Subject: Re: Berkshire's decline
"This is why we have Buffett and Able saying the electric companies cannot be an insurer of last resort. In determining rates, Public utility commissions do not take the assessed replacement value of real estate into account at all.

The original thesis in this investment was Berkshire would have the ability to invest massive amount of capital for reasonable returns set by the PUCs. But that hasn’t borne out either due to lack of appetite from governments to resolve energy issues. Berkshire even had a solution to Texas’ power grid problem, but was met with “no thanks”."

The above comment by ValueOrGoHome taken together with Mungofitch's earlier comment about future rate increases are beholden to the "kindness of strangers" thinking are why we may see Berkshire's Energy companies spun out of the Berkshire mother ship one day. Take those state and federal regulated entities out of Berkshire so the mental aspect of short-term elected officials who pick state energy commissioners can move away from seeing the utility companies as not having the association with a deep pocketed mother ship that is Berkshire Hathaway. The same mental model applies to those pursuing lawsuits. I would think it is psychologically more difficult to award a big sum to a local company that has limited resources than to tack on a big sum to the same company that is affiliated with a whopping cash rich mother ship like Berkshire.

Spin out these utility companies to Berkshire shareholders and we will likely eventually benefit from these entities getting favorable rates, relaxed restrictions and maybe some legislation that reduces their future fire related liabilities. Who knows, maybe these energy companies in time increase in value and throw off cash to those of us who elect to hold these companies in our portfolios?

Of course, I may be entirely wrong with this line of thinking. Thoughts?

Uwharrie