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December 21, 2014

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Sierra Club won’t oppose Warren Buffett buying NV Energy

Club had previously said purchase of utility may result in coal plants not being shut down; hearing on sale to start Monday

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Nati Harnik / AP

In this Nov. 14, 2011, photo, billionaire investor Warren Buffett speaks in Omaha, Neb., at an event to raise money for the Girls Inc. charity organization.

The Sierra Club is dropping its opposition to the $5.6 billion sale of NV Energy to billionaire Warren Buffett.

Buffett's MidAmerican Energy Holdings Co. reached the deal to acquire NV Energy, Nevada’s primary electric utility, in May. NV Energy is the parent company of Nevada Power Co. in Las Vegas and Sierra Pacific Power Co. in Reno. It serves an estimated 2.4 million electric customers in Nevada.

A stipulation was filed Friday with the Nevada Public Utilities Commission in which the Sierra Club says that MidAmerican has agreed to continue plans to shut down the coal-fire Reid Gardner Power Plant, accused of being a major source of carbon dioxide air pollution.

This removes another obstacle in the proposed sale and comes days before the PUC is to begin hearings Monday on the transaction.

Gloria Smith, attorney for the Sierra Club, said the Sierra Club will withdraw its testimony, which said the club had "serious concerns" about the proposed purchase.

In its earlier filing, the Sierra Club, which has 4,500 members in Nevada, said MidAmerican has the largest coal-generation fleet in the West and that the potential merger may pose risks to the public, including affecting the plans to retire Reid Gardner in Southern Nevada.

The stipulation filed Friday says MidAmerican is committed to retire the three units at Reid Gardner on or before Dec. 31, 2014, and has agreed to "thoroughly evaluate the retirement" of the coal-fired North Valmy Generating Station's Unit 1 in Northern Nevada by Dec. 31, 2021.

Last week, an agreement was reached between MidAmerican, NV Energy, the state Bureau of Consumer Protection and the PUC that includes a $20 million credit to be applied to customers' bills when the deal is completed because the utility earned excessive returns. Smith said the Sierra Club will not file any opposition to that plan.

In addition, the club, MidAmerican and NV Energy will meet within 90 days after the close of the sale to discuss the suits filed by the club aimed at shutting down Reid Gardner.

The stipulation says NV Energy in early 2014 will file plans to use more renewable energy facilities. In earlier prepared testimony, MidAmerican President William Fehrman said his company is committed to renewable energy. He said MidAmerican is now building three of the largest solar plants in the world in Dateland, Ariz., and in Santa Margarita and Rosamond, both in California.

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