Dive Brief:

• Duke Energy on Tuesday announced plans to add 8,000 MW of wind, solar and biomass by 2025, which would bring its total renewables portfolio to 16,000 MW.
• The utility currently owns or purchases around 57,000 MW of total energy capacity, which puts it at about 14% renewables. Duke is aiming to achieve net-zero carbon emissions by 2050.
• While many applaud the progress Duke has made to reduce carbon emissions, critics also see fault in the utility's decision to continue relying on natural gas resources and want to see a greater investment in energy storage to enable more renewables. "Our own modeling in North Carolina indicates that there may be a cheaper, cleaner solution to get Duke on track," Amanda Levin, climate and clean energy policy analyst at Natural Resources Defense Council (NRDC), told Utility Dive.

Dive Insight:

Duke says operational limitations of intermittent resources and energy storage, and significantly higher costs associated with adding more batteries, have prevented it from being as aggressive as critics would like.

The company laid out its vision and tallied its climate progress Tuesday in two new documents: a Sustainability Report focused on company performance, and its 2020 Climate Report which sketches out a path to net-zero emissions.

In 2019, Duke's regulated electric utility generation was 31% gas, 31% nuclear, 24% coal and 5% renewables. Looking ahead to 2030, Duke sees gas generation rising to 42%, nuclear at 30% and renewables at 14%. Coal will still make up 11% of its generation, the utility says.

While fossil fuels will still account for more than half of Duke's generation, the utility says it remains on track to achieve a 2030 goal of reducing CO2 emissions from electricity generation by at least 50% from the 2005 baseline.

Duke serves customers in six states, with the largest share in North Carolina. 

NRDC's modeling shows that North Carolina could cut emissions by over 60% by 2030 through greater coal retirements, increasing solar capacity five-fold, ramping up energy efficiency programs to achieve 1.5% annual savings, and deploying 2.4 GW of battery storage.

"We hope that Duke continues to analyze solutions that better incorporate demand-side investments, like energy efficiency, rooftop solar, and demand response, as an alternative to a continued buildout of new gas," Levin said.

By 2050, Duke says renewables will make up the largest share of its generation at 36%. Gas will drop to just 6%, and will shift from providing baseload power to instead meet peak demand.

Existing nuclear resources will account for 28% of generation, while the utility plans to rely on a new class of resources, Zero-Emitting Load-Following Resources (ZELFR), for 30% of its generation. Those could include advanced modular nuclear reactors and carbon capture retrofitted onto gas plants.

Those technologies are not commercially available yet, however, opening Duke to allegations of an indifferent approach to renewables and battery storage.

Criticism over technology, storage decisions

"Wishing that such technologies actually existed and giving them a cute acronym doesn't make it so," Synapse Energy Economics CEO Bruce Biewald told Utility Dive. "And basing a climate plan on them is neither prudent nor reasonable."

Duke officials say they anticipate strong advances in ZELFR technologies across the next few decades, and say they are open to course adjustments.

"30 years from now, who knows what technology and advances we'll have," Duke Climate Policy Director Vicky Sullivan told Utility Dive. "We hope the technologies we have here pan out, and we hope they become economical."

Biewald said the utility is "giving short shrift to currently available and low cost renewable resources like wind and solar," and could speed the development of carbon-free generation by adding more batteries to its system.

Duke has about 50 MW of energy storage around the country, and the utility's short-term plan calls for 400 MW of battery storage over next five to 10 years.

Duke is "bullish on the future of battery storage," according to Zak Kuznar, the utility's managing director of energy storage development.

"The future needs to be where batteries provide more than grid reliability and ancillary services such as voltage support — they need to delay or eliminate altogether the need to build future peaking units. That's how you move to a low-carbon world," Kuznar said in an email.

Duke's analysis included a "no new gas" calculation to stress-test its climate projections. The utility's climate report says that while energy storage can help address the capacity and energy gap created by retirement of coal units, "installation and operational challenges arise as we attempt to rely on current commercially available storage technologies to provide intermediate and baseload capabilities."

And even if operational concerns are overcome, Duke says the incremental costs of achieving net zero emissions under a no new gas scenario "would increase by three to four times" compared to adding gas resources.

But Biewald said those assertions do not hold water.

"Other systems are way ahead of this in terms of renewable energy, and Duke's whining about the limitations and cost of storage are not supported anywhere in the document," Biewald said.

Duke officials defended their plan, while acknowledging it could change.

"It could be that storage advances greatly and becomes easier to build at large scale," Sullivan said. "This is a future look, based on what we know today. And one thing we know is that things will change. Costs will change."