A spokesman for Texas House Speaker Dade Phelan confirmed that the office had received the slides and had met with Berkshire regarding the plan.
“We see little to no chance of Texas approving that Buffett proposal,” said Andy DeVries, a utility analyst at CreditSights. “If they were going to spend that amount of money — which is a big if — they would do it with Texas companies.”
Berkshire Hathaway’s plan was first reported by the Dallas Morning News.
The historic Texas outage hit during a rare and powerful winter storm that sent demand for electricity skyrocketing. At least 110 people died in the cold, and economic losses total as much as $129 billion.
Berkshire is calling its proposed company the Texas Emergency Power Reserve and could have its plan operational by the winter of 2023, according to the slides. The proposal would cost less than winterizing the state’s power generators or creating a so-called capacity market where generation units are paid to provide supplies in future years, according to Berkshire.
The additional capacity created by Berkshire would ensure that no customer would be without power for more than three hours, the company said. The Texas Reliability Corp. would offer a $4 billion performance guaranty provided by an investment graded counterparty.
Height Securities analyst Josh Price said he was “skeptical” that the idea would have traction with lawmakers.
“The key question will be whether policymakers are willing to forego market-based principles if a non-competitive approach would be more cost-effective,” he said in an email.