In this episode, we explore Duke Energy’s carbon neutrality plan and whether they are on the right path with experts William Powers and Randy Willis weighing in with their differing views on the topic.
William Powers is an engineering consultant with over 30 years of experience in electric power generation. In his career, he has advised state and federal governments, nonprofits such as NC WARN, and institutions like Duke University. He is based in San Diego, California.
Randy Wheeless works in media relations for Duke Energy, one of the largest electric and natural gas companies in the US. Duke Energy’s Integrated Resource PLan (IRP): https://www.duke-energy.com/Our-Company/About-Us/IRP William Power’s Review of Duke Energy’s 2021 IRP: https://starw1.ncuc.net/NCUC/ViewFile.aspx?Id=9ae4a34d-d374-4146-bcf5-278fbe03e12a Visit our website to keep up with the OC team and for a full transcript of this episode! https://operationclimatepo.wixsite.com/operationclimate Follow us on Instagram at @operationclimate! Follow us on Twitter at @opclimate! Subscribe to us on Youtube! To contact us, DM us on Instagram or email us at operationclimatepodcast@gmail.com! ____________ Guest: Randy Willis and William Powers Hosts: Rishab Jagetia and Ryan Lou Producers: Rishab Jagetia, Ryan Lou, and Clare Sparling Audio Editor: Clare Sparling Music: Cali by Wataboi, what you thinkin by Wataboi
Transcript
KATHERINE
Hey, welcome to operation climate podcast made by young people for young people, where we break down environmental issues through conversations with cool people.
RISHAB
Everyone, this is Rishab and Ryan from operation climate, let's hop right into this episode. So if you're in North Carolina or on the East Coast, there's a pretty good chance you've heard of Duke Energy, which is the second largest utility in the US. And it pretty much controls the energy produced and distributed within the Carolinas. Well, it does share name with our Duke University. For the purposes of this episode, Duke refers to Duke Energy only. There's a lot of controversy over Duke in relation to many issues, from how much power it has is a monopoly to its environmental problems, like coal ash that are polluted certain communities. But we're focusing on the biggest fight of all, Duke in relation to carbon neutrality.
RYAN
Is Duke on the right path to carbon neutrality. Is it lying to the public about its climate goals? Or is it a leader in the energy field? To talk about this contentious issue? We have an industry representative from the very company we're analyzing. Randy Willis, versus Duke critic William powers, an engineer with 30 years of experience in electric power generation, and expertise in fossil fuel plants. There's going to be some opposing opinions, some contradictions, and nuanced discussion of Duke. Get ready. We're in for a treat.
RISHAB
Let's go. Everyone, this is Rishab. I'm joined by Ryan from operation climate. And we're joined by Randy Willis from Duke Energy. Randy, could you tell us a little bit about yourself?
RANDY
Yeah, I'm Randy Willis. I'm in our media relations group. I'm a spokesman for Duke Energy, but mainly cover the clean tech issues of solar energy storage, electric vehicles sustainability.
RISHAB
And on the other side, we have William powers. William, can you tell us a little bit about yourself?
WILLIAM
Yes, I'm based in San Diego, California. I am a engineering consultant. And I do a lot of work primarily with nonprofits and with governments, city governments, state governments, EPA, that type of thing. And I've been quite involved lately in North Carolina, looking at Duke's future plans for energy.
RYAN
Randy got us started. Real quick, could you kind of explain Duke energy's carbon neutrality bowls? And in a nutshell, how is Duke Energy planning to go carbon neutral by 2050?
RANDY
Sure, you know, when we look at our carbon emissions, so we start with the year 2005, which is kind of where the Paris accord starts. So from there, we're about 40, we've cut about 40% of our carbon emissions from the 2005 level, we want to cut 80% by 2030, and be at a net carbon zero by 2050. So we look at 2030, we pretty much have a good path of how to get there, we're still closing some coal fired stations replacing them, we're still up in our renewables, we're still running our nuclear plants a lot. So we think we pretty much have a good path for that. 20 that 80% by 2030. Now to get the carbon neutrality and 2050 You know, we're gonna need some help. There's gonna be some breakthroughs in the future that maybe we don't see today. Is it small, modular nuclear plants? Is it carbon capture? I mean, are there other things out there? And it's hard for us to say here 2021, what's gonna happen in 2031, or 2041. So, to get to that net carbon zero, we're gonna need some breakthroughs on the technology front. But you know, as we've seen in the past 30 years, those things can happen.
