Many businesses are capitalizing on a growing clean tech opportunity in North Carolina- renewable companies, city developers, and venture capitalists. Large energy providers are often left out of the picture, perhaps as they’re perceived as heavily invested in fossil fuels. However, this may not be the case with the coming energy transformation.
Below, two Duke Energy representatives provide insight on Duke’s sustainability efforts. Elizabeth Bennett is a manager of the Distributed Energy Resources Group, and Hilary Davidson is Duke Energy’s Director of Sustainability and Community Affairs. Both shared their perspective on the role of sustainability in energy supply.
This Q&A explores the challenges and opportunities that renewables present for Duke Energy. The representatives also discuss Duke’s future plans to expand its sustainability efforts, bringing awareness to shifts in the energy market. (These interviews have been edited and condensed for clarity.)
Q: What trends do you see in renewable energy policy and the growth of big businesses? Do you have any insight on the future nature of the renewable industry ten years from now?
Elizabeth Bennett: I think questions about policy incentives are going to become less and less important because the economics is working.
Now it’s working differently for different customers. I know Duke would like to get to a point where we are able to connect customers with affordable solar options — and by customers I mean your big-box retailers but also your residential customers.
If you look over the border on what we’re doing in South Carolina, there’s a good example. Through legislation we have a way to invest and provide customers options for solar engagement. And we’ve rolled out a rebate program for rooftop and ground-mount installation on customer properties.
We’re also going to be rolling out a shared solar program. So for folks that live in apartment complexes, or that might not have a roof that’s conducive with solar, or that might not want to deal with the operations or a homeowner’s association that doesn’t like solar on the roof, then they can participate in the shared solar concept, or community solar.
So those are the kinds of things we at Duke would like to be able to invest in and provide for customers in the future. And I think there is going to be a pathway to do that. Now every state will be a little different, and that’s where policy comes in.
I would be careful not to look at a tax crediting expiring and say, ‘It’s the end of solar.’ And I think some people did, but it’s not slowing anything down. And especially with the federal government’s decision in the end to extend the ITC — that was significant. And I don’t think that’s being talked about enough.
And the only other thing I’ll say, and it’s somewhat obvious sometimes — a lot of people tend to forget that North Carolina ranked number two last year in terms of solar growth. And we are really proud to have been part of that.
Last year we constructed four large-scale solar facilities totaling 141 megawatts, and late last year we announced another 75 megawatts. And so our pace isn’t slowing down.
And I think as we look towards the future, if there’s anything to take away, it’s that we believe the utility has a big role to play in investing in solar and other renewable resources: bringing those to customers in an affordable and a reliable way, and growing them as part of our portfolio, but also balancing with the other resources we have and the other demands we have on the system.
Q: Why does sustainability make sense for Duke?
Hilary Davidson: It makes so much sense. It makes sense socially, economically, and environmentally. People always think, oh, it’s going to cost money to do sustainability things.
It really is all about long-term— making good business decisions that are good for the environment and good for people. It really saves you money.
One of the key things we really encourage folks internally— when we talk about sustainability, you start thinking differently when you think about conserving those resources. (Employees) think of new processes, they get very efficient, and they come up with new ideas. We have saved millions of dollars with employees with new innovative approaches of how they do their job.
And we have a group we call the Sustainability Corps, we kind of named it after the Peace Corps. And it has been really fun. So they have gotten energized and really saved so much money through their projects.
So you can reduce emissions or water and also costs and your budget. We quit tracking the numbers because it’s so embedded now because it’s so much a part of the culture.
Q: How much of these sustainability efforts are a reaction to the growing environmental movement and pressure from your customers for more responsible practices? Does this make your efforts relatively recent?
Davidson: We’ve been doing this a long time. I would say it’s not a reaction for us, and I can say that so passionately.
I’ve been doing this for 30 years at Duke. I helped write the first environmental report, and that was in 1993. Duke created the first environmental science center of all of the utilities in the 1970s.
