Buffett Says He Loves Renewables, So Why Is His Company Trying to Kill Solar Energy? - by Joe Romm

Warren Buffett’s recent annual letter to shareholders extols renewable energy.  Yet he fails to mention that his company is working to crush solar energy in Nevada and around the western United States.

In Part One, I explored how Buffett, despite being one of the world’s most successful investors, mistakenly downplays the climate risk to his company,  Berkshire Hathaway (BH). In particular, he fails to tell investors of the climate risk associated with his massive $1.1 billion investment in Canadian tar sands giant Suncor, a company that can only make a big profit by helping to destroy a livable climate.

Buffett’s letter is equally questionable on renewable energy.  The “Oracle of Omaha” portrays himself and BH as a friend to renewables.  For instance, Buffett says of his energy subsidiary, Berkshire Hathaway Energy (BHE):  “Last year, BHE made major commitments to the future development of renewables in support of the Paris Climate Change Conference.  Our fulfilling those promises will make great sense, both for the environment and for Berkshire’s economics.”

“That company has invested $16 billion in renewables and now owns 7% of the country’s wind generation and 6% of its solar generation,” Buffett’s letter elaborated.  “Indeed, the 4,423 megawatts of wind generation owned and operated by our regulated utilities is six times the generation of the runner-up utility.  We’re not done.”

Yet his solar-hyping shareholder letter never mentions that BHE owns NV Energy, which almost single-handedly destroyed the exploding solar rooftop market in Nevada.  As we reported last year, Buffett’s utility successfully lobbied the Nevada Public Utilities Commission (PUC) to slash the “net metering” payments to solar customers for the electricity they put back on the grid (when their rooftop PV generates more power than they themselves are using at the moment).  NV Energy defeated Elon Musk’s SolarCity, a very big solar installer, which lobbied against the massive rate hike.

Customers who buy solar will no longer be paid for any excess electricity at the retail rate (some 11 cents per kilowatt-hour). Instead they’ll be paid a rate that keeps dropping until it hits the wholesale rate (2.6 cents per kwh) — “even though the utility doesn’t have to pay for any of the solar panels’ hardware or maintenance, and transmission costs are negligible, since the electricity is being generated close to where it is used.”

Thanks to its successful lobbying, NV Energy will ultimately be able to take whatever excess electricity it buys from solar customers at 2.6 cents per kwh and simply sell it to other customers at 11 cents! Now that is capitalism.

Even worse, NV Energy got the PUC to to punish people who already bought solar! The change in net metering will be applied even to customers who bought solar under the previous rate structure. So if you got a PV system in good faith under a rate structure in which it was economical, you still get screwed, by possibly as much as $11,000 over the next 20 years. That kind of sounds more like greed than capitalism.

Significantly, while the NV PUC voted 3-0 for this new rate structure in late 2015, a year earlier they issued a report finding that rooftop solar customers actually give back more to the grid than they cost.

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