NORTH CAROLINA — The Utilities Commission approved a plan to guide energy investment in North Carolina over the next two decades ahead of schedule and amid the final days of the 2024 election. The order allows Duke to delay its mandated carbon reduction targets and advance a broad range of new energy projects.
READ MORE: Critics argue Duke’s carbon plan benefits shareholders above ratepayers
Duke is required to reach carbon neutrality by 2050 and reduce carbon dioxide emissions 70% below 2005 levels by 2030 under H.B. 951, a 2021 state law. The Utilities Commission made a final order on Duke’s proposed plan Friday after over a year of reviewing input from the utility, the public, and expert witnesses. It will allow Duke to delay its 2030 goal but orders it to “take all reasonable steps” to reach the target at “the earliest possible date.”
The approved carbon plan includes:
- 3,460 MW of solar to by 2031
- 1,100 MW of battery storage by 2031
- 1,200 MW of onshore wind by 2033
- 1,600 MW of new natural gas combustion turbine capacity by 2030
- 3,920 MW of new natural gas combined cycle capacity by 2031
- 1,834 MW of pumped storage hydro by 2034
- 600 MW of advanced nuclear by 2035
Duke described the order as a “constructive outcome” in a statement Sunday:
“The order confirms the importance of a diverse, ‘all of the above’ approach that is essential for long-term resource planning and helps us meet the energy needs of our region’s growing economy.”
The Southern Environmental Law Center and North Carolina Sustainable Energy Association served as intervenors in Utilities Commission hearings. Representatives of both groups praised the plan’s expansion of renewable energy; however, both expressed disappointment about delays in Duke’s carbon emission reduction goals, reliance on fossil fuels, and large investments in novel technologies with uncertain viability.
The Utilities Commission made its order days before the general election. The two gubernatorial candidates, Democrat Josh Stein and Republican Mark Robinson, promote starkly different approaches to state energy policy. Robinson supports increasing fossil fuel use and opposes the expansion of offshore wind; Stein’s office has repeatedly intervened in Utilities Commission proceedings to advocate increased investment in renewables and reduction of carbon emissions.
“While we appreciate that the Utilities Commission approved a plan that includes new solar and wind generation, we believe that Duke could and should be adding even more renewable energy on a faster timeline,” Department of Justice spokesperson Nazneen Ahmed told Port City Daily. “Our office will continue to push for a smarter, more affordable clean energy approach for North Carolina.”
Duke’s largest campaign expenditures in 2024 include $290,000 to GOPAC — a 527 organization that supports Republican political leaders — and $155,000 to the Republican State Leadership Committee. Last month, the RSLC announced Lt. Governor and gubernatorial candidate Mark Robinson would serve as the North Carolina chair of its Right Leaders Network. Duke has donated large sums to a separate 527 committee that launched an attack ad against Attorney General Stein in July.
Consultant Edward Burgess submitted a brief to the Utilities Commission on behalf of Stein in May criticizing Duke’s efforts to reduce emissions as insufficient.
Duke earns around 10% in guaranteed profit for capital invested in its projects. Burgess contended the incentive influenced the utility to delay its carbon reduction goal by prioritizing expensive new gas and nuclear infrastructure above cost-effective alternatives.
“Under rate-of-return regulation, there is an inherent tendency for investor-owned utilities (such as Duke) to increase the size of their investments in order to maximize profits,” Burgess wrote. “All else being equal, the more capital intensive a capacity resource is, the more attractive it should be to shareholders.”
Burgess cited Duke’s proposed buildout of small modular nuclear reactors as one example. Duke and the Utilities Commission have conceded SMRs are not a mature technology as there are no operational nuclear SMRs in the United States; energy firm NuScale canceled its SMR project in Utah last year due to repeated cost increases after spending $600 million in federal funds.
The Utilities Commission approved $440 million in early development costs for Duke’s proposed SMR nuclear facilities in its Friday order.
“We’re not anti SMR,” Mel Mackin, state policy leader of clean energy nonprofit Ceres, told Port City Daily. “But they’re not commercially viable quite yet. When you have resources that are economical and available, we definitely want to see policymakers, regulators and others prioritizing those resources.”
Mercy Investment Services, a member of Ceres’ investor network, is a Duke shareholder. The group submitted a 2020 shareholder resolution requesting full disclosure of Duke’s lobbying expenditures to ensure the company is using resources in the best interests of its investors. Mercy noted Duke reports trade association dues paid for by ratepayers but does not disclose the full range of its political spending.
Duke contributed $255,840 to the Nuclear Energy Institute — a nuclear industry association that supports SMRs — in 2023. Duke senior vice president Louis Renjel is a board member of the lobby group.
Mercy’s 2020 shareholder resolution argued Duke’s financial support for controversial groups that have opposed renewable investment, such as the American Legislative Exchange Council, could cause the company reputational damage. Lobbying disclosures show Duke paid $5,000 to sponsor 18 General Assembly members and staff for the American Legislative Exchange Council NC State Night dinner in July; the utility spent $2,500 sponsoring an ALEC NC State Night dinner in Arizona in November 2023.
Duke CEO Lynn Good is a former board member of the Edison Electric Institute, a group that coordinated with ALEC in a campaign against rooftop solar in 2014; EEI argued at the time rooftop solar was a threat to shareholder revenue. Duke contributed $576,158 to the Edison Electric Institute in 2023.
Duke’s 2024 shareholder proxy statement notes corporate governance director Ted Craver — who was chair of the Edison Electric Institute in 2014 — held year-round meetings with shareholders to discuss the utility’s capital plan. Craver is on the board of directors of Wells Fargo, the administrative agent for Duke’s credit agreements and a top investor in the Mountain Valley Pipeline. Duke has deemed the pipeline’s North Carolina expansion essential for fuel transportation in its natural gas buildout.
Duke CEO Lynn Good has been a board member of the Business Roundtable since 2013. The lobby group has pushed to remove smaller shareholders’ ability to make resolutions requesting company changes and pushed to expedite Mountain Valley Pipeline permit reviews. Duke contributed $84,000 to the Business Roundtable in 2023.
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