NC energy regulators face a choice with Duke carbon-cutting plan: How fast and how far to go?
State regulators face a year-end deadline to decide how Duke Energy will eliminate carbon emissions at power plants to meet the state's climate goals. After a year of debate, the North Carolina Utilities Commission is expected to issue an order next week.
Power plants are the state's second-largest source of the heat-trapping pollutants that cause global warming. Last year, legislative Republicans and Democratic Gov. Roy Cooper agreed on a compromise energy reform law to address the problem. But it left the details to the North Carolina Utilities Commission, which has spent 2022 gathering ideas and concerns through filings and public hearings.
North Carolina's 2021 legislation wrote the state's climate goals into law - something that only about one-third of the states have done. For most, 100% clean energy is still just a goal spelled out in roadmaps and action plans. But some states, including North Carolina, Washington and Connecticut, are using regulatory processes to draw up rules to meet those goals.
In May, Duke Energy submitted its proposed carbon plan — actually four plans that offer different routes to eliminate and replace coal-fired power plants. Duke supplies most of North Carolina's electricity. Glen Snider, who oversees resource planning for the company, said at the time: "You're fundamentally transforming the energy system in a way that I think is good for customers."
Duke’s plans call for building new natural gas-fired plants that also could burn hydrogen and a new generation of small nuclear plants, as well as solar and wind energy and battery storage.
But business, environmental and consumer groups disagree with Duke's plans — especially all those new natural gas plants, which still produce heat-trapping pollutants.
"What we don't want to see in the plan is, you know, reliance on new builds of natural gas-burning facilities, and sort of hand-wavy technologies like green hydrogen, so called, or small modular nuclear reactors," said Will Scott, Southeast Clean Energy Director for the Environmental Defense Fund.
Instead, he and other Duke critics want the company to shift faster to renewable energy to help avoid the worst effects of global warming.
"We want to rely on the known least-cost clean resources that we've got — wind, solar and storage — and just be ambitious about how we build those out and modify the grid to support them," Scott said.
"Least-cost" is actually a requirement of last year's energy reform law. Duke says its plans could push energy prices up as much as 35% over the next 13 years.
Duke and its critics have spent most of the year debating Duke's plan. Some groups, as well as Attorney General Josh Stein, have offered their own plans, which they say would cost less and shift more quickly to renewable energy and battery storage.
"We have an opportunity to create a plan that is not only better at reducing carbon emissions, and therefore better for the climate, but it's actually cheaper for ratepayers," Stein argued in September.
Will Duke make the 2030 target?
Along with cost, another goal is eliminating climate pollution. The law calls for cutting greenhouse gas emissions from electricity generation by 70% from 2005 levels by 2030 and reaching net zero by 2050. Only one of Duke's scenarios would meet the 2030 target, while the other three would take two to four years longer.
The law does allow some leeway, if for example, a nuclear plant takes longer than expected to build. And a Duke spokesman said delaying the goal could also lower costs, because new technologies are expected to become cheaper in the coming years.
But Scott said, "We don't think at this point we should plan to miss the 2030 target in 2022."
Local governments and businesses, including Walmart, Google and Apple, also worry that Duke's natural gas-reliant plans would keep them from hitting their own climate goals.
Regulators are now down to the wire for issuing an order that sets Duke's course through 2030 and beyond. The question is whether they will adopt one of Duke's scenarios or cook up a plan of their own that draws on proposals from Stein and others.
Duke Energy spokesman Bill Norton said the company hopes the commission will adopt its recommendations.
"At the end of the day, we've actually got the same goal as all the intervenors, which is an efficient, clean energy transition," he said. "Our focus is making sure that we do that in a way that is the most affordable manner possible without sacrificing customer reliability."
The utilities commission's deadline is expected to issue an order by next Friday, Dec. 30. And the law requires regulators to revisit the plan every two years.