Consumers Bear the Brunt of Net Zero Agenda, Critics Say

Electricity Monopoly Duke Energy Takes Heat for Rate Hikes to Fund Climate Plan

Duke Energy, a regional electricity provider based in North Carolina, has come under fire for allegations that it is driving up electric bills to make customers pay for the billions it is spending on climate change.
Consumers Bear the Brunt of Net Zero Agenda, Critics Say
An aerial view of solar panels at the Sutter Greenworks Solar Site in Calverton, N.Y., on Sept. 19, 2021. (Bruce Bennett/Getty Images)
Kevin Stocklin
Duke Energy, a regional electricity provider based in North Carolina, has come under fire for allegations that it is driving up electric bills to make customers pay for the billions it is spending on climate change. 

Consumers’ Research, a consumer advocacy group, sent a letter on Aug. 24 to the North Carolina Utilities Commission stating, “We implore the commission to put an end to the abuse of North Carolina consumers by Duke Energy.”

“This is a company that has a government-mandated monopoly in the state of North Carolina, consumers don't have any option when it comes to who they get their energy from, and yet they're bragging about all the ways that they are increasing their costs and having to pass that along to the consumer,” Consumers’ Research executive director Will Hild told The Epoch Times. 

“If you look at their application for the most recent increase in rates, which they want to raise nearly 20 percent over the next few years, they cite many of these things: building EV charging stations, which they say they’re going to have to have subsidized by the ratepayers, and retiring perfectly working coal and natural gas power plants,” Mr. Hild said. “Obviously they’re going to have to waste the resources they’ve already paid for to build new ones.”

Duke Energy, headquartered in Charlotte, North Carolina, is one of America’s largest energy holding companies. It supplies electricity to 8.2 million customers in North Carolina, South Carolina, Florida, Indiana, Ohio, and Kentucky, and owns 50,000 megawatts of energy capacity.

The company states that it is “executing an aggressive clean energy transition to achieve its goals of net-zero methane emissions from its natural gas business by 2030 and net-zero carbon emissions from electricity generation by 2050.” 

“The country-club sets that run some of these companies, especially utilities, seem to think they’ve found a way to promote left-wing policies, and then pass whatever costs result from that on to ratepayers, because they have this monopoly,” O.H. Skinner, executive director of the Alliance for Consumers, told The Epoch Times.

“The utilities space is one of the safest places to push this because there’s no real competition and they can always pass it along,” Mr. Skinner said. “What do they care? Everyday consumers will just pay more.”

On Aug. 17, Duke Energy filed its updated Carbon Plan, which included a “significant increase in renewables” such as wind and solar, in addition to new nuclear facilities and hydrogen-capable natural gas facilities; it also “retires coal by 2035; achieves carbon neutrality by 2050, as required by North Carolina’s clean energy law.” 

“[Duke Energy] are one of the biggest funders of political campaigns in the state of North Carolina, and those are the people, the legislature and the governor, who appoint members to the North Carolina Utilities Commission,” Mr. Hild said. “Basically, they are able to influence the politics that then decide whether they can increase rates on consumers.”

Before approving the rate increases requested by Duke Energy Progress (DEP), the North Carolina Utilities Commission (NCUC) held a public hearing in March. According to its notes from public comments, “almost all the public witnesses stated their opposition to DEP’s proposed rate increase” and “many witnesses testified that they were on fixed incomes and about the poverty in some of the counties served by DEP.” 
StarNews, a local North Carolina newspaper, reported that “residential customers could see their bills increase by 18.7% by October 2025.” The average Duke Energy customer would see his bill increase from the current rate of $126 to nearly $152 by late 2025.
Consumers in Ohio, which are also served by Duke Energy, saw the energy production segment of their bill go up from 0.06 dollars per kilowatt-hour (kWh) to 0.10 dollars/kWh—a 58 percent increase. 

Cost of Net Zero 'Mostly Unknown'

How much more consumers will ultimately have to pay to fund the transition remains unclear. According to a fact-finding report by the NCUC, the “costs that Duke will incur and, therefore, the implications for Duke’s customers remain mostly unknown.” 

