Duke’s proposed Carbon Plan relies on tall tales

In a well-known fairy tale you may remember from childhood, swindlers convince an emperor to wear invisible clothing. Certain he’s donned an impeccable garment, the emperor proudly struts through town— not realizing, of course, that he’s wearing nothing at all. Like many fairy tales, the story delivers a warning, cautioning us not to let an elaborate ruse or empty promise override reality.  

North Carolinians might be reminded of that story now.  

A bipartisan law requires North Carolina’s power sector to reduce carbon pollution by 70 percent by 2030 and go net-zero by 2050. The Carbon Plan is the name for the roadmap we’ll follow to reach those deadlines. 

Instead of meeting the law’s crucial climate goalposts, North Carolina’s regulated monopoly Duke Energy has proposed a Carbon Plan that misses the 2030 carbon reduction deadline by five or more years, doubles down on building new fossil fuel plants, and relies too heavily on technologies that experts call expensive, unproven, and – maybe most significantly – commercially unavailable. 

The terms “hydrogen-capable gas turbine” and “small modular nuclear reactor” don’t easily conjure a mental image. Jargon is one way that utilities can obscure the downsides of technologies or policies, contributing to what journalist and Volts founder David Roberts calls the “forcefield of tedium” that shields energy companies from scrutiny. But both technologies play an outsized role in Duke’s Carbon Plan proposal, and SELC Senior Attorney Nick Jimenez says there’s one simple fact every North Carolinian should know about them.  

“What unites these two technologies is that they’re not commercially available,” he explains. “We don’t know when they will be, or what the cost will be.”  

In its plan, Duke presents the technologies as key to reducing carbon pollution in the future. But Jimenez says that far from a silver bullet for solving climate change, Duke’s overreliance on the speculative technologies – which will likely remain unavailable for decades to come – functions as a convenient excuse for the utility to delay the clean energy transition and assuage worries about its proposal for a massive buildout of new climate-polluting methane gas plants.  

“By effectively promising that speculative technologies will eventually save the day, Duke can wave away North Carolinians’ well-founded concerns about the fossil fuel infrastructure the company seeks to build now,” he explains. 

Let’s take these speculative technologies in turn. Duke’s current gas infrastructure mainly runs on methane, a harmful fuel that warms our climate. The idea behind hydrogen-capable gas turbines is to switch from burning methane gas to a mix of methane and hydrogen. Hydrogen doesn’t emit carbon dioxide when burned, which is why it’s sometimes claimed as a climate-friendly fuel. 

In a state already experiencing impacts from climate change, we can’t wait on unproven future technologies to save us and postpone the clean energy transition in the meantime.

Nick Jimenez, Senior Attorney

But it’s not so simple. Almost all hydrogen produced today comes from splitting fossil fuel molecules – a polluting process that offers no benefits for our climate. Only “green hydrogen” – hydrogen derived from water and produced using zero-emissions clean energy – could have a neutral impact on our climate. Yet even if Duke blends only green hydrogen into its gas pipes, the technology may result in little climate payoff and an enormous cost for customers. 

Blending hydrogen into traditional gas pipes is fraught with risk. When hydrogen makes up more than a small portion of a hydrogen-gas mix, the fuel can make pipes brittle and increase the chance of leaks and explosions. At safe levels, experts suggest that green hydrogen mixed into traditional gas infrastructure could decrease a gas plant’s pollution by 7% at most.

Duke has suggested that the methane gas fleet it builds over the next decade – currently one of the largest proposed gas buildouts in the country – could run solely on hydrogen by 2050 to comply with the state’s carbon-free energy deadline. But doing so would require rebuilding the utility’s gas infrastructure from the ground up. 

“It’s an impractical and staggeringly expensive plan,” says Jimenez. “I can’t imagine customers are going to be happy when they find out they’re being asked to pay for essentially the same infrastructure a second time.”  

Small modular nuclear reactors, or SMRs, are scaled-down nuclear reactors. A new style of nuclear reactor, SMRs don’t exist yet in the United States. “A technology that’s commercially unavailable and shows no signs of dropping in price in the near future is a shaky justification for underinvesting in proven clean energy sources,” says Jimenez.  

He points to the fact that the small reactors are not currently a cost-effective investment. The first federally funded SMR project was cancelled last fall due to its mushrooming price tag. David Schlissel of the Institute for Energy Economics explained at the time that the project’s customers “avoided a giant financial debacle.”  

For Duke, the priciness may be part of the point. Energy policy experts warn that speculative technologies may ensure high returns for utility companies – which earn greater profits the more their infrastructure costs – but offer little benefit to customers, who would bear those costs.   

Jimenez says it’s frustrating to see hydrogen blending and SMRs overrepresented in Duke’s proposed portfolio, when solar, wind, battery storage, and energy efficiency are proven solutions, available now, and cost-effective. “These are far and away our cheapest resources,” he says. “In a state already experiencing impacts from climate change, we can’t wait on unproven future technologies to save us and postpone the clean energy transition in the meantime.”  

The North Carolina Utilities Commission will issue a Carbon Plan in late 2024, after intervenors, expert witnesses, and people across our state have a chance to weigh in. As for his vision for the plan, Jimenez explains, “SELC wants exactly what the law says. We want a plan that cuts carbon pollution from the power sector by 70 percent by 2030 and puts us on the path to net-zero by 2050. And we want to do that in the most cost-effective way possible.” 

The overwhelming majority of North Carolinians want a timely clean energy transition, too, as we strive to build a safe, healthy, and affordable future for our communities and our children, and to break away from a dangerous, profitable pattern of delay from utility companies. Let’s recognize Duke’s speculative “solutions” for what they are – little more than a tall tale.