Duke Energy plans would cut CO2 and add renewables — but at a price
Duke Energy filed plans with North Carolina regulators Monday for reducing and eventually eliminating carbon emissions from its power plants to meet state climate goals. The Charlotte-based utility offered four scenarios that would eliminate coal-fired power plants and add new gas, nuclear and renewable energy.
Last year's state energy reform law called for cutting greenhouse gas emissions from electricity generation by 70% from 2005 levels by 2030 and reaching net-zero carbon by 2050.
Duke Energy's filing at the North Carolina Utilities Commission includes one scenario for achieving that 2030 goal and three scenarios that would take two to four years longer because they use new technologies — small nuclear reactors and offshore wind power.
All the plans would close Duke Energy's remaining coal-fired plants by 2035 and add new gas-fired plants, solar and wind farms and battery storage. By 2050, Duke Energy also plans to be burning clean hydrogen.
"You're fundamentally transforming the energy system in a way that I think is good for customers," said Glen Snider, who oversees resource planning in the Carolinas for Duke Energy. He said Monday the plan offers customers "options to control their energy bill, and they're getting a modernized energy system that has a much lower carbon footprint using much more advanced technology than was around a decade or two ago and so."
All this comes at a price. The various plans would require annual rate increases averaging 1.9% to 2.7% over the next 13 years. Duke Energy's Kendal Bowman said even without the carbon goals, prices would rise.
"We would still need to be investing in the system and bringing on more resources," Bowman said. "Coal, in and of itself, the supply is starting to become more scarce and more expensive to operate."
Environmental groups are concerned about the plan's continued reliance on gas-fired plants and about the potential delays in meeting the 2030 goal.
Ultimately, carbon reduction measures will be decided by the utilities commission. Last year's energy reform law, does give regulators some wiggle room on those 2030 goals if they include emerging technologies still in development — namely small modular nuclear reactors and offshore wind.
"Of course, science tells us that we need to be cutting carbon as quickly and deeply as possible to avoid the worst effects of climate change," said Gudrun Thompson, a senior attorney with the Southern Environmental Law Center. The SELC represents environmental groups including the Natural Resources Defense Council, Southern Alliance for Clean Energy and the Sierra Club.
"So every year of further delay in meeting the law's targets means carbon being emitted into the atmosphere that we can't afford to put there," Thompson said.
Electric utilities are the state's second-largest source of carbon emissions that cause global warming, after transportation.
Duke Energy officials have said repeatedly that they don't have a preference among their four scenarios. But state law requires regulators to choose the "least-cost alternative" to meet the state's climate goals. And Thompson noted that of the four scenarios, Option 3 has the lowest long-term costs, with projected rate hikes of 1.9% a year.
State regulators will hold public hearings in July and must approve a final plan by year's end.