BRK.A), (BRK.B)

Vestas has received an order for 459 MW of V136-4.2 MW turbines operating in 4.3 MW power optimised mode from PacifiCorp, a subsidiary of Berkshire Hathaway Energy, for two wind projects, TB Flats I and II, located in Wyoming. Including previously purchased V110-2.0 MW turbines, the projects will have a combined capacity of 503 MW.

TB Flats I and II are part of PacifiCorp’s Energy Vision 2020 initiative, a USD 3.1 billion investment to expand wind power via repowering existing projects, adding 1,150 MW of new wind resources by the end of 2020, and building a 140-mile transmission line segment in Wyoming to enable wind generation.

As part of Energy Vision 2020, Vestas and PacifiCorp previously partnered on repowering the Marengo and Marengo II wind projects in Washington, upgrading the site’s existing V80-1.8 MW turbines with V100-2.0 MW turbines.

“We’re pleased PacifiCorp has selected our V136-4.2 MW, operating in 4.3 MW power optimised mode for the TB Flats I and II projects,” said Chris Brown, President of Vestas’ sales and service division in the United States and Canada. “With their Energy Vision 2020 initiative and commitment to expanding wind energy, PacifiCorp brings both the environmental and economic benefits of low-cost, competitive, and clean wind energy to their customers and communities.”

The order includes supply and commissioning of the turbines as well as a 12-year AOM 4000 service agreement, designed to ensure optimized performance of the project. Turbine delivery will begin in the second quarter of 2020, with commissioning scheduled for the fourth quarter of 2020.

© 2019 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.