Southern State's Greenhouse Gas Law Faces GOP Repeal

In the heart of the South, North Carolina's ambitious energy law, enacted in 2021, aimed to sharply reduce power plant emissions by 2030 and achieve carbon neutrality by 2050. This bipartisan effort, championed by then-Gov. Roy Cooper and Republican lawmakers, was hailed as a significant step towards a cleaner energy future. However, the political landscape has shifted, and the state's Republican-controlled legislature is now seeking to repeal a key component of this law.

The 2021 energy law required Duke Energy, the state’s dominant electric utility, to take "all reasonable steps to achieve" reducing carbon dioxide output 70% from 2005 levels by 2030. This interim goal was seen as a critical step towards reaching carbon neutrality by 2050. However, the proposed repeal of this 70% target deadline could lead to a scaling back or delaying of solar and wind energy production, as well as a greater reliance on natural gas over the next decade. This shift could hinder the state's ability to stay on track to meet its 2050 carbon neutrality goal.

Senate Republicans argue that removing the 70% target deadline would help Duke Energy assemble less expensive power sources now and moderate the electricity rate increases necessary to reach the 2050 standard. They cite models estimating that removing the interim goal would reduce by at least $13 billion what Duke Energy would have to spend—and pass on to customers—in the next 25 years. However, Democrats and environmental groups have criticized this move, stating that "not having any target, even an aspirational target, could mean that we don’t stay on track to get to our 2050 goal." (Democratic Sen. Julie Mayfield).



The potential repeal of the 2021 energy law could significantly impact the state's progress towards carbon neutrality by 2050. To maintain this goal, alternative strategies could include increased investment in renewable energy, energy efficiency programs, carbon capture and storage (CCS) technologies, and nuclear energy. Additionally, strengthening regulatory oversight of Duke Energy and other utilities could ensure that they continue to make progress towards carbon neutrality, even without the 70% target deadline.

The economic implications for Duke Energy and its customers are also significant. According to Senate Republicans, removing the interim goal would reduce by at least $13 billion what Duke Energy would have to spend—and pass on to customers—in the next 25 years. This is based on modeling from Duke Energy and a state agency that represents consumers before the Utilities Commission. The bill also allows Duke Energy to seek higher electric rates to cover incremental construction costs of a nuclear or gas-powered plant, rather than wait until the project's end. This option would avoid one massive rate increase at the project’s conclusion, reining in customer costs. However, critics argue that this would boost Duke Energy’s profits on expensive projects even if never completed. Duke Energy has supported the bill, stating that the “legislation allows modern, efficient and always-on generation to be deployed faster and cheaper” and pointed to the commission's order last fall. The North Carolina Chamber backs the bill, but some companies oppose it. The new governor has panned the bill, indicating potential resistance to its passage.

In conclusion, while the repeal of the 2021 energy law could impact North Carolina's progress towards carbon neutrality, alternative strategies could be employed to maintain this goal. It is crucial for the state to continue investing in renewable energy, implementing energy efficiency programs, and exploring new technologies such as CCS and nuclear energy. Additionally, regulatory oversight could play a key role in ensuring that utilities continue to make progress towards carbon neutrality. The economic implications for Duke Energy and its customers are also significant, and the state must carefully consider the potential impacts of repealing the 2021 energy law.