The Duke Energy Carbon Plan hearings at the North Carolina Utilities Commission (NCUC) ended on August 5, 2024, and it is more clear than ever that Duke is unprepared to take the steps required to move away from its reliance on polluting resources.
Intervenors in the Carbon Plan docket include SACE, Sierra Club, and NRDC, represented by SELC, as well as the North Carolina Sustainable Energy Association (NCSEA), the Environmental Defense Fund (EDF), and NC WARN; environmental justice organizations represented by the Southern Coalition for Social Justice; Carolinas Clean Energy Business Association; business advocacy organizations; the electric cooperatives; the Attorney General’s Office and the Office of Public Staff; and offshore wind developers Avangrid and TotalEnergies. The number of intervenors indicates how high the stakes are as Duke retires its dirty coal fleet while concurrently facing increasing load growth – all while meeting the carbon reduction requirements established by the General Assembly in bipartisan House Bill 951: reduce carbon pollution 70% below 2005 levels by 2030 and achieve net zero by 2050.
It has become apparent that Duke has not moved quickly enough to meet the law’s requirements. And Duke appears stuck in old ways of thinking about fossil fuel resources. Proceedings in another docket revealed that the utility’s operations and maintenance spending has decreased through the years. Then Winter Storm Elliott happened, and Duke’s neglect likely contributed to the multi-faceted failure of multiple coal and fossil gas plants, resulting in rolling blackouts on Christmas Eve in 2022. Since that time, Duke has analyzed those reliability failures and made corrections and winterizations where it can, thereby making the generation fleet more reliable. But Duke is now asking the Commission to approve increasing its reserve margin from 17% to 22% – an astonishing 30% increase. The reserve margin is the excess capacity that Duke would need to build in order to avoid events like the Winter Storm Elliott failures. But one of the lessons from that massive load-shed event should have been that it is not just about the quantity of resources, but also the quality. Gas and coal plants experienced more forced outages and derates due to extreme cold weather than clean options like solar and pumped hydro storage.
So to restate: Duke reduced operations and maintenance and personnel at its power plants through the years – and then experienced an extreme reliability failure during Elliott – after which Duke stated that it made the appropriate winterization changes in response to Winter Storm Elliott and thereby making the generation fleet more reliable. But now Duke is asking for permission to overbuild the system even more, despite the reliability improvements made at their plants. It messed up, but it seems to want folks to forget that it messed up so that it will be able to use that one event as a reason to build (and earn a return on) a system that is bigger than is truly necessary.
One common feature of recent extreme cold weather outages around the country has been fuel availability – fossil gas was in short supply in recent winter storms, both during Winter Storm Elliott and during Texas’s Winter Storm Uri. In some instances, plant elements froze and failed, but in other instances, there wasn’t enough gas or pressure in the pipelines for the fossil gas plants to burn. Failures that occur at frozen gas wellheads and along the pipeline route will have a cascading effect the more that Duke relies on gas in the future. Duke’s analysis of reliability needs shows that it is not accounting for this kind of correlated outage risk, which has been a common feature in recent extreme winter weather events.
Will this gas-reliant system that Duke is asking for take full advantage of technologies that are:
No, not really.
There are some of those technologies, as well as new nuclear, in Duke’s proposed plan, but mostly they are asking for a lot of fossil gas plants. They are asking for fossil gas technology and nuclear technologies, also referred to as thermal resources, that Duke has considerable experience with. What became apparent during the hearing is that Duke Energy – one of the largest investor-owned utilities in the country – does not seem comfortable with the inverter-based non-combustion technologies, such as offshore wind, solar paired with storage, and virtual power plants, that are currently being deployed at scale by other utilities nationwide.
In Chattanooga, the municipal utility EPB is adding 36 MW of battery energy storage at two decommissioned substations, and they expect to have 150 MW of battery capacity in the near future. This seems like a small amount, but it represents 10-15% of the city’s highest peak demand for electricity. Like Duke, EPB was forced to implement rolling blackouts on Christmas Eve during Winter Storm Elliott in 2022. EPB buys electricity from TVA, which enforced the load reduction during that event. In the future, if TVA calls for a load reduction, EPB can call on battery storage rather than cutting off power to customers. This is a perfect example of battery storage providing resilience for an entire community. If EPB can do this in its 600-square mile Chattanooga service area, it is hard to understand Duke Energy’s hesitation in deploying batteries at scale. Duke dramatically reduced the amount of battery storage that its power-sector model was allowed to select in its supplemental modeling, and made clear that it will add storage very slowly so it can learn the technology incrementally. Somehow, storage integration does not seem to be a problem for EPB, or for Florida or Georgia or Texas or California or Massachusetts.
