A New Bill Would Allow Duke Energy to Retreat From North Carolina’s Ambitious Climate Goals

State Sen. Paul Newton introduced Senate Bill 261 on Tuesday with the gusto of a car salesman: “I’m here to offer you an opportunity to save North Carolina billions of dollars,” the Cabarrus County Republican said as he convened a meeting of the Senate Agriculture, Energy and Environment Committee.

The savings, Newton said, would come from the elimination of Duke Energy’s interim carbon reduction goal: 70 percent by 2030 based on 2005 levels. The benchmark is enshrined in state law, and the utility has already said it can’t meet the requirement.

Last year, Duke Energy requested and received a four-year deadline extension from the N.C. Utilities Commission, which has the legal authority to grant it.

If the bill becomes law, Duke Energy could emit greater amounts of greenhouse gases by building more natural gas plants and relying on coal for longer. The utility also plans to build  small nuclear reactors. 

Newton, a former Duke Energy executive, called the interim goal for reducing emissions by 2030 “shortsighted” and “arbitrary,” and was “as sacrosanct as the ultimate goal” of carbon neutrality by 2050.

Under Newton’s bill, Duke’s date to hit carbon neutrality remains the same. By that time, though, federal climate scientists say continuing current levels of greenhouse gas emissions would lead to much more severe climate consequences, including the loss of up to $106 billion worth of coastal property nationwide due to accelerating sea level rise.

Sea levels will continue to rise, and sunny day flooding will be a daily occurrence by 2050, according to North Carolina’s Climate Risk Assessment and Resilience Plan. Other hallmarks of climate change—hotter days, stronger and more frequent hurricanes and floods, severe droughts and inland flooding—are all forecast to become more frequent and intense. 

Despite those climate trends, Newton said his bill, by extending Duke’s deadlines for emissions reductions, would ultimately save North Carolina ratepayers $4 billion—and that axing the interim goal would save $13 billion. He did not explain how those savings figures were calculated. 

The evidence, Newton said, is modeling conducted by the Public Staff of the Utilities Commission. However, few members of the legislative committee had seen the modeling, nor had it been made publicly available. Like Senate Bill 261, which was filed less than 18 hours before it went to committee, the process has been opaque.

“We should take a pause and see the modeling,” said state Sen. DeAndrea Salvador, a Democrat from Mecklenburg County. “This feels nebulous without something to see and react to.”

Nadia Luhr, manager of the electric section in the legal division of the Utilities Commission’s Public Staff, told Inside Climate News it modeled the costs by re-running Duke’s most recent energy portfolio, as detailed in the carbon plan, but without the interim goal, as requested by the General Assembly.

Overall, the modeling shows roughly $13 billion in savings by 2050. However, the public staff’s model does not reflect the substantial changes in the energy landscape that have occurred since Duke ran its model. This includes inflation, changes to federal grants and loans, tariffs, fuel prices and other variables, Luhr said.

The savings won’t be shared equitably. Modeling provided to Inside Climate News by the public staff shows that Duke Energy Progress customers, clustered in eastern North Carolina and in Asheville, would pay lower monthly rates in 2033 if the interim goal were eliminated; households in Duke Energy’s Carolina territory, in central and western areas of the state, on average would pay nearly the same, roughly $53 a month with the goals in place compared to $51 without.

The same trend holds for 2038, except Duke Energy Carolina ratepayers’ bills would average $10 more per month without the interim goal.

Duke plans to eventually merge the territories to eliminate the rate disparity.

The energy mix would also change if the interim goals are erased, the modeling shows. Through 2035, there would be no onshore or offshore wind and less solar and battery storage, yet more gigawatts of natural gas. Duke would also build small modular nuclear reactors.

Solar doesn’t meet original projections until 2042, and the pace of battery storage lags until 2050.

Newton co-sponsored the bill with two fellow Republicans, Sen. Lisa Barnes, who represents three counties northeast of Raleigh, and Senate Pro Tempore Phil Berger, whose Rockingham County district is the site of multiple existing and future natural gas pipelines.

“This seems risky,” said state Sen. Julie Mayfield, who represents Buncombe County, an area devastated by Hurricane Helene. “If you have a long-term goal, it’s responsible to set benchmarks in the middle.”

