North Carolina's Competing Visions For Cutting Power Plant Emissions
The future of North Carolina's energy system has been up for debate this week as state leaders discuss the best way to shift away from fossil fuels — and how fast to do it. With global temperatures rising and weather patterns changing, the question is an important one not just for North Carolina, but for the planet. But there's lots of disagreement. WFAE climate reporter David Boraks joins WFAE "All Things Considered" host Gwendolyn Glenn to talk about this week's legislative and administrative actions and what they could mean for the state's energy business.
Gwendolyn Glenn: Hello, David. So, what exactly is being debated?
David Boraks: With all the concern about climate change, the energy business is changing quickly worldwide. Here in North Carolina, there are really two competing visions for what future electricity generation should look like and when it should happen. And not surprisingly they fall along political lines, mostly.
First, there's the process playing out on the administrative side, at the state Environmental Management Commission and Department of Environmental Quality. That's where environmental groups are making their pitch for new regulations. On Tuesday, the commission voted to begin a rule-making process that would set limits on how much power plants can pollute. The vote was 9-3 in favor.
And second is the energy reform bill making its way through the General Assembly, which would spell out how utilities have to reduce emissions, but through new laws. The Republican-controlled House passed the bill by just eight votes after midnight Thursday morning (57-49), with five Republicans voting against it.
Glenn: Let's talk more about the bill that passed Thursday morning. What's in it?
Boraks: This legislation came out of a series of stakeholder meetings convened by Republican leaders and Duke Energy. They've drafted a bill that in some ways mirrors Duke Energy's own long-range plans. It calls for a smooth and gradual transition that includes closing five coal-fired plants and adding more gas-fired ones. Supporters of the bill say it wouldn't bring big price increases. House Speaker Tim Moore says it would "usher North Carolina into the future of energy."
The bill (HB 951) mentions the five plants by name, and they include the Allen plant in Gaston County, which would be replaced by a new battery storage system; and the Marshall plant on Lake Norman, where the legislature wants a new gas-fired plant.
Normally, decisions about plant closures and construction are a matter for the North Carolina Utilities Commission. Duke's latest long-range plans — submitted last September — have been discussed for months at the commission, including public hearings this spring. They faced questions from commissioners, and opposition from environmentalists and other Duke critics.
It's not unprecedented for the legislature to issue mandates. That's what happened in 2014 when lawmakers mandated the closures of coal ash dumps at four Duke Energy plants.
Glenn: You mentioned that the bill that passed Thursday morning was a close vote. What are opponents saying?
Boraks: Environmentalists and most Democrats want to see a faster shift away from fossil fuels. Of course, gas is cleaner than coal, but it's still a fossil fuel and environmentalists say adding more gas plants slows the transition to renewable energy. So they're not happy with the fact that this bill not only allows but requires Duke to build new gas-fired power plants.
And they're concerned about big rate hikes. Exactly what that means is in the eye of the beholder, of course, but one study suggests it could lead to prices 50% higher over a decade.
Gov. Roy Cooper doesn't like it. His spokesperson Ford Porter said it weakens the Utilities Commission’s ability to prevent big rate hikes and falls short on clean energy.
Many groups feel like they've been shut out of the stakeholder meetings to draft the bill. Here's Brooks Rainey Pearson of the Southern Environmental Law Center.
Pearson: Environmental groups and low- and moderate- income ratepayers were not part of that group. And a lot of legislators were left out who wanted to be part of the conversation.
Boraks: Another lobbyist I talked to called it a "sweetheart deal" for Duke Energy.
Glenn: So, David, what are businesses saying? Do they support the bill?
Boraks: Many were included in Republican meetings as the bill was being drafted. But for about the past month, some have started coming out against it. They're worried that the bill will lead to big rate increases and that it diminishes the power of regulators, who are supposed to be the ones looking out for customers. Textile manufactures last month wrote a letter against the bill. Big utility customers had a press conference a couple of weeks ago to oppose it.
And then on Wednesday morning, a coalition of businesses including Google, Pfizer, Smithfield Foods and big manufacturers came out against the bill — just as it was getting ready to come up for a committee vote. They said it improperly undermines the role of state regulators and fails to address other concerns they raised in stakeholder meetings.
Glenn: What does Duke Energy have to say about all this?
Boraks: Duke lobbyists have been hard at work behind the scenes trying to shape the energy reform bill. They have less sway when it comes to the Environmental Management Commission, whose members are appointed, not elected. A spokesperson did tell me this week that if the state adopts carbon limits and joins the Regional Greenhouse Gas Initiative, the company will go along with those changes in the energy system.
In a statement Thursday morning, Duke didn't directly comment on the House bill or the complaints about a secret process. It said only, "We remain committed to advocating for solutions that support communities and ensure the continued reliability and affordability customers expect."
Glenn: What are the next steps for the legislation? What happens now?
Boraks: The House bill now goes on to the Senate. People I've talked to aren't sure when it will come up. And it's not clear if it will be considered as-is, or whether the Senate will try to put its own spin on it.
And then there's that administrative process I mentioned. The Environmental Management Commission has a long way to go. They have to draft the rules and hold public hearings. So it could take well into 2022.
UPDATE: The energy reform bill approved in the House could tie the commission's hands. It says:
"Until such time as the General Assembly enacts legislation to authorize the State's participation in RGGI, and implementation of emissions limitations and cap and trade 49 requirements attendant with the RGGI program, the executive branch shall be prohibited from taking such action."