Duke Energy's Position on Renewable and Clean Energy Mandates
As America’s electricity appetite continues to grow, it is critical that both government and the free market come together to support policies that encourage the development of clean energy. Duke Energy believes low- or zero-emission technologies will play an increasingly important role in meeting the nation’s future energy demand, particularly as the cost of these technologies become more competitive.
Public policies – such as state-level renewable and clean energy standards, which have been enacted in the majority of states – have served to jump-start deployment of critical technologies. These policies provide utilities and non-utility energy providers with the certainty necessary to make investments in new energy infrastructure. As long as they are practical, affordable and based on the goal of adding low or emissions-free electricity generation, these standards can help our country transition to a cleaner and more sustainable energy future.
We believe that because state legislatures understand the clean energy resources available in their respective regions, they are best qualified to evaluate if and how renewable and clean energy portfolio standards should be implemented in their states. A federal “one-size-fits-all” approach, on the other hand, might fail to recognize that what works in California or Texas might not work well in Ohio or North Carolina.
Policymakers should use the following principles when developing and implementing new energy standards and goals:
Begin with sensible initial energy requirement levels that gradually ramp up over time.
- Set goals that are based on an informed, region-specific resource assessment.
- Engage a variety of stakeholders in the goal-setting process, including utilities, clean energy developers, consumer advocates and environmental experts.
- Afford electricity providers the time they need to efficiently deploy the necessary capital and infrastructure to comply with new requirements. Phasing in requirements over an extended period of time also allows for strategic adjustments to the standard or goal, if necessary. Aggressive requirements phased in over a short period of time often result in inefficient and unsustainable projects.
- Be fair. Require all electricity providers to participate in a renewable mandate, regardless of size or electricity sales.
Protect and inform customers
- Protect consumers from excessive price spikes by introducing clean energy requirements over an extended period of time.
- Recognize that mandating specific amounts of electricity be obtained from specific technologies or locations can increase costs to the consumer.
- Incorporate safety-valve mechanisms, such as cost caps, to protect consumers.
- Conduct periodic program reviews to assess the impact on customers, consumer behavior, economic development and infrastructure deployment.
Allow compliance flexibility
- Allow electricity providers to use a host of clean energy technologies to meet requirements.
- Recognize the nascent national market for Renewable Energy Certificates (REC), and craft a standard that also encourages the development of a competitive local REC market.
- Allow reasonable REC banking and borrow-forward provisions to facilitate better planning and serve as a cost-control mechanism.
- Consider incorporating all low- and zero-emission technologies, like clean coal and nuclear, into the goal.
- Promote conservation and energy efficiency efforts, placing energy efficiency on equal footing with new generation. We maintain that the best power plant is the one you never have to build.
Ensure appropriate and timely recovery of compliance costs
- Allow electric providers timely recovery of costs, plus an allowable return on new supply acquisitions that are used to meet compliance obligations.