An ambitious attempt to rewrite state laws to expand the solar industry and lower its cost may be in trouble after Senate leaders made big changes to the carefully negotiated deal.
House Bill 589 is the end result of nine months of stakeholder negotiations between utilities, clean energy groups and other advocates. It passed the House in early June, 108-11, with the strong support of House Speaker Tim Moore, who convened the workgroup that crafted it.
However, Senate leaders changed several provisions and added others, leading major stakeholders to withdraw their support for the proposal.
The most controversial provision added by Senate Majority Leader Harry Brown has nothing at all to do with solar energy. It’s a moratorium on state permitting for wind-energy projects through Dec. 31, 2020. That provision, filed by Brown as a standalone bill, was also included in the Senate’s budget proposal but was not part of the final budget deal.
In the Senate Rules Committee on Tuesday morning, Brown, R-Onslow, insisted the wind moratorium is needed to “protect the state’s military bases” in the anticipated next round of base closures by the U.S. Department of Defense because wind farm development is not compatible with the training corridors needed for military aircraft.
“If those bases were to leave either Goldsboro or Cherry Point, I can’t tell you what it would do to those economies,” Brown said. “To not protect that resource, I think, would be a huge mistake.”
Seymour Johnson Air Force Base is in Goldsboro, while the Marine Corps has an air station at Cherry Point.
Brown said the “short step back” is needed to allow a Washington, D.C., lobbying firm to complete new maps showing where wind energy development would not conflict with military needs in eastern counties. Completing those maps, he said, would provide “certainty” to the military and the wind industry.
Several Democrats on the committee pointed out that the DOD has told state regulators and lawmakers for years that it neither wants nor needs a moratorium on wind energy development, and that wind farms aren’t incompatible with bases. They also pointed out the state currently consults the DOD in its permitting process, which already protects those flight corridors by law.
“To just disregard all of that conversation and say ‘no’ for four years, I’m wondering about that,” argued Sen. Paul Lowe, D-Forsyth. “Counties are already doing wind energy development. I want to hear more than that than to just sweep it away. I’m not happy with that answer.”
At least one major project is currently in the pipeline: the Timbermill Wind utility-scale wind farm in Chowan and Perquimans counties, which supporters say would dramatically boost county property tax bases with a $500 million investment. It’s still in the federal permit stage, so developers have not yet applied for state permits. The provision in House Bill 589 would delay that step by four years.
Lumber giant Weyerhaeuser owns the land where the Timbermill project will be built and has already signed a lease agreement with the developer, Apex Energy. According to Weyerhaeuser lobbyist Nancy Thompson, the company, the state’s largest private land owner, also owns the property under the Amazon wind farm near Elizabeth City, which was constructed under the regulations lawmakers approved four years ago.
“We have thousands of acres under lease,” Thompson said, calling the moratorium unnecessary. “We fully support an appropriate permitting process. We think you all passed one in 2013.”
Thompson and other lobbyists said the ban may infringe on the private property rights of Weyerhaeuser and other landowners, but Brown disagreed, comparing it to zoning ordinances in local government.
Asked whether the provision would kill the Timbermill project, Brown answered, “I can’t say if it would or not.”
Brown has been trying to block the expansion of wind energy development in the state for the past two years.
Under the House bill, the North Carolina Utilities Commission would reassess the state’s power needs at the end of 45 months before issuing any further requests for competitive bidding for solar projects. In the Senate bill, the commission would be forbidden from issuing any further RFPs after the 45-month period, effectively ending the proposed expansion.
The Senate version of the measure also includes provisions long sought by solar critics, requiring developers of utility-scale solar projects to provide a bond to the Department of Environmental Quality for financial responsibility for decommissioning, recycling and site restoration when solar farms are taken out of service. Solar advocates say the bond is unneeded because the components of solar cells are so valuable that developers would recycle them as a way to recoup costs.
But skeptics, including House Agriculture Committee Chairman Rep. Jimmy Dixon, R-Duplin, say they’re concerned solar panels could leach harmful substances into the soil at the site, a notion solar developers say is not based in fact.
One after another, the groups that backed the bill told the committee they do not support the Senate’s changes, including the N.C. Sustainable Energy Association, the N.C. Clean Energy Business Alliance and Weyerhaeuser. A lobbyist for Duke Energy, which also opposes the changes, signed up to speak but was not recognized to do so by Chairman Sen. Bill Rabon, R-Brunswick.
(UPDATE: At a later meeting Tuesday, Rabon apologized for the omission and asked Duke Energy spokesman Ken Jennings to speak. Jennings said Duke prefers the original version of the bill, adding, “We respectfully ask for your consideration and reflection on this over the next few days.”)
Environmental groups who took no position on the original bill now oppose it as well.
Sen. Floyd McKissick, D-Durham, asked whether, given the long, difficult negotiations to get to consensus on the measure, it might be better for Brown to run his changes in a separate measure.
“I think this is the perfect bill for it to be in,” Brown replied with a smile.
Rep. John Szoka, R-Cumberland, the House sponsor of the bill, called it “a very good, balanced bill” before asking the committee to approve it so the House and Senate can “take it to conference.”
The bill passed on a voice vote that appeared to split along party lines. It could be on the Senate floor as soon as Tuesday afternoon.
Report details clean energy’s economic impact
Meanwhile, a June 2017 economic impact report by RTI International found that clean energy investments across the state in the last 10 years totaled $9 billion, more than half of which came in the past two years. The N.C. Sustainable Energy Association, a Raleigh nonprofit that advocates for clean energy, paid for the report, an update to a similar analysis issued last year.
Those clean energy investments, which included the funding of both renewable energy and efficiency projects, cost state taxpayers an estimated $611.7 million in government incentives between 2007 and 2016. Yet the report’s authors say clean energy development added $906.3 million in tax revenue for state and local governments through both direct investments and secondary impacts, like spending on related goods and services.
Wind, specifically, drew $388.9 million in investment over the last decade, almost all of it in the rural northeastern counties of Pasquotank and Perquimans. Solar energy projects, by far, soaked up the largest percentage of direct investment at a total of $6.4 billion in counties scattered across the state.
WRAL Reporter Tyler Dukes contributed to this report.