So they’ve had a huge environmental focus for a long time. So that first external environmental report was kind of unique for utilities. That was not something that was typically done way back when.
So the whole movement changed. It was environmental for a while, and then social responsibility started, and then the name sustainability actually formalized — we formalized a corporate sustainability office in 2008. So we formalized the name at a certain point, but it’d been there in one form or fashion.
One of the things I’d like to say, you know, J.B. Duke, the founder of Duke Energy, started the Duke Endowment, and this was back in the 1920s. When he started the power company, he said, hey if I’m going to make money from this industry, I’m going to also give money and philanthropy back to the Carolinas and the community, which to me is sustainability.
So he started the Duke Endowment, which today is one of the hugest endowments, and it gives money to the Carolinas. To me, the foresight of that is just part of that whole philosophy.
Q: What opportunities and challenges have renewables presented to Duke?
Davidson: I think it has been another great asset to add to our diverse fuel mix. I think having diverse fuel options is our biggest asset and will continue to be our biggest asset in the future.
I think we always want to have a diverse fuel supply. We don’t ever want to go a single source of anything. I think just like a diverse stock portfolio, it keeps you healthy, and serves you well over time, so should a diverse fuel portfolio.
I’ve been in the industry long enough to see — I was around when gas prices went sky-rocketing, I was standing at gas lines in the 70s to fill up my gas tank, I’ve been around when Chernobyl happened, when Fukushima happened, I’ve been around when natural gas prices spiked. I’ve been around now with the shale-gas revolution, with how cheap gas is now.
You know, solar is fantastic. But I don’t know, something could happen with solar that we don’t even know yet. Sometimes we think everything is glorious, and sometimes things happen. So I guess keeping all options on the table is good.
The challenge of renewables for now, I would say, is storage. And from what I understand right now, the storage technology is not totally there yet, and also there is the expense of it. The sooner we can get there at an affordable rate is awesome. Understand we own about 15 percent of the utility-scale storage in the United States right now.
The other thing with the challenge with renewables is that it doesn’t always match the peak. And I think people don’t always understand that, it’s not always there at the right time. It’s intermittent, and that’s an issue as well.
Q: A quote from Duke’s 2014 sustainability report- “closing 40 coal-fired generating units… We’ve also invested more than $4 billion in wind and solar facilities and, in 2014, we committed $500 million to expand solar energy in North Carolina.” Oftentimes, there is a negative perception surrounding Duke because a large percentage of your generation is from coal. Their comment might be you could do better to invest more in renewables and efficiency. What would be your response to that?
Davidson: I guess what I would say to those people is please consider the entire population in North Carolina and the needs of your neighbors in this state.
Our customer base is not a high-income customer base. Those people cannot afford to have all of that power shut down and do really expensive renewables. You can’t just transition and shut everything down and pay off-site prices right now.
That wouldn’t make economic sense. Just like anything you need to transition. The path you are on is transitioning to a lower-carbon economy and future.
And that is the pathway underway; and you do it sensibly, and in a way that is not hurting people. You do it in a smart and economic way as those prices come down and as technologies come up.
One of the things with Duke — our stakeholders are everybody. So they’re all at complete different ends of the spectrum, and at the end of the day we have to keep those lights on for everybody.
We respect all of the different viewpoints that there are, truly. We do have the extreme activist end of things, where they want everything totally green right now. If you look at the entire population it’s actually not a high percentage of what most of customers actually want.
Most of our customers say, we really want an affordable bill because we’re just trying to survive, and I need to stay in business in this state. So there are some heavy social issues that are going on. And that’s obviously very critical.
There are health issues, there’s social issues, education issues, which is all part of sustainability. Those are equally important as the environmental and green part of it. And so that’s what you have to think about.
Really when you think triple bottom line, you need to be thinking of all of those in the long-term, and not doing a drastic reaction to just one component of it and sacrificing other things. People might not like you, and you might get beat up for it. But you still need to do the right thing to make sure no one is getting hurt in the long-run.