Tell the NCUC: Don’t make customers pay for Duke Energy’s negligence.
(Please include E-7 Sub 1214 in the subject line)
Billions in grid scheme and unapproved gas expansions among the challenges
As a long-awaited hearing begins next Monday, attorneys for NC WARN and allies will firmly oppose Duke Energy’s request for yet another electricity rate hike even as the Utilities Commission’s Public Staff and other parties recently announced settlements with Duke on portions of the rate request. Duke has proposed no changes in its customer-gouging, grid “modernization” scheme – which most parties initially opposed – and it’s steaming ahead with construction of large amounts of unapproved gas-fired generation even as dozens of more efficient Duke gas units sit totally idle.
The long-stalled rate cases by Duke Energy’s two Carolinas entities has been partially combined in an evidentiary hearing process likely to last two weeks or longer.
Veteran engineer Bill Powers, an NC WARN consultant, showed in pre-filed written testimony that Duke Energy is trying to pad investors’ pockets through pre-approval of $2.3 billion in grid projects that are either unneeded or could be better handled with solar-plus-storage investments. The proposed “grid modernization” plan – which Duke has proposed to increase to at least $13 billion – has repeatedly failed to gain regulatory, legislative or public support since 2016.
In addition, Powers shows that Duke has been quietly building new gas-burning capacity at existing coal-fired power plants – without approval or scrutiny – in a way that maximizes both greenhouse gas emissions and the cost of the electricity.
The unapproved gas construction, for which Duke is seeking $278 million in this rate case alone, is the subject of a broader challenge filed recently with the Utilities Commission by NC WARN, the Center for Biological Diversity and Appalachian Voices. The groups say Duke Energy Carolinas is adding high-dollar, climate-wrecking gas capacity to justify keeping coal plants open even though one-third of the utility’s total generation fleet sat idle during the days of highest power usage in 2019 (pp. 13-14).
The excess capacity shows that several of Duke Energy’s coal plants should be shut down permanently instead of spending hundreds of millions modifying them to burn gas as an excuse to keep them open. Other points in our opposition to Duke’s rate hike include:
- Duke Energy told investors that a primary objective of the grid plan is to increase shareholder value (p. 129) by accelerating the tempo of capital projects.
- Duke Energy’s filings are tantamount to seeking pre-approval of future grid investments, a major change in state law that NC WARN is opposing.
- Duke provides little support for its claims that the billions in grid spending would benefit customers. Engineer Powers testifies that large amounts of rooftop solar could be added to Duke’s system with little or no grid enhancement.
- A recent study for the California Public Utilities Commission (and applicable to NC) finds that “the addition of battery storage with rooftop solar would negate the need for progressively more expensive grid optimization upgrades … battery storage is projected to rapidly become a standard industry practice.”
- There is a large amount of cheaper hydro and gas-fired capacity adjacent to Duke territory that could be used instead of building more gas generation.
- Duke should not recover millions from customers – plus profit – for its coal ash negligence.
In this rate case, Duke Energy once again claims it wants to prepare the power grid for a future of distributed renewable energy (at homes, buildings, parking areas, etc.). However, Duke’s own 15-year plan shows that the corporation will increase renewables to only 8 percent of its total generation in the Carolinas while building some 60 gas-fired units.
Advances in renewables, paired with battery storage, are set to leapfrog all that grid expense, and it’s a faster, cheaper and better way to get to a distributed and more resilient energy system. We should be equipping buildings and homes with solar-plus-storage instead of pouring billions into a gas system that is moving toward obsolescence and an electric grid that will soon need very different kinds of improvements than those proposed by Duke.
As NC Department of Environmental Quality Secretary Michael Regan said in his statement last week on his agency’s denial of a water quality permit for the Mountain Valley Pipeline – Southgate: “North Carolina’s clean energy future is not dependent on adding more natural gas infrastructure. Projects like this slow down the state’s goal to reduce greenhouse gases … We should invest in clean, renewable energy sources and the economic benefits of energy innovation.”
See coverage by WFAE