North Carolina’s Current Energy Environment

North Carolina’s energy mix includes nuclear energy (32 percent), natural gas (30 percent), coal (26 percent) and renewables (10 percent) based on 2017 data from the U.S. Energy Information Administration. In the future, coal will decline as a percentage of North Carolina’s total energy mix due to plant retirements. New coal-fired generation capacity is much more expensive to build and more difficult to site and permit than natural gas or renewable facilities.

North Carolina has a highly regulated monopoly-controlled electricity market where investor-owned utilities (IOUs) make most of the decisions about where our power comes from. North Carolina does not have a free market where energy technologies can enter and compete on price and quality. Third parties then cannot sell energy in North Carolina directly to businesses and consumers unless it is within a small window of opportunity made available in the energy statutes. There has been some movement to restructure North Carolina’s energy market, but nothing has been changed yet. North Carolina’s military installations operate within this statewide environment and focus their energy initiatives in accordance with the state regulatory environment.  Any energy projects – including renewable energy projects – are coordinated with the military to ensure they do not conflict or interfere with the military mission.  

North Carolina’s energy mix is influenced by actions at the state level. North Carolina has passed two critical pieces of energy legislation in the past decade that frame its regulatory climate:

• The 2007 Renewable Energy & Energy Efficiency Portfolio Standard or SB 3, the first portfolio standard in the Southeast to require utilities to purchase renewable energy sources; and,
• The 2018 Competitive Energy Solutions for North Carolina or HB 589, which updated and expanded North Carolina’s energy landscape. HB 589 has provisions for solar leasing, a solar rebate program, a community solar program, and the creation of a program for large businesses, universities, and the military to directly procure renewable energy (the Green Source Advantage program). Finally, HB 589 requires Duke Energy to procure 2,660 MW of renewable energy over a 45-month window.

Finally, in addition to these two landmark state energy laws, in October 2018, Governor Cooper signed Executive Order 80, which outlined North Carolina’s commitment to address climate change and transition to a clean energy economy. The N.C. Department of Environmental Quality developed clean energy plan on how to meet the Executive Order. Finally, the N.C. Department of Transportation published North Carolina Zero Emission Vehicle (ZEV) plan on how to increase the number of zero emission vehicles (ZEVs) to at least 80,000 by 2025.

Through North Carolina’s commitment to creating a cleaner energy future, North Carolina’s clean energy industry now includes 1,717 clean energy firms and 43,238 clean energy jobs.  In addition, North Carolina has $14.2 billion in annual revenue, an increase of 124 percent from 2016-2018. The majority of those renewable energy investments were made in the state’s most economically distressed counties in the rural parts of North Carolina. 

There are several other important facts in North Carolina’s energy landscape:

• Through the second quarter of 2020, North Carolina ranked second nationally, after California, in the total amount of installed solar power on the grid, primarily with utility scale solar facilities
• North Carolina has the Southeast’s largest wind facility, which has 104 tall high tech wind turbines in the northeastern corner of the state; and,
• Several North Carolina municipalities and counties have announced 100 percent renewable energy goals such as Asheville, Charlotte, and Wake County.

North Carolina’s prominence as a solar state includes national caliber solar developers and a varied supply chain including module and array manufacturers.  The state is also home to a smart grid sector with over 1,000 jobs, micro-grid demonstration, advanced training programs, and highly regarded product manufacturing and research entities.  North Carolina has a prominent building efficiency sector with over 11,000 jobs, many LEED certified buildings, and strong growth potential.

North Carolina launched the Offshore Wind Study in part to fulfill the requirements of Executive Order 80. The study will address the role wind energy is going to play in North Carolina’s energy mix by 2030 and beyond and is expected to be completed by early 2021. Avangrid Renewables is currently developing the Kitty Hawk project (one of the three best sites for offshore wind energy in North Carolina) at what is the first offshore wind lease area to be secured off North Carolina for a capacity of 2 GW but there are more opportunities for offshore wind leases. There has been concern about how the military and wind energy coexist but the NCMBC will actively engage in discussions on this topic.

The NC Offshore Wind Supply Chain Assessment has launched an Offshore Wind Supply Chain Registry database that serves as a platform to promote companies offering offshore wind products, services and training. This will also help provide offshore wind developers and OEMs easy access to the North Carolina supply chain.

Companies may join this publicly available supply chain registry by entering business information through the brief survey at the following link: https://public.nccommerce.com/OSWRegistry.