More reliability coming for North Carolina power consumers

• The latest resource plan filed by Duke Energy reflects a rapidly changing energy environment in North Carolina
• The good news is that there will be much more reliable, baseload-capable natural gas and nuclear capacity added to the grid along with sensible delays to retiring some coal capacity
• Even so, the resource mix planned by 2040 would still be dominated by intermittent solar capacity and the four-hour battery storage needed to back it up, meaning ratepayers will still face heightened reliability risks and daunting costs

On Oct. 1, Duke Energy Carolinas and Duke Energy Progress (jointly, Duke) made its latest filing of the Carolinas Resource Plan with the North Carolina Utilities Commission (NCUC). The Carbon Plan law of 2022 (House Bill 951) requires biennial adjustments to the plan.

Since Duke’s previous filing in 2023, there have been several significant changes to the state’s energy landscape. They include:

Resource planning with more natural gas and without the interim goal

Duke’s filing is the first to preview North Carolina’s mix of generation resources after these changes, including especially the repeal of the interim goal. The John Locke Foundation’s “Power Plays” report discussed how that interim goal was having an outsized effect on resource planning, depressing natural gas and nuclear resources and greatly favoring solar and wind resources. Information presented to the General Assembly by the NCUC’s Public Staff showed that planning without the interim goal would save ratepayers $13 billion.

As anticipated here, SB 266’s repeal of the interim goal has resulted in planning for a greater amount of reliable capacity from natural gas and nuclear power plants. It also allows Duke to retain some coal resources longer. The importance of being able to retain coal facilities longer is not to be overlooked, either in terms of reliability or cost. During a summer heat wave this year, Duke Energy Carolinas obtained an emergency order from the U.S. Department of Energy to exceed emissions limits, which enabled it to increase its coal power generation 30 percent and thereby stave off power outages.

Prior to SB 266, North Carolinians were facing a perfect storm of electricity reliability and cost issues. A recent U.S. Department of Energy (DOE) report had predicted that, without any change to the status quo in resource planning, the risk for blackouts in North Carolina would be 27 times higher by 2030. Meanwhile, Locke’s 2024 report “Lighting the Path” showed there would be enormous costs in pursuing the path to carbon neutrality by 2050 using wind and solar as opposed to nuclear. Compared with the Nuclear Scenario, the Renewable Scenario would require eight times more new capacity, need nine times more new transmission lines, and take up more than one-fifth of the state’s land (7.7 million acres vs. just 15,190 acres for the Nuclear Scenario).

Solar’s greed for land is a pressing concern because of how much farmland North Carolina has been losing already from development. A report from the American Farmland Trust (AFT) ranked North Carolina second in the nation for threatened farmland from residential development.

Comparing the 2023 and 2025 Carolinas Resource Plans

The following table shows how Duke’s latest filing compares with its 2023 plan with respect to new generation:

2023 vs. 2025 Carolinas Resource Plan: New Generation Resources, Long-Term

Overall, the new filing would increase total planned new capacity by a net 4,400 megawatts (MW). That is after subtracting 6,600 MW of new wind and pumped storage hydro capacity. There would be increases of 400 MW in new solar capacity and 3,450 MW in additional battery storage. Planned new nuclear capacity would increase by 950 MW. The largest increase would be in new natural gas combined cycle (CC) and combustion turbine (CT) capacity — 4,100 MW and 1,100 MW, respectively.

That 40,100 MW new capacity would also be offset by the staggered retirement of 8,445 MW of baseload coal-fired generation capacity, while an additional 849 MW (the Cliffside unit 6 at Rogers Energy Complex) would be converted to natural gas–fired capacity by 2035.

2023 vs. 2025 Carolinas Resource Plan: Coal Capacity Retirements

The 2023 plan necessarily had a more aggressive retirement schedule of coal capacity than the new filing, owing to SB 266’s repeal of the interim goal. The new filing retires approximately the same coal capacity through 2034 as the 2023 plan, but then it delays retiring the final 2,220 MW for six years. So, while the 2023 plan would have shuttered all coal-fired generation by 2036, the 2025 plan would keep the last units (at Belews Creek Steam Station) open through 2040. A Duke press release explains that those units have dual-fuel capability (meaning they can also operate on natural gas).

Looming reliability and cost concerns from overbuilding solar facilities and battery arrays

The good news for North Carolinians from this filing is that there will be much more reliable, baseload-capable generation added to the grid than had previously been planned. The bad news is that the resource mix planned by 2040 would still be dominated by intermittent solar capacity and the four-hour battery storage needed to back it up.

Duke’s latest filing would have the state’s resource mix go from nearly 43,000 MW in 2026, with 11.4 percent of it being solar capacity and 0.2 percent batteries, to nearly 73,000 MW in 2040, with 25.8 percent being solar and 12.7 percent batteries. Total solar capacity would almost quadruple from more than 5,000 MW to about 20,000 MW. Battery arrays would mushroom from 92 MW to nearly 10,000 MW. In contrast, natural gas CC and CT and nuclear capacity would increase by a relatively modest 59 percent from almost 25,000 MW to 39,000 MW.

Unfortunately, this aspect of the filing means North Carolina would still face the heightened reliability risks warned about in the DOE report as well as daunting cost impacts warned about in the “Lighting the Path” report. It still means constructing lots of redundant intermittent capacity to approximate reliability (though none of it could generate power from early evening till mid-morning), having to build thousands of miles more of new transmission lines to connect it all, and taking over significant chunks of the state’s rapidly dwindling farmland, to boot.