RISHAB
To Randy's point, Duke Energy does have a plan to reach net zero emissions by 2050. However, I think it's important that we focus on his thoughts about how we'll get there. Note, Randy doesn't mention a specific pathway of building renewables while replacing natural gas, only hoping for breakthroughs in technology that might come with time. This is the primary focus of our podcast. To what extent are companies like Duke Energy justified in using fossil fuels without committing to renewables? What is the role of natural gas and new technologies in a carbon free future? throughout our interviews, we hope to get closer to answering these questions. Much of Duke energy's plan relies on its iorp or integrated resource plan, which lays out the strategy of how companies like Duke plan their business practices. on this topic, William powers had some skepticism of Duke
RISHAB
for all our listeners, William just released a report or view on Duke energy's iorp, in which you gave extensive criticism of some of their views and their choice. So I'm just wondering how would you describe Duke energy's 2020 integrated resource plan? Like what were some of the key takeaways that you found?
WILLIAM
Well, it's long on natural gas, it's long on burning natural gas in both existing power plants and new power plants. And it's short on real renewable energy projects in their projected reduction of, or addition displacement of fossil fuel fire, let's call natural gas fossil fuel, I'll use them interchangeably, that their actual reduction of usage of gas is relatively small, less than 10% of their total production. And their their plan is really what and this happens all over the country where investor on utilities, meaning privately held monopolies, which is what Duke Energy is projected great things decades down the road. But in the immediate future, there is no sense of urgency on addressing the use of fossil fuels and rapidly getting down to a greenhouse gas free electricity supply.
RISHAB
Clearly, there's a divide between Duke Energy suppose it climate plan, and what critics say is a continuation of the past. One of the biggest reasons for this, as noted by both Randy and William, is how much of a role renewables will play in Duke's transition. Now, we return to Randy talk about Duke specific plan for carbon neutrality, and the role of renewables, nuclear and natural gas.
RISHAB
Besides the carbon neutrality plan, we looked at it from the big picture, I really want to dive into those details of how we're going to get there, and the role of renewables and natural gas. So just for context, like the CEO of Duke Lin, good, she has made it pretty clear through statements. And then also these are statements that I feel like I'm hearing from Duke, that they don't want to make specific commitments to renewables yet, because these vague promises allow them to adapt to the different technologies that are coming and realize that commitments now may look different from commitments in the future because of new technologies. So could you explain kind of the decision making behind not going straight into renewables and rather, building up natural gas plants in the future, and how those really relate to your net carbon zero plan? Sure.
RANDY
So I'll give you kind of a broad brush of Duke and our energy mix, so in the Carolinas, about half of its nuclear power, so we're going to continue to run those nuclear plants as long as we can, they're running well, they're actually running better than they did 20 years ago, carbon free. And I think replacing them would be a challenge. So we're gonna run those when you talk about renewables. So we're looking to, you know, at least double in the next couple of years, our renewable goal from 8000 megawatts to 16,000 megawatts. And we think we could probably add another 8000, as we go out another couple of years. So we do have that goal that we're working for, you know, as far as natural gas, I think that has to be part of the equation there somewhere, because we can close our coal plants, but we've got to replace it with something that's going to run all the time, and still lower our carbon emissions. So natural gas can do that, you know, so it's kind of a number of things. Now hydro, we've we're expanding our hydro, just a little bit in our pump storage facility in South Carolina. But, you know, I think we're going to continue with hydro, and that's going to be a part of it. But I don't think that's a growing part of it. So really, what you have is renewables, you're going to continue with nuclear, you're going to have to have natural gas to replace the coal. And then you kind of move beyond there. But I think we do, we are expanding renewables. We're building a lot in North Carolina and Florida and Texas and other states. So that is a growing part of Duke Energy. And I think that'll continue.
