NC unveils major energy legislation reducing coal production. Could it come at a cost?
Republican House lawmakers unveiled energy legislation Tuesday, drafted for months in secret with industry representatives, that would hasten North Carolina’s transition away from coal power plants.
The bill urges Duke Energy, the state’s largest utility and a party to the closed-door discussions, to replace the state’s largest existing coal plant with gas-powered generation. That project would likely require utilities and regulators to advance the now-stalled MVP Southgate pipeline, according to a summary of the legislation obtained by The News & Observer.
While reducing coal plants would bring climate and health benefits with lower emissions of greenhouse gases and other pollutants, the legislation could also pressure state regulators to permit the highly controversial pipeline amid concerns about the environmental impact of its construction. The bill touts an “all of the above” approach that environmental groups object to because it seeks to replace coal not only with renewable sources like wind and solar, but also with natural gas and potentially nuclear power.
In a statement emailed to The News & Observer, Grace Rountree, a Duke Energy spokeswoman, wrote, “We support our state leaders charting a path forward for an orderly energy transition – one that supports North Carolina communities and helps ensure the continued affordability and reliability our customers depend on. We also believe it is important to incentivize clean energy investments and modern cost recovery mechanisms.”
While House lawmakers hashed out the details of Tuesday’s energy bill, Senate Republicans raised alarms in recent weeks about the state’s energy infrastructure and its dependence on the Transco Pipeline as its sole source of natural gas. Following the hacking of the Colonial Pipeline and the subsequent gasoline shortage, legislators’ heightened concerns about the impact of any disruption to the pipeline played a role in the state Senate’s decision to deny the appointment of Dionne Delli-Gatti, Democratic Gov. Roy Cooper’s nominee to head the N.C. Department of Environmental Quality.
Lawmakers said Delli-Gatti’s inability to explain the Cooper administration’s policy on natural gas was pivotal to their decision. Two days after Delli-Gatti’s hearing, DEQ reaffirmed its denial of a stream-crossing permit for the MVP Southgate project, which would carry natural gas from the Marcellus Shale in West Virginia through Rockingham and Alamance counties
The refusal to confirm Delli-Gatti has heightened tensions between the governor and the Republican-majority legislature.
Still, lead bill author Rep. John Szoka, a Republican from Cumberland County, is “guardedly optimistic” that environmentalists, energy industry representatives, lawmakers and the governor’s office will be able to hash out a compromise in the coming days or weeks.
“There are a lot of moving pieces in this, and there’s a lot of give and take so far,” Szoka told The News & Observer Tuesday. “And I expect a lot more give and take before we get a final product.”
Stakeholder meetings
First reported by WRAL in March, Republican lawmakers, Duke Energy, manufacturing and clean energy lobbyists and other industry representatives met for months behind closed doors to shape the bill.
Environmental advocacy, public interest and consumer advocacy groups were left out of those conversations and privately criticized the secretive process but hoped to be included in the discussions later on, WRAL reported.
By contrast, some 90 stakeholders were included in more than two years of talks that led to 2007’s Senate Bill 3.
Democratic members of the House who spoke with The News & Observer Tuesday afternoon had generally not seen the bill or been made aware of specific details. Most of the state’s environmental advocates also got their first look at the bill Tuesday afternoon.
Szoka said cutting back on the number of people in the process made it more efficient.
“When you have too many people in a room, because you can’t really narrow things down, what you end up with is a final document or product that is more aspirational than actually being able to do something,” Szoka said.
Szoka also emphasized that he plans to include groups not involved in early discussions in the process now.
“No bill is perfect, so we need to clean it up and find out where people’s pressure points are, and try and fix whatever we can to make everybody satisfied,” Szoka said.
The legislation includes several provisions that Duke Energy leaders have called for in recent months.
During a February investor call Duke Energy CEO Lynn Good said the company’s goals for the legislation included shifting away from coal power generation, a regulatory structure that helped it pay for a cleaner mix of sources and ensuring that power generation is reliable and affordable.
“We remain optimistic for comprehensive energy legislation this year, aligned with our shared goals of generation transition and regulatory reforms needed to enable that change,” Good said during a May 10 conference call.
Mountain Valley Pipeline
Though the controversial Mountain Valley Pipeline isn’t specifically mentioned, language in the bill specifies that plans to shift power sources at Duke Energy’s Roxboro plant, the largest remaining coal facility in North Carolina, must include a generating facility on the site and be able to deliver continuous power for a weeklong period.
The primary option that seems to present is replacing Roxboro’s coal plant with a natural gas-powered plant. According to a bill summary obtained by The News & Observer, such a project would require the MVP Southgate project to move forward, although Szoka said any project that meets the requirements would be considered.
If it receives permission to proceed in West Virginia and Virginia, the MVP Southgate project could again seek the stream-crossing permit in North Carolina.
Rep. Pricey Harrison said she hopes the pipeline never extends into North Carolina.
“My hope is that they don’t convert any plants to natural gas but go straight to renewable because it doesn’t seem like it’s worth the investment to make the conversion,” said Harrison, a Greensboro Democrat.
In 2017, House Bill 589 required the state’s utilities to purchase 2,660 megawatts of renewable energy. That goal has been met. The new legislation would require utilities to purchase 7,327 megawatts by 2026. Renewable energy includes a broad swath of generation sources from solar to biogas to wind.
The legislation will now go to the House Energy committee, where it will be discussed Thursday. That committee and several others will vote on the bill next week and send it for a vote on the House floor.
This story was produced with financial support from 1Earth Fund, in partnership with Journalism Funding Partners, as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work.
This story was originally published June 15, 2021 at 4:11 PM with the headline "NC unveils major energy legislation reducing coal production. Could it come at a cost?."