The bill would also allow Duke to charge ratepayers for construction costs while plants, including small modular nuclear reactors, are being built. The Utilities Commission would have to approve those charges.

Construction Work In Progress, as it’s known, has saddled ratepayers in other states with high energy bills. In Georgia, the Vogtle nuclear plant was seven years late and $17 billion over budget. In South Carolina, an expansion of the V.C. Summer nuclear plant never materialized; because of CWIP, ratepayers had to cover $2 billion in costs for reactors that never operated.

Duke Energy spokesman Garrett Poorman told Inside Climate News that as North Carolina continues to experience unprecedented growth, “we’re focused on making substantial investments in our critical infrastructure to ensure reliability and keep costs as low and predictable as possible for our customers. We are supportive of policies that enable us to meet the state’s growing energy needs, including those that advance efficient and always-on baseload generation resources.”

Newton downplayed the impacts on climate change that would occur if Duke doesn’t have to hit interim goals. “There’s not a scientist on the globe who will tell you the climate will be harmed” by extending the deadline and setting the goal at 2050, Newton said. 

In fact, scientists have issued increasingly urgent warnings that quicker action is needed to avert mass death and property loss from climate change. In a 2023 report by the Intergovernmental Panel on Climate Change, scientists said “every increment of warming results in rapidly escalating hazards. … Emissions should be decreasing by now and will need to be cut by almost half by 2030, if warming is to be limited to 1.5°C.”

North Carolina’s carbon emissions, Newton said, are dwarfed by those from China and India, which still rely heavily on coal plants.

While China’s greenhouse gas emissions are currently more than twice as high as those of the United States, China is rapidly deploying wind and solar energy, a stance sharply in contrast to that of the Trump administration, which strongly favors unfettered fossil fuel development. 

“Seventy percent does matter,” state Sen. Lisa Grafstein, a Wake County Democrat, said in response to Newton, referring to Duke’s interim goal of 70 percent greenhouse gas reductions by 2030. 

Duke’s original interim carbon reduction goals were included in 2021 legislation, House Bill 951, at the time lauded by many lawmakers as “historic,” in part because of the climate goals. That bill too, was crafted in secret by lawmakers, Duke Energy and business interests, then fast-tracked. After large manufacturers and environmental advocates pressured lawmakers, the bill’s pace slowed.

A stripped-down bill ultimately became law, although many consumer groups opposed it because of rate increases that could burden low-income households.

Newton’s remarks are similar to those he has made in the past to justify building more fossil fuel plants, particularly natural gas. In a public exchange with former Secretary of the Environment Elizabeth Biser, Newton said, “from a scientific perspective … North Carolina’s contribution to improving the climate is zero,” meaning that emissions reductions in North Carolina would have no impact if other nations around the world continued emitting greenhouse gases. 

Environmental advocates quickly denounced Senate Bill 261. “At a time of rising energy costs, this bill is a bad deal for ratepayers,” said Will Scott, director of Southeast climate and clean energy for the Environmental Defense Fund, in a prepared statement. “Let’s stick to our goals to reduce harmful power plant pollution and minimize customer exposure to volatile gas prices.”

In a press release, Dan Crawford, director of governmental relations for the N.C. League of Conservation Voters, called it a “dark day for North Carolina voters and ratepayers.”

Lobbyists and representatives for manufacturers and industrial customers supported the bill, citing cost savings from eliminating interim carbon reduction goals. “It reduces burdens by removing arbitrary dates, but still supports the basic goals,” Kevin Martin, CEO of the Carolina Utility Customers Association, told lawmakers during the public comment portion of the meeting. “It should allow an offramp for any [energy] source that threatens reliability.”

Of the eight people who publicly commented, only one person spoke against the bill—Calile DeThomas, who was desperate to reach her daughter in Asheville after Hurricane Helene razed swaths of western North Carolina last September. “I didn’t know if she was alive for two days,” DeThomas told state lawmakers this week.

A Realtor, DeThomas also owns property in Asheville that had been severely damaged. “I’d rather pay slightly higher rates than have property I can’t use for months,” DeThomas said. “I take climate change seriously.”

The bill moves to the Senate Rules and Operations Committee, which will hear it Wednesday.