Monthly Archives: November 2020

BHE Canada Signs Contract With Siemens Gamesa Renewable Energy to Provide 26 Wind Turbines for Rattlesnake Ridge Wind Power Project

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BHE Canada has signed a contract with Siemens Gamesa Renewable Energy to provide 26 5.0 megawatt wind turbines for the proposed Rattlesnake Ridge Wind Power Project in southeast Alberta.

“Siemens Gamesa has extensive experience in Canada’s renewable energy industry, and this project takes the company’s total fleet to 3.5 gigawatts of installed energy capacity in the country,” said William Christensen, Vice President Corporate Development of BHE Canada.

The wind project and the associated transmission connection was approved by the Alberta Utilities Commission (AUC) on September 9, 2020. On November 16, 2020, BHE Canada filed for an amendment with the AUC to incorporate the use of the SGRE turbines.

The Rattlesnake Ridge Wind Power Project is being privately financed by BHE Canada through a combination of equity and debt and requires no government subsidies or tax incentives to support its operation.

The project is expected to provide approximately 150 jobs at peak construction during the approximately 18-month schedule. Construction activities are ongoing, with almost $12 million already invested in local Alberta contractors and suppliers. Total investment in the County of Forty Mile is expected to be approximately $56 million.

In addition to energy, the project will bring local landowner royalties boosting rural incomes and re-invested by landowners in their farms and their communities. There will be substantial increased tax revenue to the County, potentially reducing the tax assessment across the entire County. Preliminary estimates for tax revenue are in the $1 million to $2 million range per year.

BHE Canada has signed a long-term power purchase agreement with a large Canadian corporate partner for approximately two-thirds of the energy output from the Rattlesnake Ridge Wind project. BHE Canada continues to negotiate with potential partners for the remaining one-third. The more than $200 million project is scheduled to be in service in early 2022.

© 2020 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.

Lessons From Warren Buffett: Don’t Let This Error Take You Out of the Game

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Warren Buffett is fond of baseball analogies. He’s often spoken about an investor being like a baseball batter waiting for the right pitch. He notes that the advantage the investor has over the batter is that there are no called strikes. You can wait for just the right pitch before swinging your bat.

It is a straightforward concept, and speaks to the patience and discipline that good investors should have.

However there is a flipside to waiting for a great deal, and it is an error that Buffett warned about at the 2011 Berkshire Hathaway Annual Meeting. The flipside is thinking that every investment you make, every stock that you buy, has to be an absolute home run.

“One of the things, one of the errors people make in business, and sometimes it can be a huge error, is that they try and measure every deal against the best deal they’ve ever made,” Buffet said. “So they say, you know, I made this wonderful deal for, maybe, an insurance policy written, or it might be a company bought, it might be a stock bought, and they’re determined that they’re never going to make a deal that isn’t that attractive in the future. So, they in effect, sometimes take themselves out of the game.”

For Buffett, it is all about the opportunities that are available to the investor at a particular time.

As Buffett noted, opportunity costs are different for every investment.

“The goal is not to make a better deal than you’ve ever made before. The goal is to make a satisfactory deal that’s the best deal you can make at the time,” Buffett explained.

So, don’t let the search for the perfect investment be the enemy of the good investment.

See Buffett’s full explanation of opportunity costs as it related to five different Berkshire Hathaway investments.

© 2020 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.

BYD to Supply 75 MW Battery Storage for Mustang Solar Plant

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Berkshire Hathaway-backed Chinese battery and vehicle manufacturer BYD Co., Ltd. is partnering with Canadian Solar Inc. to provide advanced battery technology for the 100 MWac Mustang solar plant in Kings County, California.

Located in California’s Central Valley, the Mustang solar power project produces enough clean electricity to power approximately 45,000 homes. Sonoma Clean Power and MCE are purchasing this electricity under long-term power purchase agreements.

The 75 MW or 4-hour 300 MWh energy storage system is a retrofit addition to the Mustang solar plant which was originally developed by Canadian Solar’s wholly-owned subsidiary Recurrent Energy.

