Thursday, May 30, 2013

Buffet Buys Nevada Energy After Nevada Senate Orders Natural Gas & Renewables To Replace 800 Megawatts Of Coal

Ten years ago, when the nation was getting ready to build more than 150 new coal-fired power plants, the idea of a state passing legislation that closed coal plants and replaced them with natural gas and renwables would have been truly laughable.  Times change and quickly.

The Nevada state senate just passed--unanimously--a bill that requires the closure of 800 megawatts of cal generation and its replacement by 550 megawatts of natural gas and 350 megawatts of renewable energy capacity.  The state's biggest utility, its GOP Governor, and Harry Reid all supported it.

As this bill shows, Nevada is also one of the majority of states that still has legislatures and public utility commissions decide what kind of generation is built in a state. Political choice, not market choices, still substantially dictates what generation gets built in America.

Across America, natural gas and renewable energy is now providing 100% of the nation's new electric generation capacity.  And Warren Buffet, who is one of the nation's biggest investors in wind and solar generation, likes the trend.

Indeed, yesterday Buffet bought Nevada Energy, a utility serving Las Vegas, for $5.6 billion, and I suspect Buffet viewed the move toward more renewable generation in Nevada as a reason to make the purchase.

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