US energy company faces standoff with regulators in battle to shut down coal plant - The Straits Times

US energy company faces standoff with regulators in battle to shut down coal plant – The Straits Times

WASHINGTON (Bloomberg) – US energy company Duke is preparing for a confrontation next week with regulators over its plans to speed up the shutdown of its last six coal-fired power plants in North and South Carolina – a plan already rejected by the South Carolina utility regulator.

The regulator’s meeting on Tuesday (May 31) will also consider pleas from a coalition of environmental groups urging the South Carolina Public Service Commission to reconsider its December decision ordering Duke Energy to keep coal plants open until 2039 – more From about a decade ago. A preferred plan stipulated by the tool.

The conflict threatens Duke Energy’s preferred path to accelerate coal-fired plant shutdowns by 2030 and advance carbon reduction goals.

The facility needs approval from both North Carolina and South Carolina to follow through on its ambitions to close factories a decade ago, raising the risk of regulatory divergence between states.

Regulators in South Carolina haven’t explained why they want the factories to run longer. A representative said the commissioners could not answer questions about the issues before them.

“We are disappointed by the panel that is imposing the least proactive course of action away from coal generation, as it poses unnecessary risks to customers and our system,” Duke Energy representative Erin Colbert said in an email.

Risks include getting enough coal and maintaining access to capital given investors’ premium on decarbonization.

The dispute between Duke Energy and regulators is an example of the difficulties that can arise when trying to transform a global energy system dominated by fossil fuels to one that embraces less polluting energy sources, with decarbonisation, cost and reliability that sometimes conflict.

Disconnection between South Carolinas is rare: Utilities and regulators often agree on the best path forward, as advocates of clean energy push to stop using coal and increase renewable power generation.

“We don’t know where that choice came from,” Kate Mixon, an attorney with the Southern Environmental Law Center, said in an interview about South Carolina’s decision. “I felt like the committee was playing another sport.”

A possible explanation for the decision is cost: Duke’s preferred plan is expected to cost about US$83 billion (S$122.2 billion) while the alternative plan selected by the South Carolina commission would cost around US$79 billion.

Duke’s preferred path also includes building onshore wind and adding about 50 percent of solar by 2035.

Meanwhile, the North Carolina regulator is on the fence about the accelerated shutdown of coal plants, saying such plans need further study. The position comes after state lawmakers passed a law last year requiring a 70 percent cut in carbon emissions by 2030. President Joe Biden has set a US goal of providing 100 percent carbon-free electricity by 2035.

“We would like to see consistency across states,” John Burns, an attorney for the Carolinas Clean Energy Business Association, said in an interview. He described the decision of regulators in South Carolina as a surprise. “I don’t envy (Duke)’s job if they have to deal with different regulators going in different directions.”

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