RISHAB
I wanted to continue on this idea of renewables in natural gas. For one, Duke Energy has committed more than 2 billion to renewables in the near future, which is great. But it's still plans to increase them out of natural gas plants, in which around 40% of energy production will come from natural gas in the future. When Duke builds natural gas plants in the 2020s, and then says that they're going to remove these plants in 20 years, there's obviously going to be a lot of costs from that one term to describe this as stranded assets, which are resources that you pay a lot of money for upfront, but they can no longer produce or be valuable in the future. And Duke's case, the future of carbon free electricity might not have room for natural gas plants, which makes them close without earning enough money to cover the costs. So why does Duke then continue to plow ahead with natural gas instead of more renewables? Here are Randy's thoughts
RANDY
people looking at The integrated resource plan is they feel like that's, you know, carved in stone, that's good, what's going to happen over the next 15 years? It's not, it's really a snapshot of what you're going to do for what you see today, 15 years from now. So when we look at that, when we have to say, well, we're gonna have to retire this and build this, that's gonna, you know, that's what we see today. Does that change in five years? Absolutely. Did the 115 years ago look like where we are today? No. So I think sometimes people assume these gas plants are like, carved in stone, they're gonna happen, they may not happen, you know, we may need them. But renewables may be growing, we don't know about offshore wind, what kind of future that has. So, you know, I think we have to do what's prudent, we have to remember another thing one, our power has to be reliable, and also affordable. So when we make those plans for the future, we got to keep those in mind too. You know, we could do a lot of different things that sound cool today. But if we're driving up the price of electricity for people of color, or businesses or anybody, I don't know if we're exceeding that much. So what we see now is that natural gas will play a part of that, you know, five years from now, do we see something different? Are there new technologies we don't know about the day could be. But right now, when we talk about our integrated resource plans, it's really a snapshot of what you see today, maybe not what will happen 510 years down the road.
RISHAB
So what can we make of the iorp? According to Randy, it's just a snapshot. Things might change. We'll see what happens. However, we also must note that Duke is developing non emitting resources. And while the technology can be a little iffy, it is a part of their plan for carbon neutrality. On this point that Randy mentioned, I wanted to hear William power's thoughts. When I was talking to Randy wheeless from Duke Energy, he mentioned that Duke wanted to remain flexible in its approach to carbon neutrality. So it didn't have many commitments to renewables. I think Randy mentioned that what happens right now is not what's gonna happen in five years, everything's a snapshot. So we're going to change a time. That's why we're not committing to renewables right now. How would you give merit to that argument of flexibility and pretty much the argument that we need natural gas right now. And we can't make commitments to renewables, which is an argument that's Duke's is making right now,
WILLIAM
I would say it's hollow. And here's why it's hollow, is that even if you committed to go solar and batteries tomorrow, mean absolute commitment, that's how you're going to do it. 10 years out, that that's the backbone of your supply, it's going to take you several years to get there. And so the idea that, you'll wait and see, and five years from now, you'll wait and see again, doesn't make a lot of common sense. Because if you don't commit now, to doing what needs to get done, then you're basically in neutral, you've put the engine in neutral, you're going to wait and see wait and see. So I see that as being a just a way to duck to duck the inevitability of having to deal with this. And I would like to say I'm based in San Diego, California, and we have our own issues with how our industrial utilities operate out here. We have our own issues with our utilities commission, but we added 2000 megawatts of battery storage over the last 12 months. And so when I hear a utility, like Duke Energy, talk about battery storage, as if it's experimental, very expensive, something to think about in the future. And I live in a place where adding 1000s of megawatts of battery capacity every year, obviously, I'm going to look at that with a jaundiced eye.
RISHAB
Contrary to Duke energy's assumptions, advocates of renewables and clean technologies like batteries, such as William, make the case that we don't need to wait for something better. We have what we need right now. And it's about implementing those solutions in the current moment. We want to push Randy on this very point. These clean technologies are available and cheap. Why does Duke choose a different path?
RISHAB
Why is Duke planning to scale renewables but also scale natural gas and these elfers with time rather than taking the options that we have right now, including the fact that renewables are decreasing in price and like really becoming less expensive for consumers? So like, Is there an argument to be made about Duke investing its resources and the technologies that exist today that is solar and wind an offshore wind, rather than waiting for the future to make that decision?
