Local Government:

Fifteen local governments, North Carolina

Project:

North Carolina Local Government Engagement on Duke Energy’s 2020 IRP

Category:

Partnerships and Collaborations, State Energy Regulator Engagement

Project Purpose

Use the collective power of 15 cities and counties in North Carolina to participate in and influence the regulatory review process for their electric utility’s 2020 Integrated Resource Plan (IRP) to ensure it supports and aligns with the local governments’ clean energy and community goals.

Project Overview

Typical process for utility IRP development and regulatory review.

Some local governments are finding that their abilities to purchase renewable electricity or develop off-site renewable energy resources, essential components for meeting their clean energy goals, are limited by utility and state policies and processes outside of their control. To address these limitations in North Carolina, 15 local governments joined together to learn about utility IRPs, evaluate utility engagement pathways, develop core messaging about their desired outcomes, and submit public comments to intervene in the regulatory review process for the 2020 IRP of their electric utility, Duke Energy.

To start, interested North Carolina local governments participated in utility trainings held by technical experts from multiple sustainability groups to learn about the importance of utility IRPs and the pathways for engaging on them. These pathways include:

  1. Directly engaging with the utility to influence analysis and scenario development.
  2. Participating in regulatory review processes.
  3. Making public comment on the plan through media engagement.

By the time most of the governments learned about the IRP, the only engagement pathways available were the second and third options.

Once the group of local governments was educated on the pathways available, the next step was to decide whether to participate in the regulatory review process and make public comments. The local governments discussed a series of questions designed to clarify their ability to engage in this topic, the desired outcomes, and the likelihood of success. The comments and testimony that individuals or organizations provide during an IRP review process can influence a state energy regulatory body’s decision to approve, deny, or request changes in subsequent IRPs. The local governments decided it was worthwhile to participate in the North Carolina Utility Commission’s (NCUC) review process for Duke Energy’s 2020 IRP given its impact on the local governments’ abilities to achieve their renewable energy and greenhouse gas emissions reduction goals.

“The City is making progress towards its carbon reduction goals, but the ability to achieve these goals relies, in part, on reducing the carbon intensity of Duke Energy’s grid mix. The decisions made in this 2020 Biennial IRP process will critically impact the City’s ability to meet its renewable energy and GHG reduction goals.”

Comments submitted to NCUC BY Karen Weatherly, City of Charlotte’s Senior Assistant City Attorney

The next step for the group was to align on high-level objectives and key messages. With help from technical experts from Environmental Defense Fund, GridLab, RMI, Southeast Sustainability Directors Network, and World Resources Institute the local government partners focused their engagement on a subset of topics, including resource procurement, coal retirement, energy efficiency, renewables, transportation electrification, equity, and transmission. In the messaging they developed, the local governments expressed which elements of the IRP were 1) appreciated and in alignment with their goals, and 2) didn’t align with their goals and required further actions. On elements where the partners were seeking further actions, they compiled research to enhance their positions, precedents for the NCUC and Duke Energy to consider, and opportunities where the local governments could support their requests.

Once the local governments crafted their initial message, each jurisdiction finalized their specific regulatory engagement method (i.e., individual or joint public comment and informal or formal intervention), obtained approval from their attorneys and senior leadership (e.g., a mayor, city council, or board of commissioners), and worked to scale the effort. Although they were working collaboratively, each local government also retained the flexibility to choose the engagement method(s) that worked best for their unique jurisdiction.

Map of North Carolina local governments that participated in 2020 Duke Energy IRP process.

Ultimately 15 local governments submitted the following:

  • The City of Charlotte formally intervened based on Charlotte’s Strategic Energy Action Plan and their localized energy burden facing low-income communities of color.
  • The City of Asheville and Buncombe County formally intervened with a detailed joint letter.
  • Eleven cities and counties signed on to a joint public letter, one of the largest collaborative efforts by local governments to date. Signatories included: Town of Boone, Town of Carrboro, Town of Chapel Hill, City of Durham, Durham County, City of Greensboro, Town of Hillsborough, Town of Matthews, Orange County, City of Raleigh, and the City of Wilmington.
  • The City of Raleigh submitted an individual public comment in addition to signing onto the group letter mentioned above.
  • The Town of Cary submitted an individual public comment.

While local governments reported some near-terms impacts, such as an increased interest in future regulatory engagement by local government leadership, other impacts weren’t clear until after the legal proceeding concluded, which took most of 2021. In the end, many of the local governments’ requests from their IRP comments were reflected in NCUC’s final IRP ruling, as well as in other regulatory decisions and legislation finalized in the following months.

What were local government partners’ biggest challenges in setting up this project?

Starting the engagement process earlier: The IRP development process begins long before a draft plan is filed. Local governments often have an opportunity to engage with their utilities early on to understand and influence a utility’s internal analysis and stakeholder process prior to the plan being filed. In North Carolina, several local governments directly engaged with Duke Energy in this way but by the time most local governments were aware of the IRP, this window of opportunity had passed.

