Duke Energy provides glimpse of its carbon plan at state energy conference
Duke Energy’s first draft carbon plan will feature some options that delay the utility’s state-mandated emissions reduction until 2032 or 2034 in order to build offshore wind farms or small modular nuclear reactors, a company official said this week.
Duke will file the plan with the N.C. Utilities Commission on May 16, showing how the company plans to reach a 70% reduction from 2005 levels by 2030 and net zero by 2050.
But House Bill 951, signed into law last year, gave the Utilities Commission some flexibility around the 2030 goal, allowing it to postpone the target by up to two years if waiting allows the utility to achieve deeper cuts in emissions. The target can be delayed further if Duke is pursuing large, complex projects like wind farms or nuclear reactors. Duke Energy Vice President of Regulatory Affairs and Policy Kendal Bowman indicated this week that the utility is considering those possibilities.
Bowman spoke Tuesday at the State Energy Conference of North Carolina, hosted by the N.C. Clean Energy Technology Center.
Some of the scenarios Duke puts forward, Bowman said, will show it reaching a 70% reduction from 2005 levels by 2030 with “no exceptions.” Others would utilize the flexibility built into last year’s comprehensive energy legislation.
Duke’s filing will also include information about how much each scenario could cost, Bowman said. That is a nod to the requirement that the approved plan be the most affordable option that also meets the goals, as well as to concerns from consumer advocates that House Bill 951 failed to protect customers who earn lower incomes.
House Bill 951 requires the Utilities Commission to consider cost in charting a path forward, as well as affordability and reliability.
Bowman noted that the company has already cut emissions more than 40% from 2005 levels. That has largely been accomplished through the retirement of coal-fired power plants across North Carolina.
“We’ve got to reduce our emissions 16 million tons between now and 2030 to hit that carbon reduction goal. So how are we going to do that?” Bowman said.
Duke will use a three-pronged approach, Bowman said. That will include reducing demand by using programs such as incentives that feature lower costs at low-demand times of day and adding carbon-free resources like wind and solar.
The company hopes to keep the state’s power reliable, Bowman said, by adding energy storage and potentially natural gas-fired power plants.
Duke’s use of natural gas to shift away from coal-fired power has drawn the ire of environmental groups and some climate scientists. Opponents say using gas as a power source leads to higher emissions of methane, a greenhouse gas that lasts in the atmosphere for a shorter period than carbon dioxide but is drastically more potent while present.
The company has held three virtual stakeholder events explaining its thinking about different parts of the carbon plan and soliciting feedback. Once the plan is filed, the Utilities Commission plans to host a series of public hearings across North Carolina.
The lowest cost provision in House Bill 951 is crucial, said Chris Ayers, the executive director of North Carolina’s Public Staff, an independent state agency that represents customers before the Utilities Commission.
Right now, Ayers said, there is broad public support for a transition to low- and no-carbon energy sources. But that could change quickly if people see their bills increase and don’t understand why it’s happening.
“We’ve got to be very thoughtful in determining how we plan our path to 2030 to ensure that it is a least-cost approach because to the extent that costs get out of control, you will begin to see an erosion of public support for the energy transition,” Ayers said.
This story was produced with financial support from 1Earth Fund, in partnership with Journalism Funding Partners, as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work.
This story was originally published April 29, 2022 at 5:45 AM with the headline "Duke Energy provides glimpse of its carbon plan at state energy conference."