Berkshire Hathaway 2014 Annual Report Download - page 118

Management’s Discussion (Continued)
Commodity Price Risk (Continued)
To mitigate a portion of the risk, BHE uses derivative instruments, including forwards, futures, options, swaps and other
agreements, to effectively secure future supply or sell future production generally at fixed prices. The settled cost of these
contracts is generally recovered from customers in regulated rates. Financial results would be negatively impacted if the costs of
wholesale electricity, fuel or natural gas are higher than what is permitted to be recovered in rates. The table that follows
summarizes commodity price risk on energy derivative contracts of BHE as of December 31, 2014 and 2013 and shows the
effects of a hypothetical 10% increase and a 10% decrease in forward market prices by the expected volumes for these contracts
as of each date. The selected hypothetical change does not reflect what could be considered the best or worst case scenarios.
Dollars are in millions.
Fair Value
Net Assets
(Liabilities) Hypothetical Price Change
Estimated Fair Value after
Hypothetical Change in
Price
December 31, 2014 .................................... $(192) 10% increase $(111)
10% decrease (272)
December 31, 2013 .................................... $(140) 10% increase $ (72)
10% decrease (208)
FORWARD-LOOKING STATEMENTS
Investors are cautioned that certain statements contained in this document as well as some statements in periodic press
releases and some oral statements of Berkshire officials during presentations about Berkshire or its subsidiaries are “forward-
looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking
statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which
include words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates” or similar expressions. In addition,
any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business
strategies or prospects and possible future Berkshire actions, which may be provided by management, are also forward-looking
statements as defined by the Act. Forward-looking statements are based on current expectations and projections about future
events and are subject to risks, uncertainties and assumptions about Berkshire and its subsidiaries, economic and market factors
and the industries in which we do business, among other things. These statements are not guarantees of future performance and
we have no specific intention to update these statements.
Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a
number of factors. The principal important risk factors that could cause our actual performance and future events and actions to
differ materially from such forward-looking statements include, but are not limited to, changes in market prices of our
investments in fixed maturity and equity securities, losses realized from derivative contracts, the occurrence of one or more
catastrophic events, such as an earthquake, hurricane or act of terrorism that causes losses insured by our insurance subsidiaries,
changes in laws or regulations affecting our insurance, railroad, utilities and energy and finance subsidiaries, changes in federal
income tax laws, and changes in general economic and market factors that affect the prices of securities or the industries in
which we do business.
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