Squeaky Clean Energy Podcast Transcription: Episode 111
Customers Want More Clean Energy, but Why Isn’t There Any to Buy?
North Carolina is home to numerous international corporations, many of which have ambitious sustainability goals. Currently, North Carolina is home to over 1,224 business-owned renewable energy projects, with ever-growing demand. Since 2017, Duke Energy’s Green Source Advantage (GSA) Program has offered large public and private entities an opportunity to procure clean energy through PPAs between Duke Energy and selected solar providers.
However, Duke’s new proposed program, Green Source Advantage Choice, leaves much to be desired. Under GSA, each new project helped accelerate the clean energy transition, bringing additional renewable energy electrons to the grid. In comparison, under the new proposal, projects would simply help Duke Energy reach its already existing carbon mandate.
A recent episode of the Squeaky Clean Energy Podcast tackled these pressing issues. Joining host Matt Abele, our Executive Director, is Katie Southworth from the Clean Energy Buyers Association (CEBA) and John Burns from the Carolina’s Clean Energy Business Association (CCEBA). Below is a full transcription of the latest episode.
Matt Abele
Before we dive into the topic at hand, I wanted to give the floor to each of you to talk about your organizations and the work you are doing across the southeast and in North Carolina. Katie do you mind telling us a little bit more about what you do for CEBA and what CEBA is doing on behalf of corporate customers throughout the country?
Katie Southworth
Clean Energy Buyers Association, we also call ourselves CEBA. We’re an industry organization based in Washington DC with over 400 members. We have members that are the largest energy customers in the US and many of them operate internationally as well about a fifth of the Fortune 500 are our members. We also have service provider members and NGOs and government members, such as Department of Defense.
My work as the Deputy Director of the Market and Policy Innovation Team in the Southeast is focused on the needs of customers and enabling clean energy products and programs that help them meet their clean energy and sustainability goals. The work we do in the Southeast is focused very much on customer needs and working with utilities to design effective programs as well as expand wholesale markets in the region.
Matt Abele
John, over to you. Can you tell us a little bit more about the work that Carolina’s Clean Energy Business Association is doing here in both North Carolina and South Carolina?
John Burns
Sure thing. I’m the general counsel of the Carolinas Clean Energy Business Association, which we call CCEBA, not to be confused with Katie’s CEBA. We have to be clear about that sometimes before commissions to make sure they know who is speaking. Luckily, we often agree, so that’s a good thing. But, the CCEBA started out as a solar energy developers organization here in North Carolina, but it’s now expanded to cover both Carolinas.
We represent the interests of developers of renewable energy projects, primarily utility-scale solar, but also some wind, some customers, and some providers of services to those organizations. We make sure that the voices of our members are heard before the commissions in both North and South Carolina, and we also play a role in working with the legislature together with a lot of our allies and with or sometimes against the utilities to make sure that, that we have a voice or those folks have a voice in legislation coming out of North and South Carolina as well.
Matt Abele
Yeah, speaking of allies, you know I think the three of us here often work very closely together in many of the different proceedings here in North Carolina. Hence the reason why we have both of you on the podcast here today. John, I am going to throw it back to you as it relates to the topic of conversation for this podcast episode, which is customer clean energy programs available to commercial customers in North Carolina or the lack thereof programs available to commercial customers. Can you share a little bit more about the programs we currently have in place here in the state to help those commercial customers meet their sustainability and clean energy goals?
John Burns
That’s a good question. The primary program in North Carolina you’ll hear referred to as the GSA program, which stands for Green Source Advantage. It was established back in 2017 by statute and put aside about 600 megawatts for larger commercial customers. That program was to last about five years, and of those 600 megawatts, it reserved 100 megawatts for major military installations in North Carolina and 250 megawatts reserved for the UNC system. So, what was really available for other customers was about 250 megawatts over a five-year period, which is not a whole lot of power.
In the GSA program, the customer would contract with a third-party provider, a developer, who would enter into a power purchase agreement or a PPA with Duke, and then the customer would continue to receive their energy from Duke Energy. They would pay their bill as they always had with Duke Energy, but there would be certain credits on that bill to make up for the energy that their program that their project was producing, and then they would also pay certain program charges for the administrative costs for Duke Energy. The customer would get the recs or the renewable energy credits through that program. As of 2021, no university or major military installation had used that 350 megawatts that had been set aside.