It is clear that Duke employees do everything in their power to achieve a reliable grid. The rolling blackouts associated with Winter Storm Elliott rightly prompted soul-searching from Duke. No one wants that to ever happen again. But instead of seeing that event as a wakeup call to deploy technologies that will help avoid a climate catastrophe, Duke has gone into its shell and is doubling-down on fossil fuels. Duke is asking the Commission to approve a plan to build gas plants that will lock North Carolina into an expensive, rigid, fossil gas dominated future. Meanwhile, the rest of the country races ahead in deploying solar and solar plus storage, onshore wind, offshore wind, aggregated behind-the-meter resources, and transmission to interconnect to regions where the wind and solar are abundant, cheap, and reliable.
In the future, when Duke has finally become comfortable with technologies long after everyone else, North Carolinians will be stuck paying for gas infrastructure that has by that point become irrelevant, polluted our communities, and contributed to the climate crisis along the way. The decisions made by the Commission in the next six months – whether to approve Duke’s plan, whether to approve the first of five combined cycle gas plants, whether to approve the first of many peaker combustion turbines – will determine whether North Carolina aggressively embraces the opportunities provided by non-combustion alternatives such as wind and solar and batteries and aggregated resources, or whether we stay tethered to climate pollution and fossil gas infrastructure.
Duke is stuck in the past, and it is asking the Commission to let it commit North Carolina to a rigid, expensive climate-destroying gas future. A clean energy future is here, and it’s time Duke got on board.
The post Duke Energy Leans In to Fossil Gas While the Rest of the Country Moves On appeared first on SACE | Southern Alliance for Clean Energy.
High Stakes Hearings Draw Multiple Intervenors
Intervenors in the Carbon Plan docket include SACE, Sierra Club, and NRDC, represented by SELC, as well as the North Carolina Sustainable Energy Association (NCSEA), the Environmental Defense Fund (EDF), and NC WARN; environmental justice organizations represented by the Southern Coalition for Social Justice; Carolinas Clean Energy Business Association; business advocacy organizations; the electric cooperatives; the Attorney General’s Office and the Office of Public Staff; and offshore wind developers Avangrid and TotalEnergies. The number of intervenors indicates how high the stakes are as Duke retires its dirty coal fleet while concurrently facing increasing load growth – all while meeting the carbon reduction requirements established by the General Assembly in bipartisan House Bill 951: reduce carbon pollution 70% below 2005 levels by 2030 and achieve net zero by 2050.
Duke Seeks a 30% Increase in Reserve Margin
It has become apparent that Duke has not moved quickly enough to meet the law’s requirements. And Duke appears stuck in old ways of thinking about fossil fuel resources. Proceedings in another docket revealed that the utility’s operations and maintenance spending has decreased through the years. Then Winter Storm Elliott happened, and Duke’s neglect likely contributed to the multi-faceted failure of multiple coal and fossil gas plants, resulting in rolling blackouts on Christmas Eve in 2022. Since that time, Duke has analyzed those reliability failures and made corrections and winterizations where it can, thereby making the generation fleet more reliable. But Duke is now asking the Commission to approve increasing its reserve margin from 17% to 22% – an astonishing 30% increase. The reserve margin is the excess capacity that Duke would need to build in order to avoid events like the Winter Storm Elliott failures. But one of the lessons from that massive load-shed event should have been that it is not just about the quantity of resources, but also the quality. Gas and coal plants experienced more forced outages and derates due to extreme cold weather than clean options like solar and pumped hydro storage.
Winter Storm Elliott Should Have Been a Wakeup Call
So to restate: Duke reduced operations and maintenance and personnel at its power plants through the years – and then experienced an extreme reliability failure during Elliott – after which Duke stated that it made the appropriate winterization changes in response to Winter Storm Elliott and thereby making the generation fleet more reliable. But now Duke is asking for permission to overbuild the system even more, despite the reliability improvements made at their plants. It messed up, but it seems to want folks to forget that it messed up so that it will be able to use that one event as a reason to build (and earn a return on) a system that is bigger than is truly necessary.
