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May 4, 2021, 8:30 a.m. EDT

Warren Buffett baffles many on green energy — what about heir apparent Greg Abel?

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Rachel Koning Beals

Greg Abel,  the likely successor  to Warren Buffett as Berkshire Hathaway CEO, directed the company’s move into renewable energy as the head of Berkshire’s large utility business.

By most accounts, it’s too soon to predict if that pedigree will translate into a more aggressive green shift for a conglomerate whose exposure across so many sectors means that it wants a bite at clean energy while simultaneously keeping up stakes in fossil-fuel industries.

Vice Chairman Charlie Munger indicated at the Berkshire Hathaway /zigman2/quotes/200060694/composite BRK.B -1.67% /zigman2/quotes/208872451/composite BRK.A -1.82% annual meeting Saturday that it will be the 59-year-old Abel to eventually step in at the top. Buffett, 90, himself confirmed as much in a weekend comment to CNBC. “The directors are in agreement that if something were to happen to me tonight, it would be Greg who’d take over tomorrow morning,” he said.

Opinion: Berkshire Hathaway after Buffett: Who will be CEO, what else will change — and what won’t

Edward Jones analyst Jim Shanahan told the Associated Press that Abel brings confidence to stock-watchers.

“I think he has proven to be a really effective leader,” said Shanahan, who added that Abel handled questions about Berkshire’s efforts to respond to climate change well at the annual meeting.

Abel has been with Buffett for more than two decades, most recently leading Berkshire Hathaway Energy.

Abel’s workload to date pushed him to the top. If BHE, one division of the $630 billion Berkshire Hathaway, were a stand-alone public company, it probably would be worth well over $50 billion, Barron’s reports.

That division includes subsidiaries focused on Midwestern and Western utilities. It includes coal, natural gas pipelines, hydroelectric, wind, solar, geothermal and nuclear energy in the mix. A $10 billion bet on liquefied natural gas emerged as recently as 2020.

Buffett, Abel and crew have backed the largest U.S. solar project .

Yet count Berkshire Hathaway as one of the companies most criticized by the influential Climate Action 100+ investor group. It leaned on metrics tied to emissions, governance and disclosures and considers Berkshire Hathaway in the close company of PetroChina /zigman2/quotes/205108732/composite PTR -1.83% , the listed arm of China’s state-owned energy interests, when it comes to lack of climate-change transparency.

Related: Global investors with $54 trillion tell companies pledging net zero emissions to show their work

Abel, for his part, has emphasized the spending on a renewables future.

“If you look at our investment through the end of 2020, we’ve invested $30 billion, or in excess of $30 billion, into renewables, and have really completely changed the way our businesses do business, i.e. our utility businesses,” he has said. “They have been decarbonizing and delivering a valued product to our stakeholders, to our customers.”

Buffett, whose vision still captures the imagination of investors, has no doubt embraced clean energy, but on a slower timeline. It’s a pace he has argued the size of the shift demands.

“Our country’s electric utilities need a massive makeover in which the ultimate costs will be staggering,” he said in the recent shareholder letter. “Historically, the coal-based generation of electricity that long prevailed was located close to huge centers of population. The best sites for the new world of wind and solar generation, however, are often in remote areas.”

And Buffett made clear in that letter that he sees the slower transition to renewables as the realistic path.

/zigman2/quotes/200060694/composite
US : U.S.: NYSE
$ 274.04
-4.65 -1.67%
Volume: 12.57M
June 18, 2021 4:03p
P/E Ratio
6.23
Dividend Yield
N/A
Market Cap
$626.85 billion
Rev. per Employee
$681,972
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/zigman2/quotes/208872451/composite
US : U.S.: NYSE
$ 412,729
-7,630 -1.82%
Volume: 1,903
June 18, 2021 4:05p
P/E Ratio
6.26
Dividend Yield
N/A
Market Cap
$626.85 billion
Rev. per Employee
$681,972
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/zigman2/quotes/205108732/composite
US : U.S.: NYSE
$ 44.64
-0.83 -1.83%
Volume: 330,194
June 18, 2021 4:00p
P/E Ratio
30.10
Dividend Yield
5.15%
Market Cap
$139.19 billion
Rev. per Employee
$719,296
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