The legislature passed an update to the program that took that 350 and said, whatever’s left of this after a certain date, we’re going to reserve that for, or make it available to an eligible customer. And the way eligible customer was defined was it was a pretty specific but unnamed, very large economic development project. And so that 350 is basically reserved for one very large project. And right now, as of 2024, if you look at Duke’s website, there are 57 megawatts of capacity under House Bill 589 and then 39 megawatts of what’s called the GSA bridge program, which was supposed to get us from the original GSA program to a new program. So really less than 100 megawatts available. So all of the industry we have in North Carolina, there are less than 100 megawatts currently available of customer programs for large customers.
Matt Abele
So, I’m going to ask a quick follow-up question here. If you and others had to step back and characterize the green source advantage program that has been underway currently to date, would it be categorized as a success and maybe limited in nature or how would you describe the program to where we are today?
John Burns
I’d call it a limited success of a proof of concept, right? I mean, there’s clearly a demand out there. I think Katie will talk about or can talk about her but members clear demand for these types of programs nationwide, and there clearly has been some uptake of this program, but it’s not a lot, and in the context of a multiple gigawatt system, you’re really not making available a whole lot of megawatts for these customer programs. You know we’ll get into it a little bit later about the effect of the new House Bill 951 and the Carbon Plan reduction requirements in North Carolina and what that does to customer programs. But you’re missing, we think, at CCEBA and some of our allies that you’re really missing an opportunity to capitalize on this demand from customers.
It gets complicated when you start talking about the details of the process, but you know our monopoly, a protected monopoly energy system in North Carolina kind of makes everything go through one provider, Duke Energy, and that slows the adoption of these things down. I think had we been a little bit more adventurous in our approach back in 2017, we might have had a faster uptake.
Matt Abele
You know, for our listeners, the reason why we are primarily focusing on green source advantage right here is that is essentially the only program that has been available to large customers in North Carolina. Now I want to get to the point, John, that you just made about demand and go to Katie. So your organization represents a large number of corporate customers who have a strong interest in procuring or producing more of their own energy needs from clean energy resources. Can you talk about why programs like Green Source Advantage or other programs yet to be implemented in North Carolina are important for those customers?
Katie Southworth
Absolutely, and I’m probably going to take us on a little trip back in time here real quick to sort of set the stage for Green Source Advantage in the broader context of what’s happening across the US with green tariffs over the last decade. A quick plug, Clean Energy Buyers Institute has an annual report that we do that summarizes the green tariff market. As of last year, 40 utilities across 28 states had green tariffs available to large customers. You can check out that report to get more details and see the different features. A lot of the activity that we’ve seen in terms of growth of green tariff programs has been happening in the Southeast and West. Those are regions where electric utilities do not participate in organized wholesale markets.
To your question about customers and clean energy needs, our customers, it’s all over the map in terms of where they are on their clean energy journey. You have some that are very ambitious, and they’re sort of leading the way with 24/7 clean energy by 2030, and others that are just beginning to set goals. Goals may look like, you know, for example, 25% renewable energy to a facility by 2025. Other goals are set up in terms of carbon emissions. So, CEBA, the Clean and Clean Energy Buyers Association, reflects our approach to clean energy procurement that is technology agnostic. So nuclear is on the table for many of our members. I like to be upfront about that. It’s not just renewable energy that our members are interested in, as well as demand response and other things.
We’ve seen a proliferation in green tariffs across the U.S. I agree with John’s estimation that we’ve seen some success with the GSA program, but like in other states in the southeast, particularly Georgia, Louisiana, North Carolina is now facing a similar problem in that there is so much demand for clean energy, which requires capital, which requires partnership, which requires a variety of programs that are tailored to customer-focused solutions. We’re seeing a huge uptick in demand. And at this point, it’s sort of the second and third generation of programs that our customers are interested in participating in many of those, for example, the leading customers that are sort of pushing their goals more aggressively. You know what I hear from our members often is we just need utilities, particularly where we don’t have all organized wholesale markets, utilities to match our ambition on those clean energy goals.
I guess I could speak a bit more to the reasons for having goals. Every company is situated in its own industry, and some operate nationwide and regionally. There can be a variety of motivating factors, but it can be employee retention and recruitment. If you’re a supplier to a company that has a goal, you may, as the scope, you know one, two, and three emissions. A company may not have their own goal, but they may need to meet a goal in order to provide a service to a company that does have a goal. It’s a risk mitigation strategy at this point, as well as an opportunity to capitalize on many of the federal investments that are coming down. So those are just some of the reasons that companies point to for setting their goals, but we are all across the map in terms of that.
