After holding months of hearings and receiving reams of testimony, North Carolina regulators now face crunch time: Their plan for zeroing out Duke Energy’s carbon emissions by midcentury is due at the end of the year.
A mandate from a bipartisan state law adopted last fall, the Carbon Plan must be revisited in 2024 and every other year after that. That means most of the battle lines are drawn around what happens in the next two years, with Duke proposing natural gas plants to help replace its coal-fired ones, and an array of interests — including the clean energy industry, large electric customers, and the state attorney general — advocating a wait-and-see approach.
The seven-member panel tasked with crafting the blueprint is composed entirely of members appointed by Gov. Roy Cooper, a Democrat who helped draft last year’s law and has made climate action a priority.
As regulators’ decision nears, the Energy News Network is spotlighting some of the big ideas being debated as part of the Carbon Plan. Today, we look at the role advocates see for solar power, especially this decade.
‘The urgency of the moment we’re in’
A key flashpoint in the Carbon Plan proceeding is timing. The 2021 carbon law requires Duke to cut its carbon emissions 70% from 2005 levels by 2030 and nearly 100% by 2050 — targets consistent with international climate agreements and with what scientists say is necessary to avoid catastrophic climate change.
But the statute gives the commission leeway to stretch these deadlines, and both Duke and Public Staff, the state utility consumer advocate, believe that authority is relatively broad. While neither entity urges the commission to “authorize” a delay now, both of their proposed plans foreshadow such a request.
Duke wants acceptance for four different pathways to the 2050 deadline, but only one meets the 2030 mandate, with another achieving 70% reductions in 2032 and two reaching the benchmark in 2034. Public Staff recommends the commission plan around a portfolio that achieves 70% reductions in 2032.
An array of intervenors, however, argues these plans are premature at best and illegal at worst. The office of Democratic Attorney General Josh Stein, for instance, believes a two-year delay is only permissible if it brings more robust carbon reductions. “The Commission is required to develop a plan that commits to achieving 70% carbon emissions reductions by 2030,” Stein’s office wrote.
Others assert a deferral beyond two years is only allowed if the reliability of the system or a permitted offshore wind farm or nuclear facility is delayed. None of those “enumerated circumstances” have been established at this time, a coalition of clean energy advocates and businesses write in their Oct. 24 proposed order.
Competing legal interpretations aside, proponents for meeting the 2030 deadline say it would make little sense for the commission to plan for failure now. Plus, the sooner and deeper the pollution cuts, the more likely the planet will avoid a dangerous rise in temperature.
“Duke Energy’s current plan does not meet the urgency of the moment we’re in,” wrote Vickie Atkinson, one of hundreds who attended the public hearings this summer, in an email to commissioners. “We have no time to wait. It’s urgent. We’ve lost much. But there is still so much that we can save if we transition quickly.”
‘The single biggest step’
If the utility is going to meet the 2030 deadline, there’s little dispute that solar will have to play a big role.
The only Duke portfolio that cuts its emissions 70% by the end of the decade includes 5.4 gigawatts of new solar that year, at least 2.25 gigawatts more than its three other scenarios. Alternative plans from intervenors call for upward of 9.5 new gigawatts of solar in the same time frame.
“The single biggest step that Duke can do to save ratepayers money is to install more solar on its system,” said Tyler Norris, vice president for development at Cypress Creek Renewables, in written testimony to the commission. “This is because solar is by far the cheapest source of carbon-free energy available at scale in North Carolina in the next decade.”
Yet where solar energy’s potential is the greatest is in areas where it’s already most prolific. That means projects to rebuild and upgrade substations and transmission lines are needed to enable more of the resource to come online quickly. Duke, Public Staff, and many intervenors agree that at least a dozen such projects, mostly in southeastern North Carolina, should move forward now to make that happen, at a cost of roughly half a billion dollars. They’re hoping the commission will greenlight them this month when they rule on the Carbon Plan.
Still, even after these upgrades, everyone agrees Duke can’t physically add infinite amounts of solar to the grid each year. “We acknowledge there are interconnection constraints,” said David Rogers, southeast deputy regional director with the Sierra Club’s Beyond Coal campaign.
