First Solar Sells California Solar Farm to MidAmerican Energy

By Cassandra Sweet  |  WSJ  | Link to article

First Solar Inc. is selling one of its large California solar farms to MidAmerican Energy Holdings Co., ending the solar-panel maker’s search for a buyer.

The sale places MidAmerican Energy, a unit of Warren Buffett‘s Berkshire Hathaway Inc., in the solar-power business for the first time. MidAmerican operates fleets of wind farms and conventional power plants.

The companies didn’t disclose terms of the deal Wednesday, but said the Topaz solar-power plant, in San Luis Obispo County, is worth more than $2 billion.

Shares of First Solar rallied nearly 7% on the news, and traded at $49.16, up 6.7%.

The deal is the latest in a string of sales of large solar farms by First Solar and SunPower Corp. to some of the largest U.S. utilities, including NRG Energy Inc., Exelon Corp. and NextEra Energy Inc. The deals underscore the fast growth and profitability of U.S. large-scale solar-power plants, which have benefited from state and federal clean-energy incentives.

Although First Solar, of Tempe, Ariz., obtained more than $3 billion in government loan guarantees to build other large solar farms, the company was unable to get a loan guarantee for the Topaz project. First Solar nevertheless started construction last month on the 550-megawatt solar farm, which has a long-term contract to sell its electricity to PG&E Corp.’s California utility.

Buying the Topaz solar farm will allow Des Moines, Iowa-based MidAmerican, which is one of the largest U.S. wind-farm owners, to expand into solar power, said Greg Abel, the company’s chairman and chief executive. (full article)