New energy report could yield a win-win for climate and pocketbooks

New energy report could yield a win-win for climate and pocketbooks

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COVID taught us a lot about living in crisis mode. The biggest lesson: Address crises early enough to avoid a complete disruption of our lives.

Let’s start with the climate crisis.

If we cannot slow climate change before certain tipping points are reached, changes will accelerate of their own accord and disastrous consequences will mount. There will be worse weather extremes, food shortages, mass migrations of people escaping rising seas, and the extinction of an estimated one-third of all species by 2050.

We know what causes it: burning oil, coal and natural gas. We know how to fix it: Switch to clean, cheaper energy. But we have been unable to agree on how to get there fast enough.

Hopefully, the Biden administration will take bold action, but states must also do their part, and the North Carolina General Assembly will soon have an opportunity to take up some new options.

Last year, Gov. Roy Cooper’s Department of Environmental Quality convened diverse stakeholders to propose recommendations to fulfill parts of DEQ’s 2019 Clean Energy Plan. I participated in this year-long process, along with representatives of other environmental and social justice organizations, electric utilities, state and local government, academia, business, manufacturing, and the renewable energy industry.

Guided by some of the nation’s top experts, we explored four policy ideas for reducing greenhouse gas emissions. While not the ideal solution for any one stakeholder, they represent our best effort at a win-win.

  • Ditch coal faster. Identify which coal-fired power plants are least economic to run. Retire them early in a way that keeps the utility whole but saves customers money. This can be done through securitization: issuing bonds that are paid back over time on power bills. The bond proceeds replace the utility’s unrecovered investment and can be used to acquire clean energy infrastructure.
  • Level the playing field. When more energy generation is needed, the utility normally decides what kind of power plant to build. Under all-source competitive procurement, the utility and other companies bid on new generation. The least expensive bid that also meets requirements is selected. The fact that renewable energy paired with battery storage is outcompeting natural gas in many states means this could yield more affordable electric bills and a quicker transition to clean energy.
  • Change what utilities earn money on. Currently, utilities boost profits by selling more electricity and building capital assets such as power plants. Performance-based regulation breaks the link between earnings and the amount of electricity sold and rewards utilities for achieving public policy goals such as energy efficiency, increased renewable energy adoption, emissions reduction and affordability.
  • Explore collaboration. Some states have reduced emissions and saved money by joining wholesale electricity markets in which multiple states form a common entity in which power providers compete to supply energy. South Carolina is conducting a study to determine if such an arrangement would be beneficial there. As their most likely collaborator, we should do a comparable study.

Click here to read every wonky detail.

The next step is for the General Assembly to consider these ideas in crafting a bill during the legislative session that began this month. In doing so, legislators should consider the voices of participating stakeholders and the general public while ensuring a fair and transparent process.

NC WARN will be working alongside other stakeholders to ensure the best ideas are incorporated into legislation to help slow climate change and protect people and the planet.

Climate change is harming North Carolinians now, and quickly worsening, so the legislation must be robust and ambitious. Otherwise, North Carolina will have squandered an opportunity to help humanity step back from the climate brink.

Sally Robertson is the Policy Coordinator for Durham-based nonprofit, NC WARN.