The report states: “Duke asserts that this proceeding ‘boils down to one simple question: what are the near-term reasonable steps to be taken by Duke Energy to begin meaningful and substantial progress towards the 70% Interim Target on the path to Carbon Neutrality.’” Duke sought a pledge from regulators that “it will be assured future recovery of such initial project development costs” through rate increases, whatever those costs may turn out to be and whether or not the investments deliver as projected.

“The language around these green energy policies is supposed to create the impression that there is no alternative and so we have to do this,” Mr. Skinner said. “Normally, when someone’s just telling you how great their product is and they never to tell you how much it costs, you can sure bet that at the end of the day it’s going to cost a heck of a lot more than you want it to.”

Bloomberg news estimated that “the transition to a net-zero emissions world opens up an investment opportunity that totals almost $200 trillion by 2050―or nearly $7 trillion a year.” McKinsey, a management consultancy, estimated that achieving net-zero emissions by 2050 would require $9.2 trillion per year to be spent on physical assets. 

“To put it in comparable terms, that increase is equivalent to half of global corporate profits and one-quarter of total tax revenue in 2020,” McKinsey states.

Many European countries are farther along than the United States in their transition to wind and solar power, and the result for consumers has been increasingly unaffordable electricity rates. 
Electricity rates in Germany went from 26 euros per megawatt-hour (MWh) in January 2020 to a high of 658 euros/MWh last summer, before falling back to the current level of about 100 euros/MWh. While many blamed the spikes on embargoes of Russian natural gas, the rate increases followed Germany’s “Energiewende” agenda to retire coal and nuclear plants, thus creating a critical dependence on Russian exports. 
Electricity rates in the United Kingdom rose from 35 pounds/MWh in January 2020 to a high of 363 pounds/MWh last summer. Rates fell to the current rate of around 80 pounds/MWh after a consumer backlash caused the British government to announce a five-year regime of price controls to ensure Britain "is no longer at the mercy of international energy prices or geopolitical events.” 

A British public-private organization called the Climate Change Committee (CCC) has urged customers to stop heating their homes in the evening to help the government hit its net-zero target.

British newspaper The Daily Telegraph reported that the CCC called for "behaviour change" among British consumers and recommended that Britons "pre-heat" their houses in the afternoon when electricity usage is lower. The CCC argued this was about saving people money, but some suggested that it was because Britain's shift to renewables could make it unable to meet demand at times of extreme temperatures.

Despite the rate hikes in North Carolina, the NCUC reports appeared to indicate significant support for Duke’s Carbon Plan.

Some of the NCUC hearings attendees, which included corporations like Walmart, Kroger, Apple, Google, and Meta and advocacy groups like the Sierra Club, “testified to their concern regarding DEP’s use of fossil fuels, including coal and natural gas power plants, fracking, and DEP not adequately increasing the use of clean energy and renewables,” the Commission reported. The NCUC further noted that “witnesses stated their preference for renewable generation, including wind, solar, and hydropower, and for more aggressive implementation of energy efficiency (EE) measures, battery storage, and improvements to the transmission grid.”

In addition, the NCUC reported, “some public witnesses voiced their view that DEP’s executive compensation and shareholder dividends are excessive.”

Duke instituted a policy in 2021 to align executives’ pay with their progress in pursuing green energy programs. Duke Energy CEO Lynn Good, an avid supporter of net-zero initiatives, has reportedly seen a 30 percent increase in her pay, from $16.5 million in 2021 to $21.3 million in 2022. 

Duke Energy spokesman Neil Nissan explained her pay increase as follows: “Under Lynn Good’s leadership in 2022, Duke Energy had a strong year delivering value to customers and shareholders as we made progress executing our strategy, responding to difficult external pressures, and advancing our clean energy transformation.”

As sometimes happens when companies take on progressive causes, Duke Energy has also been criticized for not going far enough in its transition agenda.

An April statement from the Natural Resources Defense Council, an advocacy group that supports the elimination of fossil fuels, declared: “Duke failed to keep the lights on last December, but it is now pursuing enormous rate increases of more than 30 percent to help pay for fossil fuels and huge executive salary raises.”
The Political Economy Research Institute, a division of the University of Massachusetts, claimed that Duke Energy was the second-largest emitter of CO2 in 2020, according to its “Greenhouse 100 Polluters Index.” Vistra Energy, a Texas-based power company, was first. 