For the Mustang project, BYD will utilize Cube Pro, the latest generation energy storage solution designed for larger utility-scale projects. At 2.5 MWh per unit, the Cube Pro has a new liquid-cool battery system in the enclosure, with an energy density increase of 80% compared to the previous generation that used customized shipping containers as the enclosure.

“We are excited to partner with Canadian Solar on this solution. We are very proud to be able to provide reliable and safe BYD technology to the Mustang project,” said BYD North America President Stella Li. “We will deliver the lithium-ion battery storage solution to Canadian Solar, who acts as the full system integrator of the storage retrofit.”

Mustang Solar Project Overview from Recurrent Energy on Vimeo.

By pairing solar PV with advanced battery technology, Canadian Solar helps its customers to generate and store solar power during the day for use in the evening. This approach allows California’s power grid to absorb and integrate higher levels of reliable, safe, and affordable renewable energy while contributing to the state’s climate mitigation efforts.

“We are pleased to start supplying this large-scale solar plus energy storage project which will be fully developed and integrated by Canadian Solar with our proprietary battery technology. The adoption and integration of BYD’s batteries will improve the utilization of solar energy and meaningfully enlarge our global addressable market in the solar industry.”

BYD has been committed to the North America Energy Storage market for almost a decade, with the first MW-scale project deployed in the U.S. in 2011. It has remained a market leader since then.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million has grown in value sixteen-fold.

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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 Goes Big on Commercial Office Space for Grandscape

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While some question the fate of both retail and commercial office space, Berkshire is continuing to go all in on its ambitious commercial real estate development, Grandscape.

The 433 acre Grandscape, which is home to its Dallas-Fort Worth Nebraska Furniture Mart, will be teaming with Dallas-based developer Cawley Partners to add a multi-phase office development totaling more than 1.5 million square feet.

The new Class AA office development joins the sprawling Grandscape mixed-use development, anchored by Nebraska Furniture Mart and Scheels. The planned office development includes three, 500,000 square foot 17-story buildings.

Grandscape is a master-planned lifestyle center featuring more dining, retail, and entertainment venues than anywhere in the DFW metroplex.

“Our team has traveled all over the world to bring in the best mix of experiences to Grandscape, and we are very excited that corporate America will now have the opportunity to enjoy it on a daily basis,” says Jeff Lind, President of Grandscape.

“Grandscape has already raised the bar for engaging dining, entertainment, and family experiences, and corporate users are going to gravitate to this dynamic project,” says Bill Cawley, CEO of Cawley Partners.

Designed by Steven Janeway, Principal at Hoefer Wysocki, the offices are thoughtfully configured in relation to the larger mixed-use development and the post-Covid work environment. “Our team put considerable energy into designing a destination that would continue to elevate the landscape while being a timeless icon.” says Rob Welker, President and National Commercial Practice Leader at Hoefer Wysocki.

© 2020 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-Backed BYD Jumps 11% to All-Time High

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Shares of Berkshire Hathaway-backed Chinese battery and vehicle manufacturer BYD Co., Ltd. jumped 11% on Monday to a new all-time high.

BYD’s stock (BYDDF), which had been as low as $4.35 on March 23, closed at $26.38 on Monday.

The stock is up over 400% year-to-date.

A Profitable EV Company

BYD recently reported a strong third quarter with earnings per share skyrocketing 3,000% from the same quarter in 2019 at $0.093 (RMB 0.62).

The company has reported strong sales of its vehicles, including the Han luxury car, which debuted in July.

Han EV’s long-range pure electric version has a single-charge range of 605 kilometers (376 miles) based on the NEDC test cycle.

In other news, BYD recently announced it is furthering its push into the battery-powered commercial truck market with the creation of a new BEV truck company in combination with Hino Motors, Ltd., which is backed by Toyota.

The goal of the new company is to combine the strengths of both companies to develop BEVs and electric units primarily in the Asian market.

The venture plans to initially launch vehicles under the Hino brand in the first half of the 2020s.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million has grown in value over twenty-fold.

