MidAmerican Energy Holdings Company (MEHC), the second largest US wind and solar asset owner and part of billionaire Warren Buffett’s Berkshire Hathaway holding company, increased net profit in 2013 to $1.64bn.
Net income in 2012 was $1.47bn. Revenue last year increased to $12.74bn versus $11.74bn in 2012.
Results include NV Energy, Nevada’s largest electric utility, after MEHC’s acquisition last 13 December for $5.6bn
Berkshire released its 2013 annual report on Saturday. The parent company earned a record $19.5bn versus $14.8bn a year earlier in response to an improving US economy.
Owned 89.8% by Berkshire, MEHC’s main units are utilities in the US Midwest and Pacific Northwest, an electricity distributor in the UK, plus natural gas pipeline companies and the second largest independent residential real estate brokerage firm in America.
The utilities own most of MEHC’s 3.7GW of wind generation capacity with another 1.05GW under construction. For solar, MEHC in 2012 acquired a 1.27GW portfolio of utility-scale projects including what will be the world’s largest PV array, the 579MW (AC) Solar Star I and 2 in California.
In a letter to shareholders, Buffett says that once current solar and wind projects are completed, MEHC will have cost $15bn. “We relish making such commitments as long as they promise reasonable returns. And on that front, we put a large amount of trust in future regulation,” he writes.
“Our confidence is justified both by our past experience and by the knowledge that society will forever need massive investments in both transportation and energy. It is in the self-interest of governments to treat capital providers in a manner that will ensure the continued flow of funds to essential projects,” he adds. “It is meanwhile in our self-interest to conduct our operations in a way that earns the approval of our regulators and the people they represent.”
Turning to NV Energy, Buffett says the acquisition offers “many possibilities” for large investments in renewable energy. He did not provide details.
“NV Energy will not be MidAmerican’s last major acquisition,” he writes. The utility serves 88% of Nevada’s population.