Matt Abele
Yeah, and I want to hone in for a second on the piece that you just said about risk mitigation strategy. In talking to a lot of these companies here in North Carolina, it’s not just about meeting yeah ESG or sustainability goals. It’s really about hedging their bets against you know fuel cost volatility, especially as we’ve seen here in the Carolinas over the past couple of years, with prices of natural gas swinging pretty rapidly up and down due to a bunch of different reasons. Then at the same time, we’ve also had some reliability issues over the past couple of years, you point to Winter Storm Elliott. That’s an issue if you are a manufacturer who is running you know an assembly line 24/7 and need to keep those facilities online or are a data center in which you have, you know, very important customer data that needs to stay online 24/7. Having more of that onsite generation really plays into that risk mitigation strategy from a reliability and a cost perspective in the long term.
To help contextualize how much demand there is in North Carolina for additional renewables from large corporations, 86 companies in the state have already set a goal of being powered by 100% renewable energy and 41 of our 50 largest employers have renewable energy goals as well. I want to you know kind of dive into that point a little bit more, which is: help me understand where the disparity is. If there is so much demand for commercial clean energy programs, but yet we have very little programs available for those customers to partake in in the state, you know, what, is the discrepancy there and why don’t we have more options? Katie, I’ll start with you on this.
Katie Southworth
Sure, and well, so that’s ah that’s a big question. What I’ll do is try to sort of color that in with an example from Georgia that’s recently been in the press a bit. Hyundai is actually not a member of Clean Energy Business Association yet, but they recently announced that they’re breaking ground on a new facility in Georgia, and they committed to powering it with 100% renewable energy. Now, their utility is Georgia Power, and they’re going to be served by Georgia Power in that service territory, but they’re not participating in Georgia Power’s subscription program for clean energy, which is called the CARES program. Instead, they’re buying recs from another market, likely Texas or maybe Southwest Power Pool, where you have an organized wholesale market with a lot of competition and the ability for independent power producers, wind and now increasingly solar in that part of the country, they’re generating electricity and selling those recs into the Southeast. There are a number of limitations when you have programs like the one in Georgia when two times a year, there’s a call for enrollment and then developers submit their proposals that go into a pool of resources. The timing of that kind of program doesn’t necessarily always align with a facility that maybe needs renewable energy day-one. If the RECs are more competitive elsewhere, you know that’s what they’ll do.
We’re constrained fundamentally in the Southeast by market structure. Since 2014, customers have voluntarily procured and announced 77 gigawatts of clean energy in the US. 80% of that is in organized wholesale markets, where we see what’s called virtual power purchase agreement transactions. The rest are coming out of these, you know for the most part, and other types of green tariff transactions like subscription programs and sleeved power purchase agreements like you kind of have with the GSA, the green source advantage program. We’re just in the next phase of these things. Even without an organized wholesale market, there are a lot of solutions that can be implemented to meet customer goals. Customers have capital that they want to bring along with solutions that they’ve been working on across the country and worldwide. They want to bring that capital and innovation into North Carolina, but they’re constrained by a lack of a program or a product to plug it into, frankly. This market structure is a barrier.
Matt Abele
I know it has been a barrier, and it’s one of the things that, for example, our economic development entity here in North Carolina is hearing quite a bit about when customers are considering the state. You know a lot of them have their own renewable energy goals, and I think there is a sense of frustration that there are not programs available to help them meet those goals. There have been some documented cases of companies selecting to move to other states because there haven’t been the opportunities or programs available for them here in North Carolina. We could go down a whole separate rabbit hole about recs and recs outside of the market in which you know manufacturing facilities are being deployed. At risk of doing that, I’m going to go over to John to see, John, if you have anything else to add about the question of you know the discrepancy between demand and available programs for customers in North Carolina.
