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Warren Buffett is betting on solar power, with one of Berkshire Hathaway’s (BRK.B) companies behind a project to build the largest solar power plant in the U.S.

Berkshire subsidiary NV Energy will be using the electricity generated by a 690-megawatt solar-energy plant to be built on federal land in Nevada. The current record for a solar plant is 579 megawatts.

On Monday, the Bureau of Land Management released an environmental-impact statement about the project, indicating that it would approve the project after a 90-day period for public comment, as first reported by the Los Angeles Times. While the Trump administration hasn’t been friendly to solar power, opposing a plan last year to extend tax incentives, a federal official praised the Berkshire project as being part of an “America First Energy Plan,” echoing nationalist rhetoric the president has used to describe other parts of his agenda.

The so-called Gemini project, which will generate power for NV Energy companies but will be developed by third parties, will be 25 miles from Las Vegas. That project and two others will create 1.19 gigawatts of new power for NV, enough to provide electricity to 230,000 homes. The projects also come with 590 megawatts of battery-storage capacity, meaning the power generated by solar panels can be stored for times when the sun isn’t shining.

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Buffett said in a 2016 investor letter that he was convinced renewable sources would grow in importance, which is why the company’s Berkshire Hathaway Energy subsidiary was investing in them. “Last year, BHE made major commitments to the future development of renewables in support of the Paris Climate Change Conference,” he wrote. “Our fulfilling those promises will make great sense, both for the environment and for Berkshire’s economics.”

Buffett’s commitment to environmental goals has been challenged in the past. Berkshire Hathaway Energy was previously criticized for opposing “net metering” rules that pay rooftop solar generators for the power they send back into the grid. Without net metering, rooftop-generated solar energy is less cost-competitive in many states. Some environmentalists have also criticized the Gemini project because of its impact on wildlife, including tortoises in the area.

Regardless of the environmental debates, Berkshire’s embrace of solar energy makes it clear that the technology is becoming progressively more cost-competitive with fossil-fuel-driven power. The Gemini project will cost $38.44 per megawatt hour under a 25-year contract, the L.A. Times reported, while Lazard has calculated that the average national cost of a new natural-gas plant ranges from $44 to $68.

State mandates are helping drive wider adoption of renewable energy. Nevada has mandated that utilities get at least half their power from renewables by 2030. Companies that have embraced renewables have seen their stock prices rise. NextEra Energy (NEE), a utility company that has taken a lead role in developing renewable projects, trades at 27 times 2020 earnings expectations, while competitors trade at less than 20 times. Utilities that aren’t investing as heavily in renewables are likely to continue to be left behind.

Write to Avi Salzman at avi.salzman@barrons.com