By Mark Oliver
Vice president of integrated system planning
Duke Energy serves more than 4 million electric customers in the Carolinas, and we consistently hear they share our vision for a cleaner energy future. We’ve already made incredible progress, retiring two-thirds of the coal plants in the Carolinas, and reducing emissions by more than 40% since 2005. Our goal is to continue this progress while keeping energy affordable and reliable.
In 2020, we took another significant step on this path by proactively engaging stakeholders on the development of our 15-year plan – also known as the Integrated Resource Plans (IRPs) – that lays out how to meet customers’ energy demands. Based on feedback from more than 200 diverse stakeholder groups, for the first time, these plans include a broad range of generation portfolio options to achieve varying levels of carbon reduction, including pathways to achieve up to 70% reduction of carbon emissions by 2030.
The plans present six possible generation pathways to provide regulators, policymakers and other stakeholders a broader view of carbon reduction pathways over the next 15 years, while seeking to balance the needs of customers and the current realities of our system and available technology.
Importantly, each portfolio keeps us on a trajectory to meet our near-term carbon reduction goal of at least 50% by 2030 and long-term goal of net-zero carbon output by 2050 in the Carolinas, while exploring faster coal retirement and the addition of more solar and storage.
Recently, anti-natural gas and anti-nuclear groups have criticized our energy plans and misrepresented the information that they contain. While we welcome and respect all opinions and perspectives, none of these parties carries the same responsibility we do to provide energy that’s reliable, affordable and available at all hours and in all seasons, while transitioning to a cleaner generation mix.
We want to be clear about our goals.
We share many of the same objectives, such as retiring our remaining coal plants early and bringing on more clean energy to replace coal.
Our energy transition must be equitable for all our customers, from residential customers struggling during the pandemic to manufacturers who need to stay competitive to customers wanting more clean energy. It’s important to recognize that both state lawmakers and utility regulators in the Carolinas require us to plan and operate a power system that provides electricity to our customers at the least possible cost, with due consideration of reliability and rate stability over a range of possible futures.
In the absence of a new federal carbon policy, we have been working within the current regulatory system to reduce carbon emissions by replacing older, less efficient coal units with cleaner burning, more flexible natural gas units for over two decades. These efforts have made us a national leader in carbon reduction and account for over 70% of our carbon reduction since 2005 in the Carolinas. And this improved system flexibility has enabled us to add solar at a much faster pace than most parts of the country.
Our plans include aggressively pursuing additional solar in the Carolinas and plan up to four times the current solar capacity over the next 15 years. And, for the first time, our plans include both onshore and offshore wind in the Carolinas as a viable power generation resource.
But in order to meet these goals, we must all acknowledge the unique system characteristics in the Carolinas that require some type of reliable dispatchable energy source to fill the gap when solar and storage can’t keep up with customer demand, like during a long stretch of cold winter days as recently experienced in Texas. Natural gas and nuclear power are cleaner energy generation sources that will provide a critical bridge between coal and our plan for net-zero carbon emissions by 2050.
We believe there’s a way to add some new natural gas plants to meet the near-term energy needs of our growing customer base, while executing on our long-term affordability and carbon goals – recognizing that the role of these resources will change significantly over time, ultimately serving as a backup to weather-dependent renewable generation. Installing plants that are hydrogen-compatible is one way to achieve that kind of versatility. And, as the costs of renewables are projected to continue to fall, thoughtfully pacing this transition will be key so our customers can benefit from these savings in future years.
We included a “no new gas” option in our plans to provide stakeholders a better understanding of what that would entail. The idea sounds simple, but there are several challenges:
- It is the most expensive option for our residential, commercial and industrial customers.
- It delays the retirement of coal units that emit the most carbon.
- It threatens the reliability and affordability of our power supply by relying more heavily on the development of new energy storage technology.
While it is an option the Carolinas may choose to pursue, customers, regulators, policymakers and other stakeholders need to understand fully the cost, environmental and reliability challenges and trade-offs the “no new gas” option presents.
We are proud the Carolinas are national leaders for carbon emissions reduction in the electric sector – while maintaining some of the lowest energy prices in the country – and we’re eager to build on and accelerate that success. We conducted this extensive analysis to provide a comprehensive, transparent view of the costs and benefits associated with options for further carbon reductions. We intended for our plans to provide more detail than ever before to help inform customers, regulators, policymakers and other stakeholders about those very important energy policy conversations.
We will continue to work and collaborate to find the best fit for the Carolinas and the citizens and businesses we serve.