NC senators seek federal official’s help assessing solar projects

Two North Carolina state senators are asking a top federal Energy Department official for help as the state assesses costs and benefits of new solar energy projects.

Sen. Tim Moffitt, R-Henderson, and Sen. Buck Newton, R-Wilson, requested assistance in a March 11 letter to Deputy Secretary James Danly of the US Department of Energy.

Moffitt chairs the North Carolina Joint Legislative Energy Policy Commission. Newton serves as vice chair. Both senators serve as members on the Southern States Energy Board.

“We write to request DOE’s technical perspective on an issue state regulators increasingly confront when evaluating utility-scale solar and solar-plus-storage projects: the persistent exclusion of material system costs that are directly caused by these resources but routinely socialized across the broader grid,” Moffitt and Newton wrote.

State law directs the North Carolina Utilities Commission “to approve generation resources that are least cost while maintaining or increasing reliability,” the senators explained.

The letter turns next to comments from Danly’s boss, US Energy Secretary Chris Wright. He “has made closely related observations in public remarks about wind and solar (and solar-plus-storage) — including that intermittent resources provide limited value when they are not available at peak, can require other resources to ramp up and firm to maintain reliability, and that the resulting costs can show up in higher bills borne by customers,” Moffitt and Newton wrote.

“He has also argued that in jurisdictions with higher wind and solar penetration, prices have risen while system stability has declined, and that these impacts are not always transparent in how intermittent resources are evaluated,” the letter continued.

The letter lists costs tied to solar projects that are “foreseeable, recurring, and essential for reliability” but are typically excluded from project evaluations. Among those costs are grid upgrades, battery replacements, and costs linked to traditional energy sources that back up new solar projects.

“Guidance from DOE affirming the importance of evaluating these costs explicitly — rather than implicitly or system-wide — would be extremely helpful to commissions seeking to make prudent, technology-neutral, least-cost determinations consistent with statutory reliability obligations,” Moffitt and Newton wrote. “From a state perspective, federal technical guidance to regulators would be far preferable to pursuing statutory changes to address cost-attribution concerns. Even high-level principles on cost causation and attribution could materially irnprove the rigor and transparency of state proceedings.”

The two senators suggested that DOE guidance could have an impact beyond North Carolina.

“A more rigorous accounting of the full, system-level costs attributable to solar and solar-plus-storage would also have major implications for resource choice in North Carolina and across the county,” Moffitt and Newton wrote.

The senators’ letter echoes concerns Utilities Commissioner Donald van der Vaart has shared in a series of solo dissents to the commission’s approval of new solar projects since September.

“The majority once again approves of a solar-generating facility without performing the legally required analysis of whether the resource, as actually deployed on the grid, is the least-cost means of providing reliable electricity under N.C. Gen. Stat. § 62-110.1,” van der Vaart wrote on Dec. 11. He dissented from the commission’s 4-1 decision to approve a new 67-megawatt solar project in Wayne County.

“The statutory directive could not be clearer: the Commission must determine — not infer, not assume, not defer — that a facility is both least cost and able to meet system reliability needs before authorizing construction,” van der Vaart wrote. “The record in this docket does not allow such a determination.”

“[T]he Commission continues to approve intermittent renewable energy projects without adequately accounting for their full costs to ratepayers,” van der Vaart argued.

Duke Energy Progress presented “stand-alone costs” for the Deerwood Solar Center in Wayne County, the dissent explained. “These figures tell us what the plant costs when the sun is shining and the batteries are charged,” van der Vaart wrote. “They do not tell us what it costs to ensure power is available the other 79% of the time, when this facility contributes nothing to the grid. A generating resource that performs part-time cannot be evaluated against full-time sources based on part-time costs.”

Van der Vaart called for additional information about the “costs of firming resources necessary to provide reliable power when the solar facility does not generate electricity, such as during non-daylight hours, cloudy conditions, or periods of low solar irradiance.” He also asked for “[e]nhanced operations and maintenance (O&M) costs” for backup energy sources that ramp up and down because of solar energy’s inconsistent reliability. The dissent also cited the lack of information about specialized grid equipment required to deal with intermittent solar power.

The Utilities Commission’s duty “is to determine, on evidence, that the resource being approved is the least-cost method of providing reliable service,” van der Vaart wrote. “That determination cannot be made when entire categories of acknowledged and required costs — firming, battery replacement, grid integration, cycling — are omitted.”

“NC senators seek federal official’s help assessing solar projects” was originally published on www.carolinajournal.com.