To generate extra power in future, Duke plans to lean on natural gas, solar energy

In its updated carbon reduction plan, Duke Energy describes needing significantly more power to meet demand than previously anticipated and describes an “all of the above” approach that relies heavily on solar and natural gas.

“A diversified resource mix is going to be needed to balance all of our planning objectives, and with the new increase in projected load we’re going to need more of all of those resources relative to what we were projecting last year,” Glen Snider, Duke Energy’s managing director of resource planning, told The News & Observer.

Duke is projecting that North Carolina’s growth and the electrification of cars and houses will increase electricity demand by 35,000 gigawatt hours by 2035. The utility described how it plans to meet that demand in a resource plan filed Tuesday afternoon with the South Carolina Public Utilities Commission. The North Carolina version, which is expected be identical because Duke’s utilities operated across state lines, is expected to be filed Thursday.

The plan complies with the provisions in North Carolina’s House Bill 951. That 2021 law requires Duke to target a 70% reduction in carbon dioxide emissions from 2005 levels by 2030 unless it is waiting for advanced nuclear or offshore wind permits.

The utility must achieve net zero by 2050. Right now, it has a 46% reduction from 2005 levels.

In its 2022 carbon reduction proposal, Duke Energy described four pathways that were consistent with the state law while recommending a set of near-term actions that kept all of them open. The latest iteration includes three pathways, with Duke recommending one that it says would achieve the 70% reduction by 2035 at the lowest cost and with the lowest risk to the grid.

“It is ultimately up to the Commission to make the determination on the pace and what resource mix that North Carolina uses on its clean energy transition,” Kendal Bowman, Duke Energy’s North Carolina state president, told The N&O.

Part of reaching that goal is retiring Duke’s six remaining coal plants in North Carolina. The company is committed to retiring those by 2035 and finding new energy sources that can replace them, Bowman said.

“We’re also focused on those communities where we will be retiring those coal facilities and really focusing those efforts to put replacement generation in those locations,” Bowman said.

The Utilities Commission is required to consider cost and reliability when deciding on a carbon plan. Duke’s proposed plan would cost $92 million through 2038, while the proposal that reaches the 70% target by 2030 would cost $130 billion through 2038 and reaching it by 2033 would cost $101 billion through 2038.

Duke’s projected increases to an average residential customer range from $35 per month in 2033 and $55 in 2038 under its preferred plan to $60 per month in 2033 to $70 per month in 2038 under the plan that reduces emissions the fastest.

Here’s a look at some of the resources and how Duke Energy’s plans for them have shifted:

New natural gas

• Last year’s plan: 3.2 to 3.8 gigawatts by 2035

• This year’s plan: 5.3 to 6.2 gigawatts by 2035

• Duke’s preferred plan: 6.2 gigawatts by 2035

In the near term, Duke is proposing the replacement of coal plants at Catawba County’s Marshall Steam Station and Person County’s Roxboro Steam Plant with natural gas plants.

Natural gas-fired power plants emit much lower amounts of carbon dioxide than coal plants, but fracking for and transporting the methane that is burned in them results in emissions of that higher-powered but shorter-lived greenhouse gas.

Powering the new natural gas plants would require new pipeline infrastructure. Right now, the Transco Pipeline system is the only one bringing natural gas into North Carolina, but Duke Energy has expressed support for the MVP Southgate project.

Along with other utilities in the Southeast, Duke has applied for a hydrogen hub grant from the U.S. Department of Energy, an effort to bolster the production and use of the gas as a power source.

Duke envisions turbines starting by burning about 3% hydrogen by 2041, with that increasing slowly as the pipes and electrolyzers that are needed to create hydrogen are built out.

“It’s an important fuel and you’ve got to have a long-range view on it,” Snider said.

Solar and battery storage

• Last year’s solar plan: 7.6 to 11.9 gigawatts by 2035

• This year’s solar plan: 11.8 to 14.9 gigawatts by2035

• Duke’s preferred solar plan: 11.9 gigawatts by 2035

• Last year’s battery storage plan: 2 to 4.2 gigawatts by 2035

• This year’s battery storage plan: 4.3 to 6.7 gigawatts by 2035

• Duke’s preferred battery storage plan: 4.3 gigawatts by 2035

Duke’s preferred pathway would include six gigawatts of new solar by 2031.

“This is pushing us up to some of the more aggressive levels that we showed last year, but we think this is realistic and attainable at this moment in time,” Snider said.

Duke is also proposing more battery storage than it had in its previous plans. The company’s preferred pathway would add 4.3 gigawatts of battery storage by 2035, while the other two plans would see 6.1 and 6.7 gigawatts.

Those are all higher than the four previous plans, which ranged from two to 4.2 gigawatts of battery storage.

Advanced nuclear reactor

• This year’s plan: 0.6 gigawatts by 2035

• Last year’s plan: 0.6 gigawatts by 2035

Just like last year, Duke is planning to add 600 megawatts of advanced nuclear in the new plan.

The key difference is that the company revealed it plans to build that advanced nuclear reactor at the site of its Belews Creek Steam Station, a coal plant in Stokes County.

“You have the land, the water, the transmission interconnection but importantly there are significant incentives for new nuclear in the Inflation Reduction Act,” Snider said.

Utilities are eligible for additional IRA tax credits if those carbon-free facilities are built in communities that are already the sites of fossil fuel-fired power plants. That means the Belews Creek site offers additional benefits.

“We’re trying to maximize use of federal funds to lower the cost of the energy transition for our customers,” Snider said.

Long-term, all three of Duke’s plans are heavily reliant on additional advanced nuclear reactors. By 2050, when the company expects to reach net zero, it expects nuclear will make up 68 to 70% of the energy mix in the Carolinas.

Other resources

The new plans include between 1.7 and 2.3 gigawatts of onshore wind, with Duke planning to build 1.2 of those by 2033.

Previous proposals all included 1.2 gigawatts of onshore wind by 2035. They also included various amounts of offshore wind, ranging from nothing to 1.6 gigawatts.

The utility kept the option of developing up to 1.6 gigawatts of offshore wind in its preferred resource plan. To develop an offshore wind site in time for 2023, Duke wrote, it would need direction from regulators to do so by the end of next year.

Plans that reduce carbon more quickly included between 1.6 and 2.4 gigawatts of offshore wind by 2033.

Duke also plans to add 1.7 gigawatts in pumped storage capacity at its Bad Creek facility in South Carolina. That stayed the same in this year’s plan.

The N.C. Utilities Commission will conduct a hearing on the proposal before giving Duke Energy direction. The commission has the power to review Duke’s carbon-reduction plan every two years.

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.