John Burns
Well, I would agree with Katie and obviously defer to her organization’s experience outside of the Carolinas, and clearly the demand is there. It’s been a long time since my Econ 101 classes, but where I think I learned that if you’re not meeting that demand, that you’re losing an opportunity, right? There is an opportunity there for us to meet those demands. There’s an exceptional amount of economic growth going on in the Carolinas, which is why we are seeing an updated, increased load forecast. What we should be trying to do is maximize the amount of that load that is met by these new resources that are clean, that are carbon-free, and are reliable. I think if we’re not doing that, then we are we’re really missing an opportunity.
I have to be careful that I don’t venture beyond in an open docket what we’ve filed in some of our statements in these dockets. There’s almost a double layer of bureaucracy that is attached to some of these programs. I hear from some customers that these programs seem complicated. Now that’s probably not a problem for an entity of some of the larger members of Katie’s organization, you know your Google’s and your metals are sophisticated but you know a larger manufacturing plant that may not have a lot of experience with parsing these things, may not even see the benefit of participating in a process that requires a whole lot of accounting time for them. It’s another cost center. What we hear, and we’ll get into the proposals in the current docket, but their folks are not really interested in paying a premium if they’re not getting what they want out of that plan, right? They’re willing to pay a premium if they’re getting the thing that they’re looking for. If they’re not getting what they’re looking for, then their participation in the program is likely to drop off. I think we need to be aware of that and plan accordingly. That’s some of the things we’ve asked for in our pleadings in the dockets.
Matt Abele
John, I want to go back to a point that you just made about pretty significant load forecast increases that the utilities are making not only in North Carolina, but all across the southeast and different IRP proceedings, really associated with economic development and you know migration into these states in which our populations are growing pretty significantly. I’m curious with a pretty significant new demand projected for the state moving forward, does that change or help to shape the conversations around customer programs in which the utility is now looking for more creative solutions to offset the need to build a ton of new natural gas peaker plants, for example, to maintain reliability in a way that we can meet that demand in the time in which it is coming into the state and it is coming in very quickly.
John Burns
I think it’s a little bit outside of the scope of this conversation, but I think there’s probably a heck of a lot of opportunity for behind-the-meter production, with you know on-site production of energy for some of these particularly large industrial sites and particularly things like data centers. There it’s a constant and determinable load that’s going to be there. We, I think, are missing the boat on some opportunities for behind-the-meter supply. That’s a little bit outside of the customer program. But, you know, the folks who are not in the Carolinas may wonder why you can’t just contract with the supplier of your choice to provide the energy from that supplier, you can, but you got to involve a third party in that conversation in North and South Carolina. If we can do some behind-the-meter, I think that would help.
There’s been some news recently about agreements or memorandums of understanding between Duke and some of the large users, where those really large sophisticated users are seeking to bring their expertise and their demand and their load to the table to try to figure out ways where they can contract sort of directly with Duke and say, hey, we’d like to do this, we’d like to take on some of the some of the risk of developing this new technology because we think it can work. It’s worked elsewhere. Let’s have a separate agreement around that particular project. We’re interested in what’s going to come from those MOUs and I defer to Katie on the details of those, but, you know, certainly there’s some opportunity there.
Matt Abele
John, you’re making my job so much easier by teaming up the next questions that I’m going to ask. No, that’s great. I’m going to skip around a little bit, and we’ll come back to green source advantage. But Katie, to John’s point about data centers, there has been a lot of attention recently on data centers and particularly the electricity that they consume to maintain their reliable operations 24 hours a day. Are we seeing this huge influx of data centers to places like North Carolina? And to John’s point, is a solution here to allow these facilities to generate more of their power on-site to offset the need for more utility-side generation facilities?
Katie Southworth
Well, that’s a great question about data center demand growth in the region, and I get it a lot. Of course, you know I don’t want to go into any confidential information that we’re seeing within the various dockets that CEBA is engaged in, but sort of as a general rule, it is not always that necessarily the majority of load growth is coming from data centers number one. We’re also seeing expansion in automotive manufacturing at additional lines being added like the Hyundai plant that I mentioned. Q-cells has announced they have a facility in Northern Georgia. They’re going to be the largest solar panel manufacturer in the U.S. We’re seeing a lot of batteries, a lot of advanced energy technology announcements. Then, of course, U.S. Census South Region is the fastest growing population census tract. It has been for the last five years and will be for the next 10 years by all estimates. There’s a lot of factors driving load growth and electrification also to pile on. But yes, data centers do need reliable, cost-effective, affordable, and clean energy.
