Dive Brief:

• The North Carolina Utilities Commission (NCUC) is reviewing the rates that utilities in the state pay for renewable energy, with an emphasis on contracts for 5 MW or less capacity.
• The NCUC currently sets rates every two years based on the avoided costs of buying other types of generation. Solar facilities with 5 MW or less capacity are eligible for the utilities' "standard offer," based on avoided costs, with no negotiations needed.  
• Duke Energy, the state's largest utility, offers 15-year power purchasing agreements at the "standard offer" rate to renewable power plants 5 MW or less. Solar advocates want to increase the contracts to 20 years with the "standard offer" price for all plants 10 MW or under.

Dive Insight:

Today, Duke has almost 750 MW of renewables capacity under contract, but that number could soon rise to more than 3,500 MW of capacity as 2,800 MW of pending projects come online. Duke wants to place a cap on the size of the facilities it can extend its "standard offer" at 100 KW or less and the length of contracts at 10 years. 

The current limit "reduces [Duke's] ability to manage growth in [its] systems on an orderly basis, and reduces the commission's ability to carry out its responsibility to assure that consumers have reliable power at the least possible cost," said Kendal Bowman, Duke Energy VP of regulatory affairs.

Solar advocates say the rate should be improved to take into account hard-to-quantify "avoided costs" like public health benefits and carbon emission reductions.

The NCUC Public Staff does not foresee a change to the 5 MW limit.