Wednesday, July 29, 2015

Don't Bet Against Buffett -- July 29, 2015


April 18, 2016: because of the SRE natural gas leak this past year in southern California, and the removal of much of California's supply of natural gas, there is talk of blackouts in California this summer. This guy thinks the "big story" this summer will be solar energy and battery storage.
The problem with his analysis: once the blackouts start, rooftop solar can't ramp up fast enough.And for the 1% of Californians that have rooftop, it's all residents; not industrial parks. So, the 1% with electricity will get to stay home to enjoy their appliances because they will be laid off because their assembly line has shut down.  

Original Post
When you get to the Tesla article below, note this: oilfield brines: deposits of lithium are contained in oil field brines in Alberta, North Dakota, Wyoming, Oklahoma, east Texas and Arkansas where brines grading up to 700 ppm are known to exist. Other oilfield brine lithium deposits exist, most notably in the Paradox Basin, Utah; however, global reviews for deposit size, potential yield and production cost estimates are not available.

The list of "Big Stories" that I follow is getting a bit long, but nevertheless I've added batteries/storage to the list of "Big Stories."


Predicted from the day ObamaCare passed; insurers will be the big winners. Anthem beats estimates by 33 cents with adjusted quarterly profit of $3.10 per share, with revenue also above estimates. The company-which recently announced a deal to buy Cigna - also increased its projected full year enrollment growth for medical insurance.


This is not an investment site. Yada, yada, yada.


Tesla recovers, surges. But this is the big story, from OilPrice, a hedge fund source -- Warren Buffett and Elon Musk to spark a lithium boom.
The age of electrification across the transportation sector, the solar panel revolution, and Tesla’s battery gigafactory are igniting a battle for the cheapest battery. That will transform lithium into a boom-time mineral and the hottest commodity on the energy investor’s radar.
It has been easy to take lithium for granted. This wonder mineral is the backbone of our everyday lives, popping up in everything from the glass in our windows to our mountains of electronics.

And while investors have long appreciated the steady rise in demand for this preferred mineral, the number of new applications continues to multiply. Smart phones, tablets, laptops, and other consumer electronics demand more lithium. But the largest driver for future lithium use will be in electric vehicles and home batteries for solar panels. That has lithium on the verge a boom for which supply can no longer be taken for granted.

Not since the shale boom have we seen a market transformation of such significance. Lithium has long been used for a variety of mundane purposes, and while the variety is spectacular—with applications in everything from glass, ceramics and greases to a line-up of industrial process—it has flown under the radar for most investors.
Tesla’s biggest rival will likely be Build Your Dreams (BYD), the Chinese automaker backed by Warren Buffet. Already, BYD is building electric buses on American soil and has global gigafactory ambitions. By the end of the year, according to Reuters, BYD should have 10 GWh of battery production capacity, which it expects to increase to 34 GWh by 2020 with a new factory in Brazil—about the same capacity as Tesla’s.
Other Tesla rivals rushing to the battery production scene will be iPhone manufacturer Foxconn and LG Chem, which is already one of the top three battery makers. Samsung is also hot on the trail, having just acquired Magna’s battery production division.
Types of lithium?
Not all lithium is equal. It’s sold in different types for different prices. For instance, lithium carbonate sells for around $6,000 per ton and is used to make some of the materials for new battery technology.
However, many of the new battery technologies—particularly those used by Tesla—use lithium hydroxide as the starting material, which trades at around $2,000 more per ton than lithium carbonate. lithium found in salty water, or brines, is by far the most cost effective.
Brine is the best way to produce lithium because it’s so cheap, as nature has done all the hard work in rendering the lithium into a form that is easy to extract from the ground. All you have to do is drill a few wells and pump the liquid brine.”
Buffett Is Now #1 In Solar Also

The Motley Fool is reporting:
The largest solar project in the world, Solar Star, is now operational in California and demonstrates Berkshire Hathaway's commitment to developing renewable energy assets.
Warren Buffett is famous for a number of bright ideas on investing, but this may be the brightest.
Just how bright?
About 579 megawatts' worth of solar-generated power from a single facility. Financed by BHE Renewables, a wholly owned subsidiary of Berkshire Hathaway, Solar Star is the world's largest solar project to date, and it began contributing power to the California grid on June 19.
Consisting of about 1.7 million SunPower solar panels, the facility will produce enough power to annually supply approximately 255,000 homes with electricity. BHE Renewables will sell the electricity to Southern California Edison under a long-term power purchase agreement.
BHE Renewables has wind, geothermal, hydro, and natural gas assets in its 3,470 MW portfolio, but solar, at 1,271 MW, represents the largest portion.
When it became operational, the Solar Star projects, two separate farms located in Kern and Los Angeles counties, supplanted another BHE Renewables-owned project as the largest in the world. Located in San Obispo County, CA, Topaz Solar Farms is a 550 MW facility consisting of over 8 million First Solar photovoltaic modules. Pacific Gas and Electric, a subsidiary of PG&E Corp, will purchase the electricity under a 25-year power purchase agreement.
Rounding out its solar projects is Agua Caliente, a 290 MW facility -- also supplied with First Solar PV modules -- in which BHE Renewables has a 49% interest. The facility is located in Yuma County, AZ.

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