WILLIAM
I think when you look at the new generation, it's been brought online in North Carolina in the last couple of years, most of it was solar and there's still a lot of solar generation that's being built so I think we are investing in those things. You know, we just have to one thing we do have to remember is that you know, renewables if they have a drawback is that they are intermittent and resource and we need power all the time. So, you know, we're going to have to think about our nuclear plants and how they Run, and even our coal and natural gas that we have right now how do they run because, you know, here's a day where it's about nine degrees we're going to need all weekend. And sometimes, you know, we need every plant that we've got an resource. You've seen that with Texas this year. And maybe California is talking about that right now. So, you know, we are investing in renewables, but I don't think we can bet the farm on renewables is going to carry us over the next 15 years, we've got to look at all those technologies and kind of see which one meets the criteria to make sure the power is affordable and reliable to people. And especially true this time of year when it's so hot. And you're thinking, gosh, you know, every one of those power plants is really needed about this time of year. So you know, we want to make sure we always have power, because when, let's face it, I think we saw in Texas this year, when people don't have power, they get a little upset, and they're gonna wonder why that happened. And they're gonna be in Texas, they could look at one of the ircad that the RTO out there in North Carolina, they go look at Duke Energy and say, Why weren't you on the job. So we take that very seriously.
RISHAB
In response to Randy's argument, William Powers, strongly disagreed. I think the other argument that I heard from Randy was that renewables are intermittent. So natural gas is just a better technology, at least in this moment, overall. So I was wondering how you would respond to that argument?
WILLIAM
Well, here's how I'd respond to Randy, is that I live in an urban environment. In the United States, we have an off grid, solar and battery system that is worked great. For five years, our reliability has been significantly better than the industrial utility that serves this area. And so when it comes to reliability, battery, and ample amounts of storage, or as reliable or more reliable than what the utility can do now, so I just disagree completely with the statement that gas is more reliable. In fact, it's someone who, again, got trained in power systems at Duke University. I've worked a lot on gas turbines, gas turbines fail a fair amount of time. And so one of the issues that we have would do in the report that you were talking about that I'd worked on earlier this year is documenting the failure rate of gas turbines when they're needed during that polar vortex mean, Randy should look at those statistics, and you have multiple gas plants that are not operating because they have some mechanical problem, you would almost never have that with batteries. batteries have a much higher reliability rate than gas. So I definitely disagree with that. Take.
RISHAB
Randy and Duke Energy his main argument rests on the idea of flexibility and the belief that natural gas is more affordable and reliable than other renewable technologies. However, it's clear from William powers that this isn't the whole story. While the issue of natural gas and decarbonisation is certainly complex, William aptly shows that many of Dukes assumptions are oversimplified and just not supported by climate science. So what does that leave us? We wanted to ask William, this very question.
RISHAB
Again, came into this conversation thinking that this issue of carbon neutrality is a little more complicated, and I don't want to give Duke Energy credit. But that's I thought they had a point but seems like through this conversation, it's it's pretty clear to you that a lot of their arguments are pretty hollow. And this just leads me to think like, how, how are they justifying this? Like, what is the reason that Duke Energy is doing all these plans, even though even their own scientists can cite facts that say that it's not their choice? Is it money? Is it the only way for them to profit? I don't know.
WILLIAM
In some ways, it's remarkably simple. And like I said, I have two college aged daughters. So they they feel their world weary. But, you know, you'll have more reason for cynicism and hope, you know, down the road, but it's all about money. Do energy is a major natural gas company. And one of the biggest shocks to Duke and Duke investors in the last couple of years was the cancellation of the Atlantic coast pipeline mean that the multi billion dollar pipeline intended to feed in large part North Carolina gas plants owned by Duke Energy, that ever hermetically sealed money machine where we sell gas to ourselves, we burn gas in our own gas plants. All we got to do is keep bumping up the rates on our customers and we're just a money making machine and I look at their investor reports. What do they say to investors, it's all about hey, we're making great returns and we're gonna make even better returns when we get that pipeline completed. And these additional gas Plants done. And so you have Randy speaking to you. You have the CEOs speaking to heavy hitter investors in on Wall Street saying bank on us, because we got a, we've got an unbeatable plan. It's all built around gas. And we are where you want to put your money. And so it's strictly about money. If do CAD, a lock on battery storage, manufacturing, and there was a way for them to make big returns in battery storage, then their investor reports to do all about battery storage and why we have to do it. But this is where it's so important to change their financial motivations. Because right now they're lined up against climate activists lined up against common sense, but they're not lined up against money, because right now they are making great money on this game.