Streamlining the process of gathering signatures: For local governments who chose to submit their own letter, the process for gathering approval signatures from city attorneys and elected officials was simpler. Coordinating signatures on the joint letter was more complicated, as it entailed compiling both physical and electronic signatures for each jurisdiction with varying timelines for approval.

What advice would this collection of local governments give to other local governments as they pursue climate action projects?

Communicate directly with the electric utility from the beginning and share that the local government will be participating in stakeholder engagement processes: These actions could result in stronger collaboration and reduce the chance that a utility relationship will be compromised. Additionally, early engagement provides a forum for a local government to understand the regulatory environment as well as any limitations that a utility faces, while also creating space for a utility to understand local government interests and needs.

Recruit partners and technical experts to support IRP engagement efforts: Partners can provide local government staff with education, data, and guidance on the opportunities and engagement pathways available. For example, the North Carolina local governments engaged with partners that:

  • Explained the general IRP process and national IRP trends (World Resources Institute and RMI);
  • Supported coordination, scaling, and communication (Southeast Sustainability Directors Network);
  • Could speak to the unique state environment and other complementary advocacy efforts (Environmental Defense Fund); and
  • Had deep technical knowledge of the specific utility and its IRP scenarios (GridLab)

Coordinate with other local governments to learn from others, share resources and capacity, and amplify shared messages: This was a novel effort for most of the North Carolina local government partners. If any of them had attempted to do it alone, it may have required more staff time and resources than were available. While several of the partners decided to submit individual public comments or formal intervention letters, all reported that working together on education and shared messaging helped to leverage limited resources and capacity, increase inclusivity, and create a larger, stronger, collective voice to influence their local utility IRP process.

“The IRP is also an opportunity for Duke Energy to chart a course for how the utility will work directly with local governments to (1) prevent disproportionate and adverse health impacts to the customers already most impacted, and (2) offer energy efficiency and renewable energy programs that help achieve our shared equity goals.”

Joint Comments Submitted to NCUC by Town of Boone, Town of Carrboro, Town of Chapel Hill, City of Durham, Durham County, City of Greensboro, Town of Hillsborough, Town of Matthews, Orange County, City of Raleigh, and the City of Wilmington

Engage local government leadership early in the process to facilitate smoother future approval processes: The first regulatory engagement that a local government undertakes will likely require more time, effort, and education; however, subsequent efforts should be more streamlined. A proactive measure would be to seek a mandate and approval from leadership for sustainability/energy staff to regularly participate in the IRP process on behalf of advancing the local government’s climate or energy goals. The North Carolina local governments have since participated in subsequent regulatory proceedings and reported that it has been easier to obtain leadership approval.

How does this project fit into the local government partners’ broader climate and community goals?

This project builds upon Metro’s role in providing sustainable transportation options to residents, In November 2021, NCUC issued a final ruling stating that Duke Energy’s IRPs was adequate for short-term planning purposes. However, the ruling also provided further direction for future planning efforts. For example, the Commission directed Duke Energy to include more information about transmission analysis, coal retirement dates, energy efficiency, and demand side management into future IRPs and to develop a carbon plan in 2022.

Measuring the direct impact of one individual’s regulatory engagement is inherently difficult. Nevertheless, many of the local governments’ requests were reflected in NCUC’s final ruling on the IRP. Additionally, discussions around the ongoing IRP regulatory process may have had a spillover effect into the North Carolina 2021 Legislative Session. House Bill 951 from the 2021 session includes topics raised by the local governments and other stakeholders in the IRP process, including requirements for competitive procurement of new solar, 4 GW of new solar, on-bill financing of energy efficiency, and more. The number of stakeholder voices sharing a unified message may have encouraged regulators and legislators to consider these issues more seriously.

“[We] see an opportunity for Duke Energy to meet emerging energy and capacity needs not with new gas plants, but with clean energy portfolios that provide a broad range of benefits for customers, including lower customer costs, reduced emissions, and enhanced reliability. We therefore encourage Duke Energy to explore — and the Commission to require — a competitive, all-source procurement process.”

Joint Comments submitted to NCUC BY Jannice Ashley, City of Ashville Senior Assistant City Attorney & Curtis Euler, Buncombe County Senior Attorney

Finally, this experience provided a valuable educational opportunity for local government staff and leadership along with a deeper appreciation for how local government voices can impact the IRP process. By uniting and growing their voices, these partners collaborated with Duke Energy and NCUC to make sure their goals and needs could be met with the utility’s IRP. The local governments involved have since reported other tangential impacts of this effort, including an increased interest in future regulatory engagement by local government leadership, a better understanding of Duke Energy’s processes and priorities, and identification of future opportunities for local government–utility collaboration.

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