NC House approves compromise energy bill, sending it on to Gov. Roy Cooper
The compromise energy bill that Gov. Roy Cooper and legislative Republican leaders announced late last week passed the House on a 90-20 vote Thursday and is now on its way to the governor for his signature.
The Senate voted 42-7 Wednesday to approve the compromise on House Bill 951.
Since the compromise legislation was announced late last week, its potential costs and benefits have been the topic of much conversation. On one hand, it would turn greenhouse gas targets that Cooper set in his Clean Energy Plan into law while also requiring the N.C. Utilities Commission to consider affordability and reliability when deciding how Duke Energy, the state’s dominant utility, achieves those goals.
But there have also been concerns among energy justice advocates and some Democrats that passing the bill would lead to rate hikes without providing protections to the people most impacted by them.
Sen. DeAndrea Salvador, a Charlotte Democrat, said passage of the bill is necessary to improve air quality, a reference to the communities around coal-fired power plants that would likely retire in order to meet greenhouse gas reductions of 70% from 2005 levels by 2030 and carbon neutrality by 2050.
But, Salvador said, it will be important for advocates to continue working with the N.C. Utilities Commission as it makes rules, particularly in order to protect those who struggle to pay their energy bills.
“I am personally committed to holding us accountable and seeing the ongoing efforts through completion in a way that aims for sustainable, reliable, affordable energy for all,” Salvador said.
In the House, Rep. Jay Adams, a Catawba County Republican, said a local economic development official told him to vote for the bill without hesitation. House Bill 951 would, Adams said, help industries in counties like Catawba.
“One of the things that you have to have in manufacturing, you have to have abundant energy, you have to have reliable energy, and you have to have relatively inexpensive energy,” Adams said, urging his counterparts to support the bill.
Does the bill protect low-income customers?
During a Senate committee meeting on Tuesday, Sen. Paul Newton, a Cabarrus County Republican, outlined nine ways that he believes House Bill 951 protects Duke’s lowest-income customers.
Among those, Newton maintained, were a program where utilities can pay for home improvements that will improve energy efficiency and customers can use their energy savings over time to pay them back; the requirement that the Utilities Commission consider the “least cost” path when approving Duke’s carbon reduction plans; and jobs created by companies meeting their clean energy standards.
“We care about the impact to low-income customers,” Newton told the Senate Rules Committee on Wednesday. “That is not a partisan issue, we both care about that. We do not and cannot allow the poor to be hurt as we reduce carbon in North Carolina.”
But energy justice advocates maintain that the protections cited by Newton fail to protect those struggling to keep the lights on.
Al Ripley of the N.C. Justice Center has been one of the most prominent voices on the matter, speaking in front of each of the three Senate committees that approved the bill.
In 2019, Ripley noted, Duke Energy disconnected service to nearly 225,000 North Carolina residential customers. That was the last full year before pandemic-era protections against utility cutoffs were enacted.
Ripley has also challenged the home-improvement program, saying it won’t work because many low-income utility customers rent their homes and cannot install installation or make similar repairs covered by the program. Similarly, Ripley has said, some customers may be living in homes that simply need too many repairs for the utility to make them work from an economic standpoint.
Ripley had concerns about each of Newton’s other points, including the senator’s contention that requiring the N.C. Utilities Commission to consider the cheapest path to carbon reductions would protect customers. In addition to the price of changes, Ripley said, the bill calls for the commission to consider “the adequacy and reliability” of the existing grid in moving away from coal. Ripley said that could lead to upgrades to the utility grid and energy transmission that are not the cheapest options available.
“The way the least-cost provisions are designed, it requires other elements that will actually not lead to the least-cost outcomes,” Ripley said.
Several Senate Democrats who spoke about the bill on Wednesday said it does not go far enough in protecting low-income utility customers.
Sen. Don Davis, a Greenville Democrat, recounted a recent conversation with a constituent who was expressing concerns about a hole in the floor of their rental home. Davis, who voted against the bill, said there are simply too many people struggling with utility payments and called on his colleagues to come back and pass stronger legislation protecting those customers.
“We can all agree the rates are going to increase,” Davis said. “That’s inevitable, irregardless, and there are people with holes in their floors on the other end of this. Those are their living conditions.”
Who will decide how Duke reduces carbon?
A bipartisan group of legislators on Wednesday touted House Bill 951’s greenhouse gas reduction benefits, saying it represents much-needed progress toward cleaning up the state’s power generation.
“The bill that is before you today is one of the strongest energy policies in the country,” said Sen. Mike Woodard, a Durham Democrat.
But opponents of the legislation are worried that it could place Duke Energy on the same footing as the Utilities Commission, particularly regarding whether the carbon reduction plan is adjusted when it is reviewed every two years. The clause in question states, “The Carbon Plan shall be reviewed every two years and may be adjusted as necessary in the determination of the Commission and the electric public utilities.”
To Ripley and other opponents of the legislation, that means that Duke would have equal say into any adjustments as the state’s Utilities Commission.
“Every third grader in North Carolina could tell you what that sentence said, there is no ambiguity,” Ripley said.
During the Senate Rules Committee hearing on Wednesday, though, Newton said the intent is to leave the Utilities Commission — not Duke — in charge of the reduction plan.
“The commission is the ultimate determiner of whether the plan gets adjusted,” Newton said.
And Kevin McLaughlin, Duke Energy’s vice president of government affairs and external relations, sent a letter Wednesday saying that the company shares that stance.
“H951 does not, in any way, give Duke Energy equal footing with the Commission or veto power over Commission decisions with respect to the Carbon Plan,” McLaughlin wrote to Dionne Delli-Gatti, North Carolina’s clean energy director and the Cooper Administration’s lead negotiator on the agreement.
The true impact of House Bill 951 will, in many ways, be shaped by the rates and rules developed by the Utilities Commission, said Brianna Esteves, a state policy manager at sustainability nonprofit Ceres.
In response to the original version of House Bill 951, Ceres penned a letter opposing the legislation to state leaders on behalf of prominent businesses operating in North Carolina like Biogen, Google and Sierra Nevada.
The new version is improved, Esteves said, with emissions targets helping those companies meet their own sustainability goals and new programs likely helping them buy power from renewable sources. But the impacts of potential multi-year rate plans are still a worry, as are loopholes that could allow Duke to delay meeting carbon goals if it is developing a complicated nuclear or wind project.
“The bill puts a lot of faith into the good intentions of the commissioners,” Esteves said, “and certainly we hope the commission will always be filled with smart, good and thoughtful people moving forward.”
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 October 6, 2021 at 6:19 PM with the headline "NC House approves compromise energy bill, sending it on to Gov. Roy Cooper."