RISHAB
Do you think that if, if we say that Duke does everything, right? They embrace battery storage and renewables, they shy away from carbon capture technology? Is that leave Duke in a world where they just can't earn a profit with our current business incentives? And just my next question would be like, can you anticipate Duke profiting if it changes his business model? And if it adapts to these renewables
WILLIAM
Great question, and the way I see things playing out, inevitably, whether it's pulling teeth or not, is all of these big corporations are basically owned by holding companies. Meaning do I was telling you, Duke owns a solar company, I don't know, Dukes whole portfolio, but it's pretty extensive. And if they keep a mindset that every portion of our portfolio has to be making good money all the time, that's kind of an impossible standard, because we were just talking about them growing that solar company by a factor of 10. Well, if you look at it in the big picture, Dukes just one part of the bigger puzzle owned by a giant holding company. Well, if it's individual customers, like you and me that own the solar and the batteries, then obviously they're not going to make money there. But they could make money selling us with their other company, rec solar, mid rack you, you grow by a factor of 10, putting solar all over North Carolina buildings. Duke Energy is a investor on utility shrinks in terms of how much money it makes, but under the whole umbrella, they're now making good money in a couple of places where they weren't. And so collectively, they're still doing fine. But the utility is shrinking, it is no longer this ever growing money making engine, it's more of a maintenance role, meaning we want to have the transmission system, we want to have the distribution system, we want to move all this solar and battery storage around so somebody's got to own it and maintain it, maintain it and keep it up that's about it. Maybe we don't need you to do a lot more than that. We don't want your gas plants don't build any more gas pipelines. We don't need any more transmission lines, because everybody's putting the power where they use it. So we don't need to expand that either. And so from a public interest and citizen standpoint, it's in all of our interest for the investor and utility to shrink a lot, but they're smart. And they will know where to go for business opportunities that can make collectively their business strong. They just why do that if you don't have to. I mean, if you own the politics of a state, why make the effort to diversify when you control the situation, but when you no longer control the situation, they will adapt, they will do just what we're talking about right now. They just don't have to do it yet.
RISHAB
I love what you just said, Why do it if you don't have to? You know, that's that's kind of how it comes down to. to William, there's no feasible way for him to imagine Duke Energy as becoming truly sustainable with our current economic conditions. In his words, we have to rethink what we want out of energy isn't just about profit in the short term. Can we include citizens in decision making? If we can't answer those questions, Duke may never be a truly sustainable company.
RYAN
Well, there's so much more from our conversations with William and Randy that we wish we could share. We hope that this debate shed some light on the behemoth controlling my energy supply, and possibly yours at home. We got to say, it's hard to be objective in the case of Duke Energy. There are multiple instances in which environmental groups have lashed out at the utility for environmental and justices, excessive control over public policy, and other decisions that hurt certain communities. However, in terms of carbon neutrality, doobies doing more than many American counterparts like Exxon, the question becomes, how much is enough and how fast is fast enough
RISHAB
to Randy flexibilities key and natural gas in emerging technologies are the best ways to get there. To William. We need commitments to existing clean technologies now, and Duke deliberately chooses not to, because it's not in their financial interest. One of the things that William touched on at the end was Duke power, and specifically, how powerful it is North Carolina. When we talk about energy and climate, we have to talk about politics. And that's why the next episode is a special look at Duke Energy, politics, and how carbon neutrality can be achieved, or prevented through Duke in the state legislature. I'm Russia. And I'm Ryan. Thanks for listening, and we hope to see you next time.
KATHERINE
Thanks so much for tuning into this episode of operation climate. Make sure to subscribe on Spotify, Apple podcasts, Google podcasts, and anywhere else that you find your podcasts. In order to stay updated about future episodes. Visit our website at bit.ly/operationclimatepodcast for a full transcript of this episode. And for more information and links that you can explore to learn more about this topic that we covered today. Follow us on our socials, we are @operationclimate on Instagram. And mostly we want to hear from you. So write a review on Apple podcasts that would help us so much, and send us your feedback and your messages through our website. Email us, you can dm us on Instagram, you can fill out our feedback form which is on our website. And if you're a student listening to this podcast, head to our website to fill out our students stories form to get the chance to have your story and voice featured on a future episode of operation climate. Thanks so much and we hope you join us next time. See ya.
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