The utility operation owns the largest fleet of windmills in the U.S. while his railroad, Burlington Northern, is the largest hauler of coal in the country and the largest transporter of oil out of the Bakken field. There are a couple other tie-ins to climate that we've looked at over the years, some links below.
From The New Yorker:
Last week, the White House released the National Climate Assessment, and the news is grim. Coral reefs are dying, shellfish will increasingly make us sick, and cherries are being decimated by weather extremes. Along the Eastern Seaboard, waters will rise up to four feet—perhaps six feet—by the end of the century, making Sandy-like storm surges a frequent event. California will continue to burn. Arizona will continue to burn. For most businesspeople, climate change seems bad for the bottom line.
But if you, like Berkshire Hathaway C.E.O. Warren Buffett, work in the disaster business, reports like the National Climate Assessment, all eight hundred and twenty-nine pages of it, are free advertising. In a recent television appearance, Buffett suggested that global warming—at least the idea of it—has been good for the insurance industry. “I love apocalyptic predictions on it because, you’re right, it probably does affect rates,” he told an interviewer. “The truth is that writing U.S. hurricane insurance has been very profitable in the last five or six years.”
Buffett’s insurance companies have yet to adjust how they calculate their exposure to hurricane risk, he explained, though “that may change in ten years.” They haven’t been hoarding more cash to prepare for bigger storms; they haven’t been cancelling policies. His point was not that climate science is a sham but that what it has mostly done—for now, for him—is to prop up revenues and bring in new customers.
By 2012, insurers had introduced eleven hundred and forty-eight climate-change products and services in fifty-one countries, according to a review by the Lawrence Berkeley National Laboratory. If you’re an executive today, for instance, especially if your business emits carbon, you may be interested in a policy from Liberty Mutual that protects against what the company calls “the continuously growing wave of litigation stemming from the alleged improper release of carbon dioxide and other greenhouse gases.” If you’re poor and African, you may be interested in reinsurer Swiss Re’s early efforts to insure you and four hundred thousand of your compatriots against drought. A 2007 program promised an eighteen-million-dollar climate-adaptation payout to subsistence farmers if the right “weather trigger” was hit, with premiums paid by international donors.Of the reinsurers Munich Re is the first to blame climate change for their weather related claims with industry #2 Swiss Re often following suit. The smaller Hannover Re doesn't do this. Zurich Re, along with the rest of the industry, is less vocal. Buffet's Re operations rank #3 in the world and is much better managed than Munich and Zurich so he often ends up taking risk off their hands or even lending them money.
In 2008, while investigating how the insurance industry was faring in a warming world, I rode into a series of suburban wildfires near Los Angeles with a fire chief who worked part-time for A.I.G., the giant insurer that was then on the verge of being bailed out by the federal government. The company operated a squad of private firefighters, and, as helicopters clattered overhead, members of the A.I.G. team mostly drove around in haphazard circles, checking on client homes and sometimes spraying them with a fire retardant. They snuck across police lines. They made sure that A.I.G. clients had been evacuated. They made sure that brush wasn’t too close to any A.I.G.-protected structures. They stopped to get tacos, sip sodas, and watch news about the fire on a taqueria’s television set. They exchanged uneasy glances with public firefighters. They parked their trucks on a residential street for the better part of an hour and watched the public guys battle the blaze. The privateers didn’t do much good that day—not even for their own clients—but they made good money.
A boutique firefighting service is just one way that the insurance company attracts “high net worth individuals” to its private-client group. Another way, available in parts of Florida, New Jersey, New York, Massachusetts, and South Carolina, is its hurricane-protection Unit: a jump team of contractors that arrives at your house armed with tarps and hammers, racing to beat looters and rain. If there are any holes, it patches them. If your expensive paintings or sculptures are threatened, it evacuates them.
The National Climate Assessment is, in fact, just what Buffett suggests: an argument for more insurance. As we face the future, insurance can help us grapple with the true cost of the present—something that we’ve largely proved incapable of doing by ourselves....MORE
Insuring weather over the last decade has been extremely profitable as premiums charged have been high-although declining as hedge funds and other non-traditional funders "want to get me some of that action"-and payouts on claims have been very agreeable.
Previously:
July 2007
Warren Buffet on Global Warming
...From the 2006 Letter to Shareholders (page 3):February 2008
All that said, a confession about our 2006 gain is in order. Our most important business,
insurance, benefited from a large dose of luck: Mother Nature, bless her heart, went on vacation. After hammering us with hurricanes in 2004 and 2005 – storms that caused us to lose a bundle on super-cat insurance – she just vanished. Last year, the red ink from this activity turned black – very black. In addition, the great majority of our 73 businesses did outstandingly well in 2006....
Who Cares What Warren Buffett Thinks About Global Warming? (BRK.A)
From 2009's "'Why Warren Buffett Is Wrong About Cap and Trade: Eric Pooley' (BRK.A)":
See also:
Warren Buffett on Cap-and-Trade (BRK.A)January 2010
That's the Last Time I Look to 'Rolling Stone' for Climate; Investing Advice: "The Climate Killers: #1 Warren Buffett" (BRK.A; BRK.B)
What a bunch of moron poseurs.And many more. If Interested try http://climateerinvest.blogspot.com/search?q=buffett+global+warming or 'climate change' and reinsurance, Buffett or, hell what am I saying you're smart, you know what you want.