One common feature of recent extreme cold weather outages around the country has been fuel availability – fossil gas was in short supply in recent winter storms, both during Winter Storm Elliott and during Texas’s Winter Storm Uri. In some instances, plant elements froze and failed, but in other instances, there wasn’t enough gas or pressure in the pipelines for the fossil gas plants to burn. Failures that occur at frozen gas wellheads and along the pipeline route will have a cascading effect the more that Duke relies on gas in the future. Duke’s analysis of reliability needs shows that it is not accounting for this kind of correlated outage risk, which has been a common feature in recent extreme winter weather events.
Will this gas-reliant system that Duke is asking for take full advantage of technologies that are:
- free from fuel risks and costs, and
- widely deployed elsewhere – resources such as offshore wind, battery storage, solar paired with battery storage, and aggregated behind-the-meter resources?
No, not really.
There are some of those technologies, as well as new nuclear, in Duke’s proposed plan, but mostly they are asking for a lot of fossil gas plants. They are asking for fossil gas technology and nuclear technologies, also referred to as thermal resources, that Duke has considerable experience with. What became apparent during the hearing is that Duke Energy – one of the largest investor-owned utilities in the country – does not seem comfortable with the inverter-based non-combustion technologies, such as offshore wind, solar paired with storage, and virtual power plants, that are currently being deployed at scale by other utilities nationwide.
Battery Storage Can Provide Community Resilience
In Chattanooga, the municipal utility EPB is adding 36 MW of battery energy storage at two decommissioned substations, and they expect to have 150 MW of battery capacity in the near future. This seems like a small amount, but it represents 10-15% of the city’s highest peak demand for electricity. Like Duke, EPB was forced to implement rolling blackouts on Christmas Eve during Winter Storm Elliott in 2022. EPB buys electricity from TVA, which enforced the load reduction during that event. In the future, if TVA calls for a load reduction, EPB can call on battery storage rather than cutting off power to customers. This is a perfect example of battery storage providing resilience for an entire community. If EPB can do this in its 600-square mile Chattanooga service area, it is hard to understand Duke Energy’s hesitation in deploying batteries at scale. Duke dramatically reduced the amount of battery storage that its power-sector model was allowed to select in its supplemental modeling, and made clear that it will add storage very slowly so it can learn the technology incrementally. Somehow, storage integration does not seem to be a problem for EPB, or for Florida or Georgia or Texas or California or Massachusetts.
Stuck in the Past and Doubling Down on Fossil Gas
It is clear that Duke employees do everything in their power to achieve a reliable grid. The rolling blackouts associated with Winter Storm Elliott rightly prompted soul-searching from Duke. No one wants that to ever happen again. But instead of seeing that event as a wakeup call to deploy technologies that will help avoid a climate catastrophe, Duke has gone into its shell and is doubling-down on fossil fuels. Duke is asking the Commission to approve a plan to build gas plants that will lock North Carolina into an expensive, rigid, fossil gas dominated future. Meanwhile, the rest of the country races ahead in deploying solar and solar plus storage, onshore wind, offshore wind, aggregated behind-the-meter resources, and transmission to interconnect to regions where the wind and solar are abundant, cheap, and reliable.
In the future, when Duke has finally become comfortable with technologies long after everyone else, North Carolinians will be stuck paying for gas infrastructure that has by that point become irrelevant, polluted our communities, and contributed to the climate crisis along the way. The decisions made by the Commission in the next six months – whether to approve Duke’s plan, whether to approve the first of five combined cycle gas plants, whether to approve the first of many peaker combustion turbines – will determine whether North Carolina aggressively embraces the opportunities provided by non-combustion alternatives such as wind and solar and batteries and aggregated resources, or whether we stay tethered to climate pollution and fossil gas infrastructure.
Duke is stuck in the past, and it is asking the Commission to let it commit North Carolina to a rigid, expensive climate-destroying gas future. A clean energy future is here, and it’s time Duke got on board.
The post Duke Energy Leans In to Fossil Gas While the Rest of the Country Moves On appeared first on SACE | Southern Alliance for Clean Energy.