The other night I sat down to interview our Sundance visionary, Dave Hollister, about renewable energy, specifically about solar in North Carolina. The question I posed: “What do you think is important for us to know right now in North Carolina regarding the landscape for solar?” Dave’s response follows:
Solar is awesome. The most important thing to realize is that in North Carolina there are really two solar industries. There is the utility- scale industry which is financed and powered by very big, wealthy interests. These include the insurance industry and other powerful corporations that are looking to invest in long-term income streams, developing utility- scale projects that sell power to Duke Energy and then Duke Energy sells it back to us. So Duke becomes a middle man in the process and profits. Those types of projects have been very lucrative and they represent about 97.5% of all the solar development that has happened in North Carolina.
North Carolina is the only state that has this type of discrepancy between the two industries. North Carolina has been a very unique state in developing solar; when you hear that North Carolina is second or third in the nation for installed solar, it is almost exclusively the utility- scale industry. This has been creating havoc on the grid as most of these projects are in the eastern part of the state where land is cheaper but there is no load.
So, the industry that really benefits the people of North Carolina and truly enhances our ability to be competitive, to have long- term stability in the price of our energy, are the customer installed and locally sited systems that are owned by the people and for the people. The energy is created and used by and for the people and the energy produced can offset somebody’s electric bill. It is the difference between a dependency model and an interdependency model. And this second solar industry has taken a major hit with the ending of the tax credits in 2015. The little known fact is that the customer- owned solar industry which actually represents the majority of long- term stable jobs in the solar industry for North Carolina has taken a major hit, and it has not been getting the attention as everyone still thinks North Carolina is #2 or #3, but it is all these utility- scale projects. The utility- scale sector creates short- term jobs, with the number of folks employed full- time in these companies usually under a dozen. They hire temporary workers, install the systems and boom, the jobs are gone, whereas jobs in the rooftop solar industry are long- term, stable green collar jobs.
Really, the part of the industry that truly benefits North Carolinians in the long run, in terms of job creation, long- term competitiveness and price stabilization for the cost of electricity, that part of the industry has been destroyed by a very small number of people who control the legislature of North Carolina. 80% of the people in this state support a solar energy future yet we can’t get good legislation in the state for solar.
The other thing to understand about solar energy in North Carolina is that something or someone is controlling this and it is undemocratic. It is not being democratically decided what our future is going to be. It comes down to special interests and the first one is Duke Energy- a regulated monopoly in our state. No one has a choice regarding who to buy energy from. It all comes from Duke. Dominion has a very small territory in North Carolina but all the energy coops buy their power from Duke. Duke is the main player and they have a tremendous amount of power both in the Legislature and the Utilities Commission to really fortify, control and maintain their monopoly interests on the sale of electrons.
Currently Duke is really putting the full court press on figuring out how they are going to control the solar energy future in North Carolina. This is something everyone needs to be aware of and thinking of because to have one company to work in their own self-interest in this way is actually against the charter that created this regulated monopoly in the first place. Duke is supposed to be working in the best interest of the citizens of North Carolina, and is quite clear that their decision- making process is solely in their own interest.
This is evident in Duke’s decision to invest in natural gas infrastructure. The cost of natural gas is depressed right now and it is basically the crack cocaine of the industry currently. Duke is able to influence the Utilities Commission that this is a good idea and when the price of natural gas goes back up, Duke bears no risk. We, the customers, will bear that cost through higher rates and fuel charges, or if these structures become obsolete through what is called stranded costs. We will pay for these projects whether we like it or not.
But we know what a solar future costs, we can determine very accurately what the cost of solar is long- term. That can’t be done with natural gas. So this depressed natural gas price competes with solar in the short- term. Duke likes to focus everyone in on the short- term, the now price. There is no realization that the price of natural gas is going to spike and the better investment would have been solar.
As well, when we look at natural gas, there is no cost factored in for accidents, degradation of the environment, degradation of our health – it’s the externalized costs of energy -privatize the profits, socialize the losses. This is the organizing principle of the energy oligarchy. They get to lead us to climate catastrophe for free.
One of the things that Duke will be doing this year is forcing customers to pay for their ineptitude at storing coal ash. Yet where is the forward- thinking on socializing the cost of creating a sustainable, renewable energy future? The threat to their monopoly is distributed energy, solar energy that is owned by the people and consumed by the people. This takes Duke out of the equation and creates lost revenues. There is a term: the death spiral – what it means is that the value of the assets and the amount of money that the utility leverages towards these infrastructure projects require a certain amount of revenue coming back from the customers, and if the customers stop using that resource , they no longer have a functional business model. This creates the death spiral for the utility. This is the motive for getting in the way of the development of solar. This actually goes against their public charter; the utility is very close to being in contempt of the people of North Carolina because they are not acting in best interest of the citizens of North Carolina.
Really, we are here to say, we know we need a healthy utility. It’s important. Duke does an incredible job, they keep the lights on! It is an incredibly complex system and we have the most reliable and probably cheapest energy in the whole world. What we need to be thinking about in terms of transitioning and creating the path to a sustainable and renewable future is how to transition this utility, this regulated monopoly, in to a working partner for a sustainable future rather than an adversary.
We need people to step up to the plate and demand that this utility that is supposed to work in our best interest, do so. This means changing their business model and encouraging people to install renewable energy, to invest in clean energy. This makes our state competitive, clean and with far more jobs than the utility industry could ever create.
There is just no downside to a sustainable energy future but it does mean that Duke needs to let go of their monopoly. If we want this sustainable future, we will need to come together, as a citizenry and demand that Duke begin to work for the people again. If we are looking at creating a level playing field, we need to look at legislation and regulatory capacities that will provide incentives and subsidies for renewables so we can make this transition.
First and foremost, we need to decouple the ability for Duke to make money on maintaining the infrastructure and the distribution side of their business from the sale of electrons. Currently, they make most of their money on the sale of electrons, so anything that gets in the way that is a problem. We need to separate the distribution and management side of the business from the generation of electricity side of the business. This is basically creating the scenario where solar can compete with natural gas, or other energy sources, and it also brings Duke to a place where they are the ones that assume the risk of investing in natural gas. It is a shift from looking at the least- cost energy to the low- risk energy.
It is time to stand together and create the shared vision of what we want and work collectively to create the biggest tent possible to allow people to apply political pressure to our legislators and the utilities commission for the future we want.
And install solar. Every system installed is a victory, for the people and the planet and our future generations.
– Written by Sierra Hollister, Co-founder of Sundance Power Systems