North Carolina governor signs solar bill, targets wind moratorium with executive order

Dive Brief:

North Carolina Gov. Roy Cooper (D) signed into law a solar bill (House Bill 589) with an 18-month wind energy development moratorium on Thursday, but sought to mitigate the moratorium by issuing an executive order directing state officials to continue planning for development.
The measure, a result of intensive negotiation between utility officials and solar interests, establishes a competitive bidding program and a solar leasing program allowing customers to work with private parties. It also opens a proceeding over the state's net metering policy.
The bill passed the state House as a solely solar measure, but Republican Sen. Harry Brown tacked on a moratorium on wind energy development, which he said bought time to study the facilities' impact on military installations. The bill cleared the Senate and House with enough votes to potentially override a veto from Gov. Cooper.

Dive Insight:

North Carolina has the second-most installed solar capacity of any U.S. state — much of it coming from the state's favorable interpretation of the Public Utility Regulatory Policy Act (PURPA), which requires utilities to purchase generation from certain facilities.

The onslaught of solar growth compelled Duke Energy to push a bill that would reform the state's approach to PURPA and allow the utility to participate in competitive bidding against solar developers.

The proposal met backlash from solar advocates, who said bill would slow their sector's growth. But the stakeholders, typically at odds with each other, embarked on months-long arduous negotiation and hammered out a measure designed to ensure future solar growth at rates more amenable to Duke.

Those efforts included lowering the state's avoided cost rate, but kept the 20-year length for power purchase agreements under PURPA. The bill also opened access to solar developers for lower-cost financing and set a solar deployment target of 6,800 MW by 2020.

The bill cleared the House, but ran into problems in the Senate when Sen. Brown added a last-minute amendment to stop wind energy development for four years, which was later whittled to 18 months.

Wind advocates said the moratorium would cost the state billions in rural investment, but lawmakers opted to preserve the solar compromise. The House passed the amended bill 66-41 and the Senate 36-4.

Observers were unsure how Gov. Cooper would proceed, having praised the compromise bill before the addition of the wind amendment.

If he vetoed the bill, stakeholders said he could damage the fragile compromise between typically adversarial stakeholders and lawmakers could potentially override it. If he signed it, he could damage the wind industry in the state.

Cooper chose a third path, signing the bill and immediately issuing a separate executive order that would attempt to mitigate the impacts. The order directs the Department of Environmental Quality to keep recruiting wind energy investments and continue with the permitting and application process. His intent is to ensure wind facilities will be able to come online quickly after the moratorium expires.

"This bill is critical for the future of significant increases in our already booming solar industry," Cooper said in a statement. But "I strongly oppose the ugly, last-minute, politically motivated wind moratorium. However, this fragile and hard fought solar deal will be lost if I veto this legislation and that veto is sustained."