Buffett Still Banking on Energy—BHE Announces Canadian Wind Farm

The evolving landscape of power includes not only new types of generation, but also involves new investors, including some of the most well-known names in global business.

Bill Gates, who co-founded Microsoft with the late Paul Allen, formed Breakthrough Energy Ventures (BEV) in 2016, a group that supports battery energy storage, nuclear power innovation, geothermal, and hydropower technology, among others. Amazon’s Jeff Bezos, ranked as the world’s richest individual in Forbes magazine’s annual rankings of billionaires (Gates is second), also is an investor in BEV, and Amazon Web Services (AWS) topped 50% renewable energy usage in 2018. AWS operates several wind and solar farms.

Michael Bloomberg, the media mogul and former New York City mayor, is an investor in BEV. So is Virgin’s Richard Branson, and Alibaba’s Jack Ma.

Berkshire Hathaway a Big Energy Investor

Warren Buffett is ranked third on Forbes’ list. His Berkshire Hathaway firm, headquartered in Omaha, Nebraska, and considered among the world’s largest public companies, has substantial investments in power generation worldwide, including traditional sources such as coal and natural gas. Berkshire Hathaway Energy (BHE) has said it will spend $900 million over the next few years to reduce regional haze impacts from its coal-fired plants, after spending $1.4 billion to reduce emissions from its coal plants from 2005 to 2012.

Among BHE’s utility holdings in the U.S. are PacificCorp, NV Energy, and MidAmerican Energy Co. It also runs Northern Powergrid in the UK, and AltaLink in Alberta, Canada.

BHE’s future, though, may lie with investments in renewable energy. Wind energy at present accounts for 60% of the company’s renewables portfolio, and BHE on Oct. 15 added to that total as it announced construction of a privately funded $200 million, 118-MW wind farm in Calgary, Alberta. The Rattlesnake Ridge Wind project—ground is expected to be broken in 2020—will include as many as 28 turbines, BHE said.

No Government Subsidies

The new United Conservative Party government, elected in April, ended subsidies for renewable energy projects in Alberta. BHE said it will finance the Rattlesnake Ridge project with equity and debt.

“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 of corporate development of BHE Canada, in a statement. “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.” BHE Canada was formed when Berkshire Hathaway acquired AltaLink in 2014.

BHE said an unnamed “Canadian corporate partner” has signed a power purchase agreement (PPA) for generation from the wind farm, which is expected to begin commercial operation by year-end 2021. UK-based Renewable Energy Systems (RES) will develop the project.

BHE Canada and RES already have permits for the proposed 398.5-MW Forty Mile Wind Farm in southeastern Alberta, and BHE has said it is looking to secure PPAs. That project as currently designed would be the largest wind power project in Canada.

The Canadian Wind Energy Association said Alberta is the third-largest wind energy market in Canada with 1,438 MW of installed capacity as of December 2018. Wind power produces about 7% of the province’s electricity.

Darrell Proctor is a POWER associate editor (@DarrellProctor1, @POWERmagazine).