Expect delays? The state's landmark climate targets face challenges from Duke. - Greensboro News & Record

Expect delays? The state's landmark climate targets face challenges from Duke.

North Carolina’s policy targets for carbon emission reduction are expected to face challenges as Duke Energy seeks to postpone its originally proposed goal by five years.

While the precise environmental impact of the delay remains uncertain, experts caution that it could undermine North Carolina’s policy targets to reduce carbon emissions and hinder progress toward combating climate change.

In its newly proposed plan submitted to the Utilities Commission last month, Duke Energy unveiled a strategy aimed at addressing a projected surge in electricity demand while navigating mandates to lower carbon emissions from the state. Central to this plan is using natural gas plants capable of running on hydrogen, as well as incorporating more solar power and electricity storage in batteries.

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As Duke Energy offers three options that would respectively meet the 70% reduction target by 2030, 2033, and 2035, the U.S. utility giant describes the 2035 plan as “the most reasonable, least cost, and least risk portfolio” among the three.

“Duke is continually trying to delay implementation of meeting those goals in order to invest more heavily in technologies like natural gas and small modular reactors, which are not necessarily commercially viable at this moment,” said Matt Abele, executive director of NC Sustainable Energy Association. “We should be accelerating emissions reductions instead of further delaying in place of hopes of deploying technologies further down the road, like SMRs (Small Modular Reactors), and hydrogen.”

Dragging down government’s policy targets

The debate over Duke Energy’s proposed plan underscores the challenges and complexities involved in balancing the immediate need to reduce carbon emissions with the long-term transition to cleaner energy sources.

North Carolina’s landmark legislation — House Bill 951 — enacted in 2021, stands as a pivotal driver in the state’s efforts to combat climate change. The law mandates a substantial reduction of carbon dioxide emissions by 70% by 2030, compared to 2005 levels, reflecting state officials’ commitment to transitioning toward a cleaner, more sustainable energy future.

“The argument is largely about timing and speed. If the question is: is it going to make a difference getting to 70% reduction by 2035, as opposed to 2030? That’s a very hard question to answer, because it depends on the context and in the context of total global emissions,” said Stan Meiburg, executive director of Sabin Family Center for Environment and Sustainability at Wake Forest University.

“And it’s important that we continue to make progress, even if we can’t get there as fast as we would like. If your question is, ‘is (Duke Energy) really doing everything they can to meet the target faster?’ — that’s another question.”

Duke Energy claims to prioritize its customers by emphasizing the need to consider the economic implications and affordability for consumers in its plan, while favoring the 2035 option as the most customer-friendly approach.

“Attaining 70% carbon reduction by 2030 has significant cost and execution risks for customers,” Bill Norton, spokesperson for Duke Energy said. “Conversely, targeting 70% reduction by 2035 — which is still ambitious considering the Carolinas’ load growth — would maintain reliability while saving customers $6 billion over the 2033 portfolio and $34 billion over the 2030 portfolio.”

Duke Energy’s filings from last August indicate that the most ambitious option, targeting the 70% reduction by 2030, would potentially raise an average residential customer’s monthly bill by $60 by 2033 and $70 by 2038. Achieving the same reduction goal by 2035, according to the company, would lead to a comparatively lower increase, with bills projected to rise by $35 by 2033 and $55 by 2038.

“We believe faster is not better for our customers — the potential impacts are increased costs and potentially reduced reliability, with no difference in the final outcome of carbon neutrality by 2050. Of course, evaluating that balance of cost and reliability versus benefit is ultimately up to the NC Utilities Commission,” Norton added.

With Duke’s proposed plan now in the hands of regulators, their decisions will not only shape the trajectory of Duke’s proposal but also determine the state’s ability to effectively meet its climate goals in the years ahead.

The HB951 law offers flexibility, allowing the state Utilities Commission to potentially extend the deadline beyond 2030 under specific circumstances, such as ensuring the stability of the electric grid or upon approval of certain nuclear and wind-generation projects. This legal framework sets the stage for the ongoing debate over Duke Energy’s proposed timeline adjustments, with stakeholders weighing the imperative to meet emission reduction targets against the practical considerations of energy supply and technological advancements.

The Public Staff of NC Utilities Commission, a state agency representing customer interests in proceedings before the North Carolina Utilities Commission, is set to provide its evaluation of the plan by May 28. Following the evaluation, the Utilities Commission is scheduled to begin a public hearing on July 22 across the state to hear from the public and intervening parties about Duke’s proposal. The Commission won’t reach a decision until after those hearings are concluded, sometime later this year.

James McLawhorn, director of Energy Division of the Public Staff, has confirmed to the Journal that the agency is currently evaluating Duke’s amended proposal.

Uncertainty remains

Duke Energy’s latest proposal aligns with its previous public statements addressing environmental concerns, as the company navigates a landscape increasingly shaped by heightened climate awareness.

Experts have noted the company’s plan to retire its coal-fired fleet by 2035 and the inclusion of renewable energy sources such as solar power and offshore wind production off the North Carolina coast align with broader efforts to diversifying energy portfolios and mitigate carbon emissions.

Nonetheless, despite these initiatives, skepticism looms over the feasibility of certain technological solutions within Duke Energy’s plan, such as the company’s reliance on natural gas, as well as on emerging technologies like hydrogen, given their current lack of commercial viability.

“Duke is relying upon technologies that currently are not technically feasible and have yet to even come close to demonstrating commercial viability. When they put forward things like Small Modular Reactors (SMRs) and carbon capture (and argue) ‘we’re going to build a natural gas plant, put carbon capture on it,’ they’re selling us, essentially, something that doesn’t exist,” said John Morrison, executive director of NC Clean Future at Catawba College Center for the Environment.

The company’s pursuit of hydrogen gas, while promising in theory for its potential to generate zero emissions when burned, faces significant hurdles due to the lack of commercially viable technology for large-scale production. Challenges such as costly access to infrastructure impede its widespread adoption, limiting the realization of its environmental benefits, according to International Energy Agency.

Meanwhile, natural gas, predominantly composed of methane, poses significant environmental challenges due to its potent greenhouse gas properties, says U.S. Energy Information Administration.

As stakeholders assess the merits of Duke’s proposal, the tension between environmental aspirations and technological realities underscores the challenges inherent in transitioning toward a greener energy future.

However, as pointed out by Brian Murray, interim director of Nicholas Institute for Energy, Environment and Sustainability at Duke University, the absence of comprehensive modeling to assess the implications of Duke Energy’s proposed delay makes it difficult to accurately predict the impact of the revised plan on the state’s air pollutants.

Duke Energy has confirmed with the Journal that it has not modeled how the company hitting 70% carbon emission reduction by 2035 would impact the state’s overall goal of decarbonization across all sectors.

“Everyone needs to meet their policy goals. And this is North Carolina doing its part … discernible effect on North Carolina is going to be more affected by what the rest of the country does and what the rest of the world does. I see greenhouse gases that go into the atmosphere from all over the world. And the concentrations are global concentrations, not local concentrations,” Murray said.

“This is what people call a collective action problem. Everyone has to act to lower the global concentrations, including North Carolina.”