But that’s where the consensus ends. The Sierra Club and many others say the carbon law and the climate crisis demand ambition from Duke. Reaching the levels of solar required to meet the 2030 milestone means ramping up to at least 1,800 megawatts of solar connected per year, compared to an average of 520 megawatts connected annually since 2015.
Such upsurges are not just necessary, these groups argue, but quite possible. Past interconnection levels were influenced by policy that favored numerous small solar projects of 5 megawatts, they say, while the future will be dominated by exponentially larger ones. Plus, more proactive transmission planning will help prevent congestion.
“The only way to determine how rapidly Duke can add solar resources,” said Steve Levitas, a senior vice president at Pine Gate Renewables, “is to set ambitious goals and try to meet them.”
Proponents of this approach say there is little harm in procuring more solar energy than can ultimately be connected in a given year. Better to risk leaving some contracted projects on hold, the reasoning goes, than to foreclose meeting urgent and important climate deadlines. Plus, the threat to ratepayers is minimal.
“The only supposed disadvantage to setting larger initial procurement targets is the hypothetical” that solar costs will drop precipitously in the ensuing years, Norris testified on behalf of the Clean Power Suppliers Association, a consortium of the state’s largest solar developers. But, he continued, prices are expected to remain relatively steady between 2026 and 2032.
Duke and Public Staff propose much lower annual limits. In developing their portfolios, both constrained the amount of solar the computer modeling software could add each year, a move many said led to higher costs and less likelihood of meeting the 2030 deadline.
The attorney general, a coalition of big tech companies, the group of clean energy and environmental advocates represented by the Southern Environmental Law Center, and the Clean Power Suppliers Association all produced portfolios cutting carbon pollution 70% by 2030 at a lower cost than proposed by Duke, most with little or no new fossil fuel infrastructure.
In the near term, Public Staff proposes 2,859 megawatts procured in the next three years, an average of 953 megawatts per year. Duke has proffered a near-term action plan of procuring 3,100 megawatts. Both plans put the 2030 deadline impossibly out of reach.
“[Duke’s] proposed near-term amount means that an additional 2,300 MW of solar would need to be procured in 2029 in order to meet Duke’s P1 portfolio,” the attorney general’s office pointed out in its final recommendations to commissioners. “No party has argued that it is reasonable to assume that Duke can interconnect 2,300 MW of solar resources in 2029.”
A portentous commission ruling?
Though utilities commissioners have done little to tip their hands, a recent order could bode ill for solar advocates. With the close of the year rapidly approaching and 441 megawatts of solar still left to be procured under a 2017 clean energy law, the commission ruled last month that just 759 additional megawatts should be contracted this year — well under the limits the clean energy industry had sought.
In a statement, the Southern Environmental Law Center called the figure “disappointingly low when we need more solar energy, faster, to meet the 2030 target to reduce heat-trapping pollution set in bipartisan legislation signed by Governor Cooper.”
If the order reflects a broader decision to accept Duke’s annual limit on solar connections, Norris said in an email, “the commission … will have effectively given up on attempting to achieve our state’s decarbonization objective by 2030, and the cost and execution risk of achieving that objective by 2032 will increase significantly.”
Yet advocates found two main causes for hope in the ruling. For one, commissioners explicitly noted that they hadn’t necessarily ruled on the question of the annual cap, writing, “the Commission’s determination on this procurement will not be precedential, and the Commission will reexamine all aspects de novo prior to approving any subsequent procurements.”
Second, a partial dissent from Commissioner Dan Clodfelter, joined by Commissioner Jeff Hughes, showed sympathy for the clean energy industry position.
“It may be better to test the limits of existing systems and processes … and then develop solutions … while there is sufficient time to make corrections and adjust course,” Clodfelter wrote, “than confront the same tasks later in the process when we are approaching the legislatively mandated target deadlines for carbon reductions and have less time.”
Nick Jimenez, staff attorney for the Southern Environmental Law Center, said that reasoning aligned with his organization’s thinking: “It’s better to know about what the bottlenecks are sooner so we can get over them.”