Utility commissions review Duke Energy plans for ongoing carbon reductions in Carolinas

Published on March 25, 2021 by Kim Riley


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Duke Energy Corp., which is currently going through the regulatory processes in both North Carolina and South Carolina seeking approval of its 2020 Integrated Resource Plans (IRPs), recently reiterated its goals in the two states to further hasten carbon emission reductions there.

“We intended for our plans to provide more detail than ever before to help inform customers, regulators, policymakers, and other stakeholders about those very important energy policy conversations,” said Mark Oliver, vice president of integrated system planning at Duke Energy. “We will continue to work and collaborate to find the best fit for the Carolinas and the citizens and businesses we serve.”

The investor-owned utility, which serves more than 4 million electric customers in North Carolina and South Carolina, last year engaged more than 200 external stakeholder participants representing a broad range of interests, including business customers and consumer advocacy and environmental groups, to solicit input toward informing the IRP process. Duke received recommendations regarding resource planning, carbon reduction, energy efficiency, and demand response.

“I appreciated the opportunity for more substantive engagement with Duke Energy, and I highly encourage company leaders to continue involving stakeholders early in key strategic decisions,” said David Rogers, southeast deputy regional director for the Beyond Coal Campaign of the Sierra Club, following release of Duke’s IRPs last September.

According to Duke Energy, the IRPs are used for planning purposes as it looks at generation to meet customer needs over the next 15 years. The IRP is updated every odd year, and the company files a new comprehensive report every even year. Then, the IRPs must go through a regulatory review process in which both the North Carolina Utilities Commission (NCUC) and the South Carolina Public Service Commission (SCPCS) ultimately will make the final approval.

Duke is currently going through these regulatory reviews in both states and at the same time has drawn criticism from some corporations and local governments, as well as legal action from two climate justice groups, all basically charging that the utility proposes to create too many new gas plants and has released plans that don’t go far enough toward supporting renewable energy sources.

“Recently, anti-natural gas and anti-nuclear groups have criticized our energy plans and misrepresented the information that they contain,” Oliver said. “While we welcome and respect all opinions and perspectives, none of these parties carries the same responsibility we do to provide energy that’s reliable, affordable and available at all hours and in all seasons, while transitioning to a cleaner generation mix. We want to be clear about our goals.”

While Duke Energy shares many of their objectives, such as retiring its remaining coal plants early and bringing on more clean energy to replace coal, Oliver said that in order to meet them, regulators and critics alike should consider “the unique system characteristics in the Carolinas that require some type of reliable dispatchable energy source to fill the gap when solar and storage can’t keep up with customer demand.”

Therefore, the IRPs now under review by the NCUC and SCPSC lay out how Duke Energy will meet customers’ energy demands, he said, and they include a broad range of generation portfolio options to achieve varying levels of carbon reduction, including pathways to achieve up to 70 percent reduction of carbon emissions by 2030.

In total, the plans present six possible generation pathways for Duke Energy to reduce carbon over the next 15 years as it also works to balance the needs of customers, the current realities of its system, and available technology, Oliver said.

“Our plans include aggressively pursuing additional solar in the Carolinas and plan up to four times the current solar capacity over the next 15 years,” he added. “And, for the first time, our plans include both onshore and offshore wind in the Carolinas as a viable power generation resource.”

The IRPs each keep Duke on a trajectory to meet its near-term carbon reduction goal of at least 50 percent by 2030 and long-term goal of net-zero carbon output by 2050 in the Carolinas, said Oliver.

Duke Energy also thinks there’s a way to add some new natural gas plants to meet the near-term energy needs of its growing customer base as it executes its long-term affordability and carbon goals, and in its IRPs has included a “no new gas” option to provide stakeholders a better understanding of what that would entail.

However, Oliver pointed out that such an option does present some challenges:

1. It is the most expensive option for Duke’s residential, commercial and industrial customers.
2. It delays the retirement of coal units that emit the most carbon.
3. It threatens the reliability and affordability of Duke’s power supply by relying more heavily on the development of new energy storage technology.

“While it is an option the Carolinas may choose to pursue,” said Oliver, “customers, regulators, policymakers, and other stakeholders need to understand fully the cost, environmental and reliability challenges and trade-offs the no-new-gas option presents.”

Thus far, Duke Energy already has made “incredible progress” retiring two-thirds of its coal plants in the Carolinas and reducing emissions by more than 40 percent since 2005, he said.

And in the absence of a new federal carbon policy, Oliver pointed out that Duke Energy has been working within the current regulatory system to reduce carbon emissions by replacing older, less efficient coal units with cleaner burning, more flexible natural gas units for over 20 years.

“We are proud the Carolinas are national leaders for carbon emissions reduction in the electric sector and we’re eager to build on and accelerate that success,” said Oliver.