Grid Stability an Increasing Concern

In addition to rate hikes, the reliability of the electric grid has increasingly become a concern.

The NCUC fact-finding report states: “the North American Electric Reliability Corporation (NERC), the federal regulatory authority whose mission is to assure the effective and efficient reduction of risks to the reliability and security of the grid, has acknowledged that traditional resource planning methods may not consider the real-world grid impacts and interactions of an evolving resource mix with less baseload generation and more variable generation, inverter-based resources, storage, and distributed energy resources (DERs), leading to potential generation or transmission insufficiencies.”

In short, the NERC warned that retiring reliable energy sources like coal and natural gas, the output of which can be adjusted essentially at will, and replacing them with weather-dependent sources like wind and solar, could destabilize the electric grid. 

The NERC further warned that “in the SERC-E region, which includes North Carolina, shrinking capacity and demand growth cause a risk of shortfall in extreme cold weather events.”

These shortfalls did occur in 2022. As noted by the Commission, “the emergency outage events experienced by some Duke customers in late December of this year during extreme cold temperatures provides a sobering example of the consequences to customers during times of stress on the electric system.” 
During this “late December” period—the Christmas holiday—Duke Energy instituted rolling blackouts in North Carolina because it was unable to meet demand for heat as temperatures fell. 
Duke Energy has projected sharp increases in energy demand in its region. 
“Between economic development success, population growth and increased adoption of electric vehicles, energy use by Duke Energy customers in the Carolinas is projected to grow by around 35,000 gigawatt-hours over the next 15 years—more than the annual electric generation of Delaware, Maine and New Hampshire combined,” the company stated. 

Some who were present at the NCUC rate hearing “testified about persons and communities often hardest hit by climate change, including those of low-to-moderate income levels and people of color, who because of excessive power bills and the cost of electric bills, often must make difficult decisions prioritizing basic necessities … Witnesses also testified about the negative correlation between climate change and public health. Witnesses pointed to the increase in cases of asthma, post-traumatic stress disorder, and a person’s lack of physical activity due to extreme temperatures.”

On Dec. 30, 2022, the NCUC announced its approval of Duke Energy’s plan to “achieve a 70% reduction in carbon dioxide emissions from electric generating facilities in North Carolina,” which included the retirement of all of Duke’s remaining coal plants (9,000 MW of capacity) by 2035.

“The emergency outage events this month particularly underscore the need for an orderly transition away from fossil fuels to low and zero carbon dioxide emitting generating resources while maintaining or improving the reliability of the electric grid,” the Commission stated in a press release.

The consensus solution in North Carolina to rising energy costs and health disorders was to shut down existing fossil fuel plants and to spend more than $100 billion over the next decade to build a network of coastal and inland wind turbines and solar farms, and construct EV charging stations, which they hope will moderate the weather. While low-income consumers may not be able to afford EVs and may have to give up other things to pay higher energy bills, the health issues attributed to climate change would hopefully be mitigated as well.

In 2022, the Federal Energy Regulatory Commission (FERC) approved an exemption for BlackRock, the world’s largest asset manager, to increase its ownership of public utilities beyond the legal 20 percent limit. Vanguard, the second-largest, has also requested FERC approval for this exemption. 

Among the largest shareholders in Duke Energy are BlackRock, Vanguard, and State Street. In May, seventeen state attorneys general filed a motion with the FERC, attempting to block BlackRock from acquiring large shares in America’s utility companies.

In a 2022 report, BlackRock stated: “If the world wants to reach net zero by 2050, the use of coal, gas and oil needs to decline at a much faster clip than it would under current policies or pledges.”

Duke Energy, which has a 24-hour media hotline, did not respond to a request to comment for this article. The NCUC declined to comment for this article, but directed The Epoch Times to its reports, which were referenced in this article.

Kevin Stocklin is a business reporter, film producer and former Wall Street banker. He wrote and produced "We All Fall Down: The American Mortgage Crisis," a 2008 documentary on the collapse of the mortgage finance system. His most recent documentary is "The Shadow State," an investigation of the ESG industry.