Warren Buffett's energy holdings company is buying a mammoth solar plant being built in the Carrizo Plain, just west of the San Joaquin Valley.
MidAmerican Energy Holdings said it is acquiring the $2 billion Topaz Solar Farm in San Luis Obispo County from First Solar because it expands the company's renewable energy portfolio and because it, "...demonstrates that solar energy is a commercially viable technology without the support of governmental loan guarantees..."
The purchase occurred after First Solar failed to get a federal loan guarantee to secure construction of the plant, according to this Reuters story.
Buffett, known as the "Oracle of Omaha," already invests in wind energy and in China's BYD Co. Ltd., which makes electric cars and batteries, and has other green technologies, including solar. This purchase of a 550-megawatt photovoltaic power plant - enough to power 160,000 homes when it is finished in early 2015 - is a sign of support for the emerging solar industry. It also follows the high-profile implosion of Solyndra, a solar company that failed after receiving a $535 million government loan guarantee.
First Solar will build and operate the plant for MidAmerican. Construction began in November and will create about 400 construction jobs and 15 permanent operations and maintenance jobs. The expected economic impact on the region during construction is expected to be abut $417 million over 25 years.
The Carrizo Plain, along with Kern, Kings and Fresno counties, is part of a region in Central California that is a potential hotbed for solar projects. Kern and Fresno counties alone are fielding more than 60 applications, according to this recent blog post. Those include a proposal for a huge solar farm in Westlands Water District that would cover 3,600 acres of retired farmland. Find out more here.
Meanwhile, officials in various counties and in the state are trying to balance the interests of farmers with those of this potentially new industry. Much of that conflict revolves around the Williamson Act, which protects farm land from development. A law signed in November, SB 618, attempts to help ease those conflicts. (Here is more on that bill)
Buffett wouldn't have invested in this solar plant if he didn't expect rosy returns, including some impressive government incentives, according to this blog post. And it remains to be seen how large the solar industry will become in Central California, but this investment by one of the nation's richest men shows that solar is becoming more viable, particularly in California.
Photo of Carrizo Plain National Monument from Bureau of Land Mangement