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.

McLane and RaceTrac Extend Service Agreement

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Berkshire Hathaway’s McLane Company, Inc., a leading supply chain services company providing grocery and foodservice solutions, announced today that they have renewed their multi-year service agreement with RaceTrac Petroleum, Inc.

McLane and RaceTrac’s relationship dates back to 1996, and McLane’s distribution services encompass all convenience store categories including tobacco, grocery, candy, snacks, and store supplies.

“McLane has been a valuable partner of RaceTrac and plays an integral role in keeping our stores supplied with the products our guests know and love,” says Natalie Morhous, president of RaceTrac. “We are looking forward to our continued partnership.”

McLane’s senior vice president of sales, Vito Maurici, agrees. “RaceTrac is a best-in-class retailer, and McLane is proud to support their growth and expansion initiatives. We anticipate continued success for both parties moving forward.”

RaceTrac is a privately held, family-owned corporation that operates more than 550 stores in six states. As a leader in the grocery convenience store marketplace, RaceTrac maintains its focus on growth, expecting approximately 10% year over year growth in store count as well as continuing a remodel program for a significant portion of their locations. RaceTrac is also expanding its portfolio to travel centers to better serve the professional driver and stores with an expanding diesel offering for small to mid-size fleet drivers.

Foodservice remains a key component of RaceTrac’s growth strategy by offering programs that resonate with their guests while expanding inside sales. McLane helps RaceTrac support these goals by leveraging their purchasing power, geographic distribution, and product assortment, allowing RaceTrac to offer competitive pricing across all of their stores.

“McLane helps ensure that we are able to grow and succeed. The reliability of their deliveries, both in completeness and accuracy, is essential for our stores to remain stocked and able to meet the needs of our guests,” says Jason Phillips, director of procurement at RaceTrac.

Under the renewed agreement, RaceTrac will continue to pull from seven of McLane’s 24 grocery distribution centers to provide excellent service to all of their locations. RaceTrac will also continue to utilize a number of McLane’s innovative solutions and value-adds, such as Virtual Trade Show (VTS), an internet-based trade show that offers new products and promotions from suppliers, and McLane Link, an online portal that allows retailers to access key information like order activity and metric data from their computer or tablet.

© 2020 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.

DHL Piloting BYD’s Class 8 Battery-Electric Trucks in Los Angeles

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Parcel and express mail service DHL is using BYD’s Class 8 battery-electric trucks as part of its efforts to reduce its carbon footprint.

Four of the trucks are now on the streets of Los Angeles for DHL just in time for the peak holiday shipping season. BYD’s big rigs will haul goods to and from the DHL Los Angeles International Airport gateway and local service centers.

BYD’s 8TT’s are built with long-lasting and safe battery technology, capable of running all day on a single charge. Equipped with a comfortable air-ride cab and air suspension, the trucks have more than enough power and torque to operate at 82,000 lbs. combined weight.

DHL estimates the use of the trucks will prevent more than 300 metric tons of greenhouse gas emissions from entering the atmosphere per year.

“The introduction of these efficient electric trucks is a huge step forward, not only toward achieving our own clean transport goals, but also California’s ambitious goals on the adoption of zero-emission vehicles,” said Greg Hewitt, CEO of DHL Express U.S. “By implementing these electric trucks, we will prevent more than 300 metric tons of greenhouse gas emissions from entering the atmosphere per year, as we continue to grow and enhance our clean pick-up and delivery solutions.

The new trucks enhance DHL’s already robust alternative fuel vehicle (AFV) fleet in the U.S., which includes fully electric, hybrid-electric, and clean diesel – in addition to low-power electric-assist e-Cargo Cycles.

“As a global leader in logistics and express services, DHL has proved that they’re serious about their commitment to transition to zero-emission trucking,” said John Gerra, Sr. Director of Business Development at BYD Motors. “DHL is doing more than just talking about it; they’re actually putting BYD electric trucks into commercial service, today.”