I would just like to also mention, because we have many retail members, that Winter Storm Elliott and reliability events like that actually impact retail suppliers in a very significant way as well. Even though let’s say a retail store may not be open at midnight, they have groceries, right? They may be selling groceries and perishable products that need to have power. There is a need as we are experiencing more extreme climate events and weather in the region particularly in the winter-time to you know for utilities to work with customers to help does design products and programs that enable that behind-the-meter investment, which can also support the grid in times and in peak pricing times.
So, I agree with everything that was said there, but I do want to just highlight that it’s not just data centers or large and you know manufacturing lines that need reliability, but everybody! Everybody wants the power to turn on when they turn on the light switch, but retailers really do care about that as well, and there’s a lot of need with those customers. In terms of the announcement from Google, I’ll point to their press release, and we don’t know a ton of the details. The last week in the south at SEARUC, the Southeastern Association of Regulatory Utility Commissioners, there’s a panel where Google and Duke talked about, I think they’re aiming for Q4, the final quarter of this year, they’re going to be making a filing to the utility commission with a more fleshed out program proposal, and they’ll be doing some stakeholder outreach starting soon, I expect.
We’re seeing a need for programs like the framework that was announced a couple of weeks ago with Duke where customers would like to bring flexible, innovative solutions, sort of all of the above technology-agnostic strategies. It could be there’s talk about SMRs were sort of the big talking point initially, but now they’re talking about going back to AP1000. There’s talk about need for hybrid, solar storage, demand response, aggregating DERs, all of the things that many of our members are experienced with, technologies they’re experienced with in other parts of the country. They’d like to be able to design solutions to help meet and address the load growth in a clean way for a clean firm. That’s happening in North Carolina, but there’s also a program that we’re working with Georgia Power and in Georgia on. I expect to see more of this kind of a thing where customers are able to bring products and projects that they want to see to the utility.
I’ll add also, and I’m sorry, I’m just going on and on, but there’s the need for clean energy generally, and you know that can be colored different ways depending on the customer, but many customers also want to do other things to meet their ESG goals, such as workforce development projects. They may want to do an installation that has other beyond the megawatt characteristics. So, in utility territories where customers are really just, let’s say they’re limited to subscribing to a rec, renewable energy credits, or subscribing and opting into a tariff, if they’re not able to do some of the community development and beyond the megawatt types of adding that onto their projects, they’re also feeling a little bit, there are some needs there. So that’s new too in this space. Originally you just had this sort of straight-up green tariff where you’re paying a bit of a premium and you’re getting clean energy. Customers now that they’re experienced, and they’ve done these things for the last 10, 15 years. They want to get creative and bring new technologies on. They tend to be a bit less risk-averse than utilities in that regard. I just wanted to add that as well. I think that that’s an exciting development beyond the megawatt.
Matt Abele
Yeah, it’ll be very interesting to see what is specifically filed as it relates to this press release that came out from Duke about these preliminary agreements that have been put in place with companies like Google, Amazon, Microsoft, and Nucor to establish some sort of green tariff in which those companies are willing to pay some sort of premium to help sort of accelerate the development of some of these technologies and procure some of that power on-site. I think it’s going to be one of those situations where the devils are in the details in terms of the specific tariff structures. So, we’ll see what all that looks like once that comes to fruition.
John, I want to circle back around to the conversation that we started that the podcast with today, which was green source advantage. There was a settlement agreement filed recently between Duke Energy, SIGFUR, which is the Carolina Industrial Group for Fair Utility Rates, and the public staff. Can you talk about what they are proposing for the future of the Green Source Advantage Program and why it may not actually lead to any additional renewable build-out above and beyond what is already set to be contracted through Carbon Plan procurements in North Carolina.
John Burns
Yeah, I’m happy to do that I think it to answer that question, it may require a bit of a backtrack to sort of talk about what Duke proposed initially, and then what the settlement does. And that’s all in the context of House Bill 951, which many of your listeners probably are aware of, but maybe not all. But it was a bill passed in 2021 by the North Carolina legislature and signed by the governor that commits North Carolina and requires Duke and the North Carolina Utilities Commission to develop a carbon plan that reduces carbon dioxide emissions from utilities by 70% by 2030 with some you know potential movement between 2030 and 2035, and then to reach carbon neutrality by 2050. That’s a laudable statutory goal and one that we at CCEBA and others, including NCSEA, worked very hard to get in place. But it really complicates the issue of voluntary customer programs in a market like North Carolina.
