N.C. governor vetoes bill that would have delayed clean energy goal

State legislators pushing to unravel North Carolina’s climate law say their bill will give utility Duke Energy more leeway to build new gas and nuclear power plants and save its Tar Heel customers billions of dollars.

But Gov. Josh Stein disagrees: He vetoed Senate Bill 266 on Wednesday, prompted by data showing that the legislation would cost households and slow the state’s energy buildout. The GOP-sponsored measure would repeal a requirement that Duke slash carbon pollution 70% by 2030 compared to 2005 levels, while leaving a 2050 carbon-neutrality deadline intact.

“This summer’s record heat and soaring utility bills has shown that we need to focus on lowering electricity costs for working families — not raising them,” Stein, a Democrat, said in a statement. ​“My job is to do everything in my power to lower costs and grow the economy. This bill fails that test.”

In issuing his veto, Stein pointed to a new study from researchers at North Carolina State University, which builds on projections from the state customer advocate, Public Staff. That modeling showed SB 266 could cause Duke to build less generation capacity over the next decade, just as electricity needs are expected to surge.

That means Duke would have to lean harder on aging plants and burn almost 40% more natural gas between 2030 and 2050, experts at N.C. State University say. Under a worst-case but plausible scenario for gas prices, customers could pay $23 billion more on their electric bills by midcentury as a result.

“As our state continues to grow, we need to diversify our energy portfolio so that we are not overly reliant on natural gas and its volatile fuel markets,” Stein said.

A complex measure that’s faced little public debate, SB 266 easily cleared both chambers of the Republican-controlled General Assembly in June with a handful of Democratic votes. With Stein’s action, advocates now turn their focus back to state lawmakers, who are on break for at least another week. The GOP has the three-fifths majority needed to override the veto in the Senate, but is one member shy of that margin in the House.

“Governor Stein is championing working families all across North Carolina who would be harmed by this new law,” said Will Scott, Southeast climate and clean energy director for the Environmental Defense Fund. ​“Legislators should reconsider the harmful consequences of this law for the working families in their districts.”

The N.C. State study underscores a surprising finding from Public Staff’s modeling: SB 266 does little to prepare North Carolina for ballooning electricity needs expected from an influx of data centers, manufacturers, and new residents. In fact, removing the 2030 goal would prompt Duke to build 11,700 fewer megawatts of new power plants in the next decade than its current plans.

“In talking with legislators, I found that almost all of them emphasized economic growth and the need for power generation to meet that demand,” said Scott. ​“But Public Staff’s analysis found that the most likely short-term impact of SB 266 is to build less new generation and storage and instead to lean harder on aging coal and gas facilities.”

The Public Staff forecast shows renewable energy would be the main short-term casualty of SB 266, just as its backers intend. By 2035, Duke would construct 7,200 fewer megawatts of solar and battery storage, and no offshore or onshore wind farms whatsoever — a 4,500-megawatt decrease compared with the status quo.

But new ​“always-on” nuclear and gas resources — the same ones SB 266 champions seek to promote — would also suffer. Without a near-term carbon reduction deadline, Public Staff says Duke would develop just 300 megawatts of nuclear power in the next decade, half as much as it currently plans. The utility would build 1,400 fewer megawatts of large, efficient combined-cycle gas units.