- Electricity rate increases for utilities affected by North Carolina’s Carbon Plan law have outstripped the state average rate increase
- The law originated under Gov. Roy Cooper as the Clean Power Plan, which by design elevated climate ideology over affordability and reliability
- Repeal of the Carbon Plan law is the only way to restore affordability and reliability as the top values in state electricity policy
Power bills are getting worse in North Carolina. While families try to cope, high rates have grabbed the attention of news media and politicians such as Gov. Josh Stein, Attorney General Jeff Jackson, and former Gov. Roy Cooper. Strangely, they don’t focus on fixing the state policies behind the higher rates.
A new report from the John Locke Foundation does, however. The report, “Energy Poverty in North Carolina: Securing Affordable, Reliable Power,” offers several policy recommendations to uphold affordable, reliable electricity and protect households most at risk of energy poverty.
A previous research brief discussed the report’s recommendation regarding data centers. This one will discuss the report’s top recommendation: repeal of the state’s Carbon Plan law.
Large electricity rate increases under the Carbon Plan law
In 2022, during the initial Carbon Plan discussions, the Locke Foundation provided analysis to the North Carolina Utilities Commission (NCUC) showing that the four portfolios then under discussion were all too expensive. We also demonstrated that achieving the law’s requirements as cheaply and reliably as possible would still increase electricity rates.
Since the Carbon Plan law was passed, customers for Duke Energy Carolinas and Duke Energy Progress “have seen their electricity prices increase by 36.3% and 29.7%, respectively, outpacing the state average increase of 25.4%.”
In 2023, the NCUC heard testimony from utilities engineer Dustin Metz of the NCUC’s Public Staff warning that customer rates could “approximately double” before 2030.
That process is playing out. A new report from the Institute for Energy Research and Always On Energy Research shows that since the Carbon Plan law was passed, customers for Duke Energy Carolinas and Duke Energy Progress “have seen their electricity prices increase by 36.3% and 29.7%, respectively, outpacing the state average increase of 25.4%.”
Those are already significant spikes, but the Carbon Plan law’s impact on rates is still ongoing.
Why does North Carolina have a Carbon Plan law?
The Carbon Plan law originated in 2019 under former Gov. Roy Cooper as part of his joining the United States Climate Alliance in 2017, a group of governors seeking to “fight against climate change” and impose the Paris Climate Accords through extreme state-level policies. The ends of such policies include, among other things, getting rid of gas- and diesel-powered vehicles and farm equipment, revamping building codes, getting rid of gas stoves and appliances, making state permitting decisions include “environmental justice,” incorporating “social cost of carbon” charges, and replacing traditional power plants with unreliable, weather-dependent renewable facilities.
For some reason, Cooper did not want his involvement with the climate alliance to be highlighted. A portion of an organizational email chain noted the following:
Source: Climate Litigation Watch
Cooper’s Executive Order 80 of 2018 ordered the state to “honor the state’s [meaning Roy Cooper’s] commitments to the United States Climate Alliance.” Doing so included, among other things, developing a “Clean Energy Plan” for North Carolina. This plan sought to force a “70% reduction in power sector greenhouse gas emissions below 2005 levels by 2030 with carbon neutrality by 2050.”
Cooper’s plan relied on input from 166 environmentalist and other “stakeholder” groups. They took a poll of themselves to learn what “[v]alues to prioritize going forward” in electricity provision and found “overwhelming consensus around the Environment and Carbon Reduction value,” far above all others, including affordability and reliability.
The Cooper Administration’s Clean Energy Plan: Stakeholders’ Values for Electricity Provision
Source: North Carolina Department of Environmental Quality, “North Carolina Clean Energy Plan,” draft report
Longtime North Carolina utilities law requires adequate, reliable power as affordable as possible, but those are the very values Cooper’s Clean Energy Plan subjugated to “environment and carbon [dioxide] reduction.”
In 2021, the North Carolina General Assembly began debating House Bill (HB) 951, which originated as a bill to study advanced small modular reactors and other “emerging energy generation sources, issues, and trends.” Along the way, the bill was essentially transformed into Cooper’s Clean Energy Plan, promising “to achieve a seventy percent (70%) reduction in emissions of carbon dioxide (CO2) emitted in the State from electric generating facilities … by the year 2030 and carbon neutrality by the year 2050.”
The key difference between Cooper’s plan and the resulting Carbon Plan law was HB 951’s addition of critical guardrails. The plan must be “reasonable,” set forth the “least cost path consistent … to achieve compliance with the authorized carbon reduction goals,” and “maintain or improve upon the adequacy and reliability of the existing grid.”
We warned then this law would absolutely mean higher electricity rates. That’s why we said that only by “strict adherence” to the affordability and reliability guardrails could lawmakers prevent even higher rate increases under this law. Fortunately, in 2025, the General Assembly took just such action.
Legislators learned that the Carbon Plan law’s interim goal (70 percent reduction of CO2 emissions by 2030) was having a very expensive impact on the NCUC’s computer modeling used to implement the plan. As described here, they learned that it effectively placed a carbon tax of “$10,000 per metric ton of CO2emitted” on new natural gas plants and that eliminating the interim goal would save consumers an estimated $13 billion by 2050. This revelation led to the passage of Senate Bill (SB) 266, despite Gov. Josh Stein’s veto.
Stein is also a member of the United State Climate Alliance.
How does the Carbon Plan law affect electricity rates?
The heart of NCUC’s Carbon Plan is to close down working power plants and replace them increasingly with intermittent and unreliable solar and wind facilities. Our report showed just how disparate the costs of power plants are, not just between existing power facilities and new ones, but also among different kinds of power plants (see the following graph from the report).
Source: “Energy Poverty in North Carolina: Securing Affordable, Reliable Power,”
The report explains that existing nuclear is the cheapest source, followed by natural gas combined cycle and coal. Existing or new, those are also the most reliable sources of electricity. Nevertheless, the power sources that the Carbon Plan requires, exclusively by 2050, are by far the most unaffordable and unreliable ones.
Such an outcome is to be expected from making policy to appease climate zealots without respect for affordability and reliability.
What is the solution?
Our report’s recommendation is clear:
Repeal the Carbon Plan Law
By far the cheapest sources of electricity are existing power plants, not new builds. Under the Carbon Plan law, all of North Carolina’s baseload coal-fired power plants — one-fourth of the state’s current capacity — would be retired.
North Carolinians need policymakers to restore affordability and reliability as the top values in the state’s electricity policy. It cannot happen without repealing the Carbon Plan law and any other policy that elevates ideology over affordability and reliability.
