Getting serious about energy independence

April 3, 2022

As the war in Ukraine, geopolitics and the whims of Big Oil send gas prices and energy costs on a rollercoaster, more and more voters are thinking seriously about the future of America’s dependence on fossil fuels. With rapid advances in renewable energy technology, the cost of energy from sources like solar and wind power is plummeting right as consumers are seeing just how sensitive fossil fuel costs are to unpredictable external shocks.

In the most recent Carolina Forward polling, we asked voters about their appetite for expansion of renewable energy. The results demonstrated broad, majority support for a transition to wind and solar power sources:

Built into this survey question was the key caveat of a tradeoff: would voters support more renewable energy even if it meant an increase in energy costs? While there is no particular reason to assume that a transition to renewable energy would actually entail such an increase, framing the question as involving a tangible cost does help to elicit the strength of respondents' views. And that strength is quite clear, with a clear majority of 56% of voters in favor of expansion of renewables, with only 37% opposed.

Unfortunately, these results also show a clear partisan polarization on the issue of renewable power. Republican respondents were a significant outlier compared to mainstream opinion, with 58% in opposition.

The energy landscape is not, of course, confined to only renewables and fossil fuels. Nuclear power currently accounts for 34% of net power generation in North Carolina. In this survey, respondents were reasonably supportive of expanding nuclear power in the state as well:

Duke Energy, North Carolina's regulated monopoly energy provider, currently operates three nuclear power plants in the state. There are only two other nuclear reactors currently under construction in the United States - both of them in Georgia. Their construction is expected to cost $25 billion.

To meet carbon reduction targets while also meeting energy demand (which rises every year), regional energy utilities like Duke are under pressure to diversify their power generation sources. Yet, as public companies, they are also responsible for meeting quarterly targets set by Wall Street investors, and returning cash to shareholders. In its 2021 Annual Report, Duke Energy reported that it raised its quarterly shareholder dividend in both 2021 and 2020, for an annual total in 2021 of $3.1 billion. (See Page 51 of the linked annual report.)

Also included in the report: renewable energy still accounts for only 2% of Duke Energy's total generation capacity - the same as in 2020.

The only way to meet increasing energy demand without doubling down on fossil fuels is either a historically unprecedented expansion of renewables, or significantly scaling up nuclear power generation (plus still growing renewables). No matter what, nuclear power is likely to play a significant role in the overall energy mix in any transition away from fossil fuels. Voters are also strongly supportive of pushing Duke Energy towards a faster transition to renewables (see Voters Want Renewable Energy).

Yet nuclear power is not a silver bullet solution. It is extremely capital-intensive (eg. expensive) to construct, and for obvious reasons, faces significant regulatory scrutiny for safety and regular maintenance. Traditional nuclear fission produces waste, which must be carefully and safely stored indefinitely. Most fundamentally, however, it still fixes consumers into a "hub and spoke" model of energy, where consumers are forever dependent a single corporate provider - as they are today, with Duke Energy.

By contrast, a more distributed model of small-scale, even individual, producers, producing unlimited free electricity courtesy of the wind and sun, would be both more resilient, cheaper and safer. But such an alternative is very unattractive from the perspective of Duke Energy, which would strongly prefer all consumers buy their electricity at retail rates from them. This is really the difference between "Energy Independence" as a bumper sticker motto, versus an actual operating model: who produces the energy, and who gets to charge for it? Voters' preferences are clear.

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