One of the world's most successful investors is making his next big bet in a fitting place: Las Vegas.

Warren Buffett's Berkshire Hathaway announced late Wednesday it will pay $5.6 billion to acquire NV Energy – the company that keeps the lights on in the casino capital and other parts of the state. Nevada's largest utility will join MidAmerican Energy Holdings, Berkshire's energy subsidiary, in the largest acquisition of a US power company since last July when Duke Energy bought Progress Energy for $17.8 billion.

It's a relatively safe investment. Because of their monopoly on the local market, utilities typically promise steady growth. Mr. Buffett himself quipped at a meeting of US state regulators in 2006 that utilities aren't a way to get rich, but a way to "stay rich."

Renewables are a big part of the acquisition. NV Energy will contribute 1 gigawatt in wind, solar, and geothermal to MidAmerican, which is a big investor in government-financed solar plants and is currently working to meet Nevada's requirement that utilities derive at least 25 percent of their energy from renewables. That's good news for a state short on oil and gas, but with big potential for wind, solar, and geothermal.

“By joining forces with MidAmerican, we will gain access to additional operational and financial resources as we continue to position NV Energy to support the evolving energy needs of our state and work with public policy leaders and regulators to reshape Nevada’s energy future,” said Michael Yackira, president of NV Energy, in a statement. “Importantly, we will have the opportunity to combine MidAmerican’s expertise in renewable energy with Nevada’s vast renewable resources for the benefit of our customers and our state."

The low-profile state could use a high-profile injection of cash. Nevada was a center of the housing crisis of 2007 and has been hit hard by the economic downturn. That might make it a more risky investment, but recently the state has showed signs of rebounding.

"We believe this is a bet on growth in the West," Shanthi Muthiah, vice president of the Virgina-based consulting firm ICF International, wrote in an e-mail. "Buffett sees value in solid businesses that have been hurt by the recession but are poised to grow rapidly."

Not everyone is thrilled with the news though. Investors buy companies to make money, not necessarily to benefit customers, writes J. Patrick Coolican. a Las Vegas Sun columnist.

"When it comes to their revenues, it’s a pretty simple equation: More money for them means less money for us, the ratepayers," Mr. Coolican wrote. "And that’s not just you and me in our homes and apartments. It’s also businesses that have less money to hire people because they pay more for electricity."

Greg Abel, MidAmerican's chairman, president and chief executive, was a prime mover behind the acquisition. But Buffett gave his approval, Mr. Abel said in various interviews. Once the acquisition is complete, MidAmerican will have about $66 billion in assets and will serve 8.4 million customers through its regulated electric and gas utilities.

Get the Monitor Stories you care about delivered to your inbox. By signing up, you agree to our Privacy Policy

Buffett, in his usual pithy, folksy way, gave a nod to the residents of Nevada in a press release announcing the acquisition.

“This is a great fit for Berkshire Hathaway, and we are pleased to make a long-term investment in Nevada’s economy,” Buffett said in the statement. “Through MidAmerican, we have found in NV Energy a great company with similar values, outstanding assets, and a superb management team.”