That’s because of the concept of additionality or regulatory surplus. You’ll hear it referred to as both those things. You know a corporate sustainability policy or a rec program, they want to see that their corporate action is actually causing the green energy to be generated. The argument is if the state is already committed to generate that energy, if the utility is already going to generate that particular megawatt of carbon-free energy, then the corporation that is purchasing the rec can’t really say that its purchase or its action was the cause of that generation, right? It’s going to happen anyway. And if it’s not additional, they have trouble getting those recs certified. And that’s important to all of their corporate sustainability policies, particularly for publicly traded organizations that have certain reporting requirements.
So, what Duke has proposed to do originally was to update the Green Source Advantage Program with something that they call GSA Choice, which would amount to 4,000 megawatts of total capacity for this choice program, about 250 megawatts a year over about a 10-year period. The complicating factor is that those 250 megawatts would not be additional to their annual solar procurements under the carbon plan. So, if they were going to procure 1500 megawatts of solar energy in 2025, that 250 megawatts of GSA contracts would come out of that 1500. So they would only need to go out and procure an additional 1250. That really put a crimp in the concept of additionality. You can’t really argue that it’s additional if they’re taking a credit that was already going to be but for energy that was already going to be generated. So, we and NCSEA and others argued that that this meant that the program would probably lack uptake. We heard from some of our customer members that it wouldn’t be that attractive to them. You’re in an environment where rates are already increasing pretty rapidly due to many factors, but you know they’re not interested in paying a premium if they’re not going to get that additionality that they’re looking for.
This docket has been open for a very long time. For over about a year and a half of discussions and briefing and conversations that issue was taken up with Duke and they reached a stipulation with two of the parties they were talking to the public staff and SIGFUR that would add something called the resource acceleration option. I got to give them credit for trying to get there. They add an additional 300 megawatts of sleeved PPAs every two years up to a total I think of a thousand megawatts that would be additional to the solar procurements each year. They propose that if you’re going to have a customer do one of those sleeved PPAs for the GSA Choice Program, they would need to contract with a developer’s project that failed in the prior RFP. So, a solar company you know participated in that year’s RFP, but wasn’t selected because of cost or some other reason. So essentially, you’re requiring your customers to choose to get additionality, they need to purchase from the less competitive projects, so the more expensive ones.
We objected to that. We said that’s not the easiest way to get there. We appreciate the effort, but it would be easier if you made the whole GSA Choice Program additional to the annual solar procurement. We propose that the 250 be additional, so in 2025, if they purchase 1500 megawatts, they’d add 250 of customer PPAs to that, it would be additional, and it wouldn’t be required to come from the more expensive contracts. The argument is whether Duke’s proposal and in the settlement stipulation, they say they have you know about 400 megawatts a year, the 250 of the regular GSA program plus 150 a year of this new REO option, that’s 400. Our point is the 250 is not going to be attractive because it’s not offering additionality and the 150 of additional is not going to be attractive because it’s coming from the most expensive projects. We’d rather have 250 of competitive projects and allow that to be additional and let those customers argue that they do have additionality and try to get their certification. We think it gives them more of an argument.
You know it’s not clear that any of these proposals will actually provide additionality that’s going to be certified, and that’s just a complicating factor of having adopted House Bill 951’s goals. It gets really complicated there, but I tried to do my best to boil it down.
Matt Abele
I mean, it does get complicated, but it’s also you know very frustrating, right? If these customers are already willing to pay a premium and take on you know the risk of developing these projects so that it’s not fully saddled on ratepayers. This is a creative mechanism to help offset some of this demand that we have been talking about with all these new manufacturing facilities, right? It seems like a win-win-win all around and [it’s] frustrating that we’re not to that point of being all in on additionality to help offset some of that demand moving forward.
John Burns
In fairness, the additionality equation is a hard one to solve when you’ve got a statutory goal. North Carolina is, I think, unique in the sort of monopoly markets of having adopted a statutory goal like this, maybe Oregon as well, but it’s a hard nut to crack, but we think the proposal that we’ve presented is a good faith effort to do so. We appreciate the proposal by the stipulating parties, but we don’t think that they really get there.
Matt Abele
And we’ll make sure to, in the show notes, link to the docket related to green source advantage so that folks can kind of follow along with the various filings that we’re talking about here.
