North Carolina Environmental Officials: Too Anti-Regulation Even for Duke Energy?

Just how extreme is the administration of North Carolina Gov. Pat McCrory (R) when it comes to obstructing efforts to protect the environment?

So extreme that even Duke Energy – McCrory’s former longtime employer, one of his top political benefactors, and a major polluter in the state – is calling on it to dial back the anti-environmental obstructionism.

Speaking at a Jan. 29 forum on the state’s energy future, Mark McIntire, Duke’s director of environmental policy and affairs, urged North Carolina to take a different approach to the Obama administration’s Clean Power Plan to cut global warming pollution. The plan is being challenged in court by 29 states, including North Carolina, as well as by corporations and industry groups. The lawsuit is being led by Texas and West Virginia.

McCrory has charged that the plan would raise electricity rates and amounts to “federal intrusion.” So his administration submitted a compliance proposal that fell short of EPA’s requirements, with the intention of taking the rejection to court – an approach that’s earned condemnation from environmental advocates and criticism from Duke Energy.

“Quite frankly, the approach our state is taking is one that is not collaborative,” McIntire told the N.C. Leadership Forum panel. “We are continuing to encourage the Department of Environmental Quality to think a little bit larger – let’s bring all the stakeholders in the room.”

At the urging of some of those stakeholders, including utilities and industry groups, the McCrory administration did agree to develop a backup plan that would comply with EPA requirements in order to avoid having a federal plan imposed on it.

But apparently that was not enough to assuage Duke Energy’s concerns that the administration isn’t doing enough to involve affected parties in shaping a constructive response to federal efforts to curb carbon emissions.

North Carolina Fights Rules Despite Being on Track for Compliance

The Clean Power Plan experienced a setback this week, when the U.S. Supreme Court temporarily blocked it as an appeals court considers the expedited challenge to the rule. The Obama administration says it’s “confident” it will “prevail on the merits.” Most Americans support the plan – including a majority of North Carolina residents and those in most of the other states suing over the regulations.

First proposed in 2014, the Clean Power Plan sets standards for power plants and goals for states to cut carbon pollution. States are supposed to submit compliance plans by September, though they can apply for a two-year extension. The first deadline for emission cuts comes in 2022, with full compliance required by 2030.

Duke Energy challenged the EPA’s ability to regulate greenhouse gas emissions through theUtility Air Regulatory Group, a broad alliance of energy companies; the case, which went to the U.S. Supreme Court, largely upheld the EPA’s powers. Duke is now working with the six states in which it operates – the Carolinas, Florida, Indiana, Kentucky and Ohio – to discuss ways to comply with the Clean Power Plan. All of those states are parties to the lawsuit against the plan.

Under the federal rules, North Carolina would have to cut its carbon emissions 32 percent by 2030. Environmental advocates have pointed out that the state is already on track to reach the required reductions thanks to existing environmental laws including the Clean Smokestacks Act and the state’s renewable energy portfolio standard.

In a recent radio interview, N.C. DEQ Secretary Donald van der Vaart acknowledged that the state would “probably be able to achieve that mandate naturally.” However, he said, “that doesn’t mean that I’m going to sign on to a rule that is inherently illegal.” An engineer and attorney, van der Vaart previously worked as a North Carolina air quality regulator and in research and regulatory positions for private-sector energy companies.

But his judgment of the plan’s legality is not shared by the 18 states, two dozen power companies, clean-energy associations, and public health and environmental groups supporting the plan. North Carolina Attorney General Roy Cooper, a Democrat who is running for governor, has also called on the state to comply.

“When a politician and his appointees are dragging their feet on climate action even over the objections of one of America’s biggest corporate owners of coal and nuclear generating plants, you know that they have gone off the deepest end of the unreasonable scale,” according to an analysis by the N.C. League of Conservation Voters.

Is Nuclear Power Really “Clean”?

Speaking of North Carolina’s renewable energy portfolio standard, that has also emerged as a point of disagreement between the McCrory administration and Duke Energy.

Passed into law in 2007 by an overwhelming majority of state lawmakers as a way to jumpstart a cleaner energy economy, North Carolina’s standard requires the state’s investor-owned utilities to meet 12.5 percent of their retail sales through energy efficiency or renewable sources by 2021. North Carolina was the first state in the Southeast to adopt such a standard.

What constitutes a renewable source? Here’s what North Carolina’s law says:

a solar electric, solar thermal, wind, hydropower, geothermal, or ocean current or wave energy resource; a biomass resource, including agricultural waste, animal waste, wood waste, spent pulping liquors, combustible residues, combustible liquids, combustible gases, energy crops, or landfill methane; waste heat derived from a renewable energy resource and used to produce electricity or useful, measurable thermal energy at a retail electric customer’s facility; or hydrogen derived from a renewable energy resource.

What doesn’t constitute a renewable source? The law is clear on that, too:

‘Renewable energy resource’ does not include peat, a fossil fuel, or nuclear energy resource.

But at a recent meeting of the N.C. Energy Policy Council, a state advisory group, DEQ’s van der Vaart pushed hard for the group to call on the legislature to amend the law to include nuclear power on the list of approved energy resources – despite its serious safety and security risks, radioactive-waste disposal challenges, and intense water requirements.Describing nuclear energy as “clean,” van der Vaart and said it “needs to be incentivized.”

Duke Energy is heavily dependent on nuclear power, which accounts for 56.8 percent of its generation mix in the Carolinas, and CEO Lynn Good recently discussed its importance in a carbon-restricted energy economy. But even so, it was Duke Energy’s representative on the council, Rob Caldwell, who pushed back against van der Vaart’s proposal, arguing that a “one-off” vote for nuclear power wasn’t wise. He also said the issue was “significantly more complicated” than van der Vaart described.

In the end, the council delayed its vote on the recommendation. They plan to discuss it again at their next meeting in March.