Duke Energy has thrown consumers under the proverbial (electric) bus to make their operations carbon neutral by 2050. As a result, electricity prices in North Carolina may increase by 19% over the next three years.
The company’s president, Lynn Good, receives more than $20 million annually in compensation financed in part by ensuring that consumers lower their carbon emissions.
Following the 2021 enactment of the Energy Solutions for North Carolina Act, the vertically integrated Duke Energy is attempting to decarbonize the Tar Heel State by 70% by 2030 and fully decarbonize by 2050. This misguided initiative will force everyday families to subsidize a complete overhaul of the state’s power grid at a total cost approaching $160 billion.
The North Carolina Utilities Commission report and Chapter 4 of Duke’s 2023 Carolinas Resource Plan encourage the exploration of using dynamic rate designs in order to raise prices just when consumers need to use power the most. Essentially, the plan would increase the prices for power in the dog days of summer and the depths of winter. Even everyday activities such as cooking dinner, watching a TV show, or doing the laundry in the late afternoons and evenings could be subject to rate increases.
Duke’s exclusive focus on environmental, social, and governance nonsense has led it to shut down 56 coal-powered generators since 2010. The company has abandoned meritocracy and has mandated that a quarter of its workforce be women and people of color, irrespective of ability. Additionally, it wants to reduce customer energy consumption by 24,000 gigawatt hours and lower peak summer demand by 7,000 megawatt hours by 2025.
This focus on fake frugality over providing value can already be seen in its corporate history.
Duke announced it would pay more than $200 million to clean up its leeched toxic coal waste that spilled into ground water in Indiana, but subsequently tried to illegally and retroactively raise rates on the very consumers it harmed to pay for it. Additionally, Duke shut off power to more than half a million residents of North Carolina on Christmas Eve of 2022. No warnings were given when it took 1,300 megawatts of coal and natural gas capacity offline, ruining many family gatherings as temperatures fell to the low single digits.
The North American Electric Reliability Corp. warned Duke and other operators in the South in its 2018 report that these power plants needed to be weatherized properly. Additionally, the largest factor leading to outages was Duke’s failure to purchase dedicated or firm gas supplies for Christmas Eve, the exact issue a 2019 report from the American Petroleum Institute addressed.
Perhaps Duke—which employs more than 26,000 people and serves almost 10 million customers with natural gas and more than 50,000 megawatts of electricity in North and South Carolina, Florida, Indiana, Kentucky, Ohio, and Tennessee—should refocus its efforts on providing electricity, rather than virtue signaling.
With an annual profit of $2.56 billion in 2022, Duke has ample resources to stabilize the grid without raising rates.
Instead, the quest to decarbonize North Carolina would cost between $140 billion and $160 billion through 2050, according to the John Locke Foundation’s analysis of Duke’s various carbon plans. The plans’ overemphasis on solar and wind and on unrealistic pricing of hydrogen come at the expense of “reliable, dispatchable power plants that would decarbonize at the lowest possible cost.”
Perhaps Duke is even aware of this, as it is trying to sell off its unregulated renewables division to Brookfield Renewable, which explicitly assumes carbon pricing in its investment process, despite the cost of carbon being far from settled. However, Duke is still pushing forward with its $150 million lease of the Carolina Long Bay for an offshore wind farm that will have the same inefficiencies, ecological damage, and tourism-destroying effects as New Jersey’s.
Even if the entire United States halted all fossil fuel emissions right now, global temperatures would only decline by 0.02 of a degree Celsius by the year 2100.
Despite the math not being in their favor, Democrats have weaponized ESG by imposing corporate environmental and social policy on companies that then in turn lobby legislatures, such as North Carolina’s, for decarbonization and massive tax subsidies.
Furthermore, the Federal Reserve has been indirectly backing the ESG wokeness that has pervaded corporate America, potentially leading to another banking crisis. North Carolina should repeal its law and join the ranks of the 31 state attorneys general who stand against woke investing.
Instead of continuing down the ESG path, North Carolina should take a page from South Carolina and explore electricity market reform.
The Brattle Group’s report for South Carolina suggested making a Southeast Transmission Organization with North Carolina and other Southern states to save each customer between $115 and $187 annually. Additionally, the benefits for South Carolina adopting such competitive investment reforms could be as high as $370 million a year if the state fully participates. Other states, such as North Carolina, could also see similar benefits, and it would further stabilize every state’s power grid.
If North Carolina wants to strengthen its economy and serve its residents, the state should deregulate the electricity market and foster a business culture encouraging economic development, regardless of ideology.
Renewables projects and their storage capacities that are economically viable should be able to compete against other sources without $160 billion in state subsidies or making consumers pay for the energy transition.
Certainly, North Carolina should not support policies that make electricity increasingly unaffordable to its residents and push them into poverty.
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