MountainTrue Raleigh Report | June 12, 2017

Last week, after months of speculation, private meetings and a lot of rumors on Jones Street, the Republican-controlled House of Representatives rolled out and quickly approved a bill to rewrite the laws that shape clean energy policy in North Carolina.

House Bill 589 is enormously complicated — and enormously important — as it will guide the development of clean energy in our state for years to come. Countless communities, thousands of jobs, millions of people and billions of dollars will be impacted by HB589. We won’t try to summarize it here, but you can find a good, plain-English overview of the bill here.

A legislative summary of the bill can be found here.

On the positive side, HB589 requires Duke Energy to obtain significant, new solar power over the next 4 to 5 years. It also includes a “Green Source Rider” to allow companies to more directly procure clean, renewable energy. There is also a new framework for a community solar program, a new rebate for rooftop solar and the option for some consumers to lease solar electric systems to power their homes and businesses. These are all programs that clean energy advocates have wanted for years.

That said, the bill is also deeply flawed. For example, after the initial period in which Duke Energy is required to procure significant new utility-scale solar power, HB589 gives the company far too much control over both large solar farms and the creation of rooftop solar on houses and other residential buildings. Expansion of solar energy into rural communities will be very limited because of the way the bill is written.  Furthermore, the rebates for rooftop solar and the solar leases are artificially capped and will help too few people.

Despite these and other flaws, the bill garnered bipartisan support (including all WNC Democratic representatives and most WNC Republicans) and endorsements from the state’s largest clean energy industry group, the NC Clean Energy Business Alliance, and the state’s largest clean energy advocacy group, the NC Sustainable Energy Association. The bill was also endorsed by Democratic Gov. Roy Cooper and many – though not all – environmental groups, including the League of Conservation Voters.

For our part, MountainTrue reluctantly endorsed the bill as worthy of legislators’ support, despite its significant problems. Other organizations, such as Appalachian Voices and the NC Clean Air Coalition, opposed its approval. The Sierra Club and the Southern Environmental Law Center took a neutral stand on the bill to neither support nor oppose it.

Whatever position these organizations have taken on HB589, we all share an ambivalence about the bill and a deep frustration that GOP support for clean energy is so weak that this bill can be considered a win. No wonder that those who oppose HB589 are quick to acknowledge that there are parts of it that justify voting for it, and those who support it are just as fast to agree that there is much to oppose.

So what is going on with this bill – and in the legislature – that has left so many supporters of clean energy so ambivalent about HB589?

Answering that question begins with understanding that the clean energy industry — and its supporters — had a very weak hand going into the negotiations that led to the House’s approval of HB589.

For several years, the policies that made North Carolina a leader in clean energy have been under attack by many, though not all, GOP lawmakers as well as energy companies and conservative advocacy groups (many of them funded by fossil-fuel interests like the Koch brothers). The result has been a steady elimination or weakening of many of the state laws and policies that incentivize the use and production of clean energy. The Renewable Energy Investment Tax Credit, for example, was allowed to expire in 2015. Clean energy supporters have spent years fending off GOP attacks on the state’s Renewable Energy Portfolio Standard (REPS), which requires Duke Energy and other power companies to buy or produce a significant portion of their energy from sustainable sources.

It’s worth taking a moment to consider Duke Energy’s part in this issue more specifically. The company has been complaining to lawmakers for years about integrating new solar onto the power grid and demanding that the legislature give it more control over where new solar generating capacity gets built. Duke has also created difficulties for the solar industry by slowing down the interconnection process for new solar farms and threatening to upend these successes before the N.C. Utilities Commission.

Then there is the Trump Administration, which is likely to launch its own assault on federal clean energy policies — many of which drive North Carolina’s clean energy efforts.

All of these challenges create uncertainty in the clean energy industry and its market in North Carolina. Facing that uncertainty and the very real possibility that the policy environment will get even worse, the clean energy industry chose to lock in what it could get in HB589 and stabilize the market for the foreseeable future.

For MountainTrue, we judged the clean energy industry’s support for the bill as the correct strategy for making the best of a very bad political environment. We also expect that Gov. Cooper’s appointees to the Utilities Commission (assuming they are approved by the legislature) will prioritize the sustainability of the state’s power supply. This would help soften the impact of the new bill. Additionally, we hold out the longer-term hope that redrawn and constitutional legislative districts will help encourage more legislators to represent all North Carolinians rather than a small but outspoken group of ideologues on energy issues. So this bill is not likely to be the last clean energy bill we see, and we hope future comprehensive bills will be more favorable.

In the short term, we’ll be working to make sure HB589 does not get worse. (We have little confidence it will get better as the clean energy industry’s support in the legislature is strongest in the House, where the bill originated.) There is no guarantee that the compromise bill worked out in the House will go unchanged in the state Senate, which was not included in the negotiations that led to HB589.

Right now it is not clear how the Senate will react to the bill or even if it will take it up this year. Attempts to amend the House compromise bill could lead to one or both of the bill’s two main stakeholders, Duke Energy and the Sustainable Energy Association, to reconsider their support. Renegotiating HB589 would likely be time-consuming and delay the end of the legislative session, which GOP leaders say will end in the next few weeks.

Perhaps the most likely outcome on HB589 is that the GOP-controlled Senate will either approve the bill as written in the last weeks of this session or wait and take it up during next year’s short session, which begins in May.

Finally, we’d be remiss if we didn’t point out that clean energy supporters should never have been forced into such an untenable position on this legislation. Those legislators who support this bill and Duke Energy have asked clean energy advocates to choose between an imperfect and flawed bill or a much worse policy. Our state and its future are worse off because of their lack of vision.

There is still time to tell your Senator what you think of this bill. Use this link to find your Senators and give them a call about clean-energy policy in North Carolina.