Recently, Warren Buffet, often referred to as the “Oracle of Omaha” for his legendary investment strategies, offered a recipe for success in an annual report published by Buffet’s Berkshire Hathaway Inc. Buffet named three “key ingredients” for companies to remain profitable and competitive in the 21st century: invest in “people, communities and the environment,” advising that “taking shortcuts is not the pathway to achieving sustainable competitive advantage, nor is it an avenue toward satisfying customers.”
Buffet also noted that “today our world is changing faster than ever before – economic, geo-political and environmental challenges abound.” Berkshire Hathaway has made significant forward looking investments in renewable technologies including solar. If we heed his words, a smart strategy would be to invest in infrastructure for the future—for example, to link remote areas of the west that contain many of the country’s most excellent renewable energy resources. As Warren Buffet prophesizes, gaining competitive advantage requires businesses to think long term about where people live, how to tread lightly on the land and technologies with a long shelf life.
Remarkably, Congress recognized the wisdom of protecting “people, communities and the environment” over 40 years before Buffet offered his multi-billion dollar advice. In 1969, Congress passed the National Environmental Policy Act (NEPA) with overwhelming, and now rare, bipartisan support. The law requires that before undertaking projects that may significantly affect the environment, including air and water resources, federal agencies must assess the impacts of proposals, solicit the input of all affected stakeholders and disclose their findings publicly.
Critically, NEPA recognizes that the public – which includes industry, landowners, local and state governments and business owners – can make important contributions by providing unique expertise. NEPA’s common sense axiom is simply “look before you leap,” which is exactly the type of smart investment strategy Warren Buffet prescribes.
If Buffet’s advice doesn’t win you over, heed the advice of the national security experts, which advocates that renewable energy project developers should consult with military bases at the initial “napkin planning stages” of project development, a practical step towards avoiding project delays due to conflicting uses of the land.
Nowhere are the benefits of public input and environmental analysis more evident than in the current solar development and planning efforts taking place across the west. Solar development has shown NEPA is working—the average time for environmental review for utility-scale solar projects on public lands in 2010 was 1.4 years, well within other permitting time frames for similarly sized projects, and remarkable given these projects’ are unique in scale and complexity.
To spur further responsible investment in large-scale solar , the Department of the Interior has nearly completed a six-state study of the best solar resources on public lands with the lowest environmental and other conflicts. This process—afforded under NEPA’s “programmatic” review, will lead investors and developers to low conflict project sites across the southwest, and result in better projects. Using the NEPA process, the DOI has received invaluable input from industry groups, other agencies, environmental groups and concerned citizens.
Recently however, many in Congress have failed to recognize that long-term economic competitiveness requires both investment in sustainable technologies and robust environmental review. In the past year alone, over forty pieces of legislation have been proposed which aim at weakening or waiving NEPA’s requirements for public participation and early environmental analysis. In reality, circumventing environmental review has the potential to result in “real” costs to projects by ignoring potential alternatives, inviting litigation and delaying permits. And as Mr. Buffet’s advises “taking shortcuts is not the pathway to achieving sustainable competitive advantage” – what’s good for the environment is good for the bottom line.
This piece was co-authored by Stephen Schima of the Partnership Project.