‘Growing reliability concerns’ top North Carolina regulator’s large load conference

• The North Carolina Utilities Commission will hold a technical conference on October 14 to address “the rising prevalence of large electric load additions in the region,” it said last month.
• The commission’s order cited “growing reliability concerns related to large electric load integration,” pointing to North American Electric Reliability Corporation analyses of more than two dozen recent voltage-sensitive load loss events related to data centers and cryptocurrency mines in the Mid-Atlantic and Texas.
• The move came less than a month after Duke Energy updated its periodic large electric load forecast to 5.9 GW by 2035, an increase of nearly 2 GW from 12 months earlier, and after Amazon announced it would invest an estimated $10 billion in North Carolina data centers.

In its technical conference order, the commission asked Duke and Dominion to weigh in on whether new tariffs should be developed for some or all customers above a certain demand threshold; whether those tariffs should address customer self-generation, sensitivity to grid disturbances and other reliability issues; cost allocation and potential “stranded cost issues” for new large loads; and possible modifications to North Carolina’s interconnection procedures needed to accommodate large loads.

The commission also asked the utilities to provide updates on ongoing negotiations with data centers and other large load customers, including plans for backup generation, co-location with generating facilities and “measures that will need to be implemented to ensure grid reliability and fair cost to customers” for such co-located facilities.

Tyler Norris, a Duke University Ph.D student and former renewables development executive who published a widely cited paper on large-load flexibility earlier this year, said North Carolina lacks the transparency needed for the public to gauge the potential impact of proposed large loads on utility rates, the environment and the state’s progress toward its legislative mandate for 100% carbon-neutral electricity by 2050.

“Like most states, North Carolina has no interconnection procedures or transparency standards for large loads, which means at this time there’s essentially no information available about the proposed facility,” Norris said.

Amazon, for example, did not disclose a potential load for its North Carolina data center investment in its early June announcement. But based on the most likely design specifications, it could eventually be between 600 MW and 900 MW, Norris said.

“The facility’s power rating can’t be known without more detail,” he said. “We don’t know how much power the facility will use, what upgrades it will require, how much those upgrades will cost or who will pay, whether it will include on-site generation or storage, participate in demand response or procure clean electricity.”

Duke Energy’s most recent wholesale load forecast, issued in May, includes “two discrete projects that ramp up over the planning period and will total nearly 900 MWs by 2035,” the commission said in the order.

“Duke Energy’s advanced system planning for the Carolinas is guided by a stringent regulatory process designed to ensure infrastructure investments are grounded in sound load forecasts,” Duke Energy spokesperson Garrett Poorman told Utility Dive in an email.

While the total number of potential large load customers in advanced development stayed roughly the same from 2024, Duke’s May forecast shows a nearly 50% jump in expected future wholesale loads due to an increase in average project capacity, the utility said. Of 35 projects in advanced development, nine projects totaling 540 MW have executed energy service agreements and 22 projects totaling 4,669 MW have executed letters of intent to interconnect, the commission said.

Duke’s forecast includes potential large loads to be served by North Carolina electric cooperatives or municipal utilities that purchase wholesale power from the utility, the commission noted.

Last year, Duke proposed a new electricity tariff in the Carolinas to support large-load customers’ clean electricity goals without raising costs for other ratepayers. The proposed Accelerating Clean Electricity tariff would initially serve Amazon, Google Microsoft and Nucor, a Charlotte-based steelmaker with significant operations in the region, and “facilitate beneficial on-site generation at customer facilities, participation in load flexibility programs and investments in clean energy assets,” Duke said.

Poorman, the spokesman for Duke, said the utility is taking additional measures to mitigate large loads’ impacts on other ratepayers.

“We’re evolving our performance provisions and contracts to ensure large-load customers appropriately pay for the cost to serve them, including termination penalties and minimum bills if we make infrastructure upgrades to serve a new customer whose plans subsequently change,” Poorman said.

He also said robust planning could mitigate some impacts, including siting some energy-intensive customers in areas where the utility already has robust transmission infrastructure and capacity, reducing the need for new grid infrastructure.

Meanwhile, Dominion Energy’s 2024 integrated resource plan for Virginia and North Carolina shows 8,012 MW in data center energy service agreements through 2032, the commission said. Given Dominion’s relatively small footprint in North Carolina, much of that capacity is likely in Virginia, where the commission flagged two major recent load loss events that it said underscore reliability concerns in grid zones where transmission-connected large loads are common.

Earlier this month, the North Carolina Legislature passed a bill that would have encouraged new natural gas and nuclear generation by eliminating the state’s interim power-sector emissions-reduction target of 70% by 2030. It would have also allowed public utilities to charge customers for baseload electric generating facilities “outside of a general rate case if the Utilities Commission determines there is an overall cost savings for customers over the life of the generating facility.”

But Gov. Josh Stein, D, vetoed the bill on Thursday, saying in a statement that “as our state continues to grow, we need to diversify our energy portfolio so that we are not overly reliant on natural gas and its volatile fuel markets.”