Supported by state policies and green financing, North Carolina’s solar output grew 36 percent in 2018, making it the second-highest producer of solar nationally.
North Carolina produced 7.2 million megawatt-hours of solar generation in 2018, according to the U.S. Energy Information Administration. That’s enough to power more than 600,000 homes.
North Carolina was second behind California in its solar output. According to Duke Energy, most solar energy produced in North Carolina is owned or purchased by Duke Energy. The company owns and operates more than 35 solar facilities in North Carolina and has invested over $1 billion in the state’s renewable energy.
Duke Energy’s 2018 sustainability report showed Duke Energy-owned and purchased renewable energy, which includes wind, solar, biomass and hydroelectric power, equates to 9.3 percent of its generation mix, up 11 percent from 2017.
“Duke Energy continues to connect more solar to the North Carolina energy grid and promote new customer programs in response to the state’s 2017 solar law,” said Stephen De May, Duke Energy’s North Carolina president in a statement.
According to Solar in the Southeast’s annual report, Duke Energy subsidiaries Duke Energy Carolinas and Duke Energy Progress were among the solar utility leaders ranked by watts per customer.
In 2017, Gov. Roy Cooper signed the Competitive Energy Solutions for North Carolina (House Bill 589) law to increase the amount of solar in the state.
The bill allows for 2.6 gigawatts of new solar over 3 and a half years.
“This law resulted from about a year of work with legislators and stakeholders to craft a positive piece of legislation,” said David Fountain, Duke Energy’s North Carolina president, in a statement.“The shifting dynamics of the political landscape never deterred our team from working in the best interests of our customers.”
The law gives residential and business customers more options to install solar by offering the leasing of systems and rebates for small customer-owned generation.
According to Duke Energy’s 2018 annual report, the company launched its first request for new renewable energy resources under Bill 589. The 680-megawatt solicitation seeks projects that can be placed in service by the end of 2020.
The company also reported that more than 1,700 North Carolina customers installed solar systems and qualified for rebates, as part of its $62 million rebate program.
In October, Cooper issued an executive order to address climate change and transition to a clean energy economy.
Under the order, the North Carolina Department of Environmental Quality will develop a Carolina Clean Energy Plan that fosters and encourages the utilization of clean energy resources. The order also affirms the state’s commitment to reducing statewide greenhouse gas emissions to 40 percent below 2005 levels by 2025.
“A strong clean energy economy combats climate change while creating good jobs and a healthy environment,” said Cooper in a release. “With historic storms lashing our state, we must combat climate change, make our state more resilient and lessen the impact of future natural disasters.”
Ten years prior to Bill 589, North Carolina got a jump on other states in 2007 when it passed the Renewable Energy Portfolio Standard. The law requires 12.5 percent of electric sales by 2021 to be from renewable or energy efficiency, Duke Energy spokesperson Randy Wheeless explained.
North Carolina is the only state with such a law in the Southeast, giving it an edge on other states in the region.
However, Solar in the Southeast anticipates that Florida’s solar capacity will exceed North Carolina’s by 2022.
Financing solar
Many of Duke Energy’s solar initiatives in the Carolinas are financed through the issuance of green bonds.
Duke Energy Progress, a subsidiary of Duke Energy, issued $600 million in green bonds to finance green energy projects in March. This transaction followed Duke Energy Carolina’s issuance of $1 billion of green bonds in November of last year.
“As we look ahead, we plan to invest in clean, green generation sources into the future and will continue to look for innovative options to finance these projects with diversity-owned firms,” said Duke Energy Chief Financial Officer Steve Young in a statement.
Green bonds are no different from regular bonds with one exception — proceeds are dedicated to projects with environmental benefits, primarily climate change mitigation.
“There are a lot of investors and investor groups who want to invest in renewable energy and maybe they don’t want to invest in the company in general,” Wheeless said. “So these bonds were created to build new renewable energy facilities or buy new renewable energy facilities.”
Wheeless explained that it’s difficult to break down how much of the funds would be allocated toward different types of renewable energy sources, but there are plenty of opportunities to invest whether it be through competitive bidding of or building wind farms.
Duke Energy also launched a competitive bidding process, seeking to add 680 megawatts and overseen by an independent administrator for new solar capacity.
For industrial customers, Duke Energy has created a “green tariff,” formally referred to as the Green Source Advantage Program, to provide customers the flexibility to negotiate directly with solar developers without costs to customer classes.
Wheeless is confident that North Carolina’s solar generation will continue to increase, but it may not keep the momentum that it gained in 2018.
“Now will it [the growth] be 36 percent? That’s a pretty high mark to keep but there are still projects that are coming online and new projects being built,” he said. “I definitely feel it’s going to continue to grow.”