John Burns
Right, and I would say if they want the quickest summation of what the proposals are, if they look at the last four or five filings, there’s comments on the stipulation itself and then the reply comments by Duke and the public staff that sort of give their counter-argument to the argument I just made. I think it’s very informative and none of them are very long because the utilities commission made clear that we needed to keep them very short. So we did. So, I think they’re very readable and very understandable for folks.
Matt Abele
So, all in all, we’ve identified some real challenges with the current programs and structures in place for commercial customers in North Carolina. What would be the most ideal scenario in North Carolina to allow these customers to procure or deploy the necessary clean electrons that they so desire? Katie, I’ll start with you on this one.
Katie Southworth
Oh wow. That’s a really big question. So, if I were king for a day what would I what would I have. Well, I think over the longer term you know we’re missing out in the Southeast on the reliability and economic benefits that can come from wholesale market competition. So measures that make customers able to transact in a competitive wholesale market, getting in the direction of that, things like all sorts of procurement, competitive procurement within programs. Those are all good things that can go a long way to making sure that customers aren’t paying too big of a premium that y’all keep mentioning. So, over the longer term, moving towards that organized wholesale market construct would be a big part of ensuring that we can get to 90 percent decarbonized grade by 2030 which is our goal at CEBA.
Then in the short term, I think we just need more of everything. Some customers need additionality, some don’t. Some care more about GHG reporting and environmental attributes and need data and programs to work with utilities to make sure that they can do their reporting. We just need a variety of programs that can work for all shapes and sizes of companies. We need subscription programs for companies that don’t want to have to do it all themselves. We need sleeve power purchase agreements and then bring your own solutions to the market is also now on the table and being developed throughout the region. So, over the short term, we hope to see a proliferation, continued proliferation, and expansion of green tariff programs, but longer term, we’ve just got to start making moves towards organized wholesale market expansion in the southeast.
John Burns
Yeah. Well, Katie said it very well. I think with all the things that Katie mentioned, especially wholesale market reforms would help. Certainly, we would like to see more competition in North Carolina, and we think that it’s hard to design a market without market signals. So, it would be helpful to all of this development if there was more of a market for these things than we currently have. That’s a long-term project in our environment. So, I think what we need to do is sort of pave the way for things like we mentioned before, like behind-the-meter projects, allowing large customers to contract directly with developers to develop a project behind the meter, which would give them some control and wouldn’t impact other ratepayers. In our market, it’s very important and it’s in the statute that we have to avoid subsidization of some customers through the rates of other customers.
We’ve got to be very careful about that and as we develop these programs that sort of requirement is out there and everybody’s got to think about it. It’s important that we provide reliable energy, and so we tend to be very cautious in this market it seems to me, and I’m a relatively new participant in these dockets. The caution about around providing reliable service is warranted and incredibly important, but I think that there are lessons we can learn from other parts of the country that are providing reliable power and reliable energy to their customers but are able to sort of develop new constructs to get that and to do the building and to do the development. We would be open to you know all of the options that Katie talked about, and we’re very interested in seeing what comes out of these proposed MOUs with the large customers. That is a model that has some promise, depending, of course, on the details.
Really, we want to make sure that this stuff is affordable and that it offers what the customers want. That’s the key role. As developers, we want to sell what the cut what our customers want to buy, and to the extent that the customer’s demands are not being met, then the program is not achieving its objectives. So we need to really aim the programs at what the customers want.
Matt Abele
And I want to thank you both for joining us on this episode of the Squeaky Clean Energy Podcast. Your insights about customer clean energy programs are incredibly informative to all of our listeners on this front who are interested in how all of this new business coming into the state is going to meet their future demand and how clean energy is going to play an instrumental role in doing so. John, Kate, thank you so much for joining on this episode of the Sqeaky Clean Energy Podcast.
Katie Southworth
Thanks so much for having me, and I want to say one more thing. Our customers have a variety of needs and some of them may want to bring their own projects. Some may want to subscribe. The one thing that I get agreement on is wholesale market expansion. I hear that it gets controversial where y’all are at in North Carolina. It is not controversial with my members. So anyways, we have a lot of demands, we want to be part of the solution, but that wholesale market expansion isn’t, you know, there’s not controversy on the customer side. Thank you.
John Burns
Always great to be with you and always great to work with NCSCA. [We] look forward to the next project.
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