In addition, DHL Express has 72 all-electric battery-powered vans on order from multiple vendors, which will support DHL pickup and delivery operations throughout California and New York.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million has grown in value more than twenty-fold.

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, 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.

Brooks Running Has 49% Global Growth in Q3

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While indoor athletic activities were curtailed this summer and fall due to Covid, outdoors was a different matter. Items such as bicycles and running shoes were flying off the shelves.

Berkshire Hathaway’s Brooks Running reported record third quarter global revenue up 49 percent year over year, leading to a 2020 outlook of 27 percent growth.

“We believe in the positive power the run can create in someone’s day and its additive benefits over time. It is also an effective antidote in troubling times, and we’ve seen that prove true as running participation increased since March,” said Jim Weber, CEO at Brooks Running. The 2020 running boom created amidst the pandemic has been driven by people running for mental and physical health.

According to Brooks sales data, the brand gained 1.6 million runners through October of this year.

“We have worked alongside our retail, factory and distribution partners to ensure those who want to run can find the product they trust and need to bring positive energy into their lives,” Weber notes.

Despite challenges and uncertainty felt around the world caused by COVID-19 and an ensuing volatile economy, Brooks came into the global pandemic with strong product lines. Market share growth accelerated in Q3 as the brand added new runners.

According to The NPD Group, Brooks captured the largest share increase year-to-date through September in the U.S. adult performance running footwear category, gaining 4 share points versus the same period in 2019.

© 2020 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.

BYD Forming New Company with Hino to Produce BEVs

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Berkshire Hathaway-backed BYD is furthering its push into the battery-powered commercial truck market with the creation of a new BEV truck company.

BYD and Hino Motors, Ltd. have signed a joint venture to establish a new company for commercial battery electric vehicles development. The new venture is scheduled to be established in China in 2021, with BYD and Hino each making a 50% capital investment.

Hino represents the Toyota Group in the global market for medium-duty trucks, heavy-duty trucks, and buses. In 2001, Toyota Motor Corporation acquired a majority ownership of Hino Motors, Ltd.

The goal of the new company is to combine the strengths of both companies to develop BEVs and electric units primarily in the Asian market.

The venture plans to initially launch vehicles under the Hino brand in the first half of the 2020s.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million has grown in value more than twenty-fold.

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, 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.

McLane and Koupon Partner to Boost Consumer Loyalty for C-Stores

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Berkshire Hathaway’s McLane Company, Inc., a leading supply chain services company providing grocery and foodservice solutions, and Koupon, the leading promotion solution in the convenience store industry, have partnered to create a seamless integration of Koupon’s digital promotion platform with McLane’s Consumer Loyalty Program application.

McLane is well known for its innovative technology solutions for c-stores, and Koupon provides c-store retailers and CPG brands with the easiest solution to connect with shoppers and grow sales. Together, their partnership will allow c-store operators to take advantage of hundreds of industry CPG coupon offers within McLane’s Consumer Loyalty Program application, reducing product costs for both the retailer and the consumer.

Within McLane’s enhanced Consumer Loyalty Program application, consumers can access digital promotions powered by Koupon’s technology and redeem them at checkout.

There are a number of benefits to McLane and Koupon’s integrated solution, including:

• It is completely free to retailers who use McLane’s Consumer Loyalty Program.
• Consumers can search for and easily redeem coupons pertaining to their purchases at checkout.
• Consumers can receive and redeem store loyalty points based on their purchases, leading to additional offers and benefits.
• As new coupons are added, consumers can take advantage of them in real time.
• Integrated security identifies or limits age-restricted content.

“We are delighted to work with Koupon, who has distinguished itself as the industry leader in this space,” says Deon Johnson, vice president of development at McLane. “By working together, we created a solution that truly benefits both retailers and consumers.”

“This partnership is a significant milestone for the convenience store industry,” notes Brad Van Otterloo, CEO of Koupon. “Integrating Koupon’s digital promotion technology with McLane’s leading Consumer Loyalty Program will benefit the industry as a whole.”

© 2020 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.