Proposed Energy Efficiency Standard Change Draws Response From Data Center Giants

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Water Down Energy Efficiency

Apple’s Solar Farm in Maiden, N.C.

Google, Facebook and Apple have jumped into a controversy in North Carolina that focuses on a proposed energy efficiency standard change.

These giants own data centers in Rutherford, Lenoir and Catawba counties valued at about $2.7 billion in investments and 200 jobs. Their investments include green data centers and solar energy. For example, Apple has a 100-acre solar farm and biogas energy plant at its Maiden campus.

The controversy centers on efforts to change renewable energy and energy efficiency standards that have been in place since 2007 in North Carolina, says Ryan Miller, founder & executive director at the North Carolina Building Performance Association.

In 2015, utilities must invest 6 percent of retail sales into clean energy, and 25 percent of the 6 percent goes toward energy efficiency. By 2021, that would increase to 12.5 percent of retail sales, with 25 percent of the 12.5 percent going to efficiency.

However, proposed legislation would freeze the standard at 6 percent, said Miller.

One interesting twist: The proposal to freeze the standard would increase the amount of efficiency from 25 percent of the 6 percent to 50 percent of the 6 percent. However, even with that change, the state would see less energy efficiency in 2021 than it would under the original standard.

Under the freeze, 3 percent of retail sales goes to efficiency. Under the standards, 3.5 percent of retail sales would go toward efficiency by 2021.

“Energy efficiency is good for everybody,” says Miller. “In North Carolina, the only rebates and incentives are provided by utilities. It helps them decrease their peak load.  It’s safe to assume that Duke [Energy] benefits from energy efficiency and is investing a lot of money into solar,” he added.

Duke, in particular, has invested a lot into energy efficiency rebates and incentives. Miller is worried that Duke’s and other utilities’ rebates and incentives will end with the freeze because they may have already met the 3 percent of retail sales mark.

“With this bill freezing the standards, it may potentially shut down incentives and rebates offered by utilities because they may have achieved their goals already. We don’t know if they have achieved their goals or if they are below or above them,” says Miller.

Facebook, Google and Apple, writing as “TechNet” members, expressed their concerns in a letter to the North Carolina Legislature.

“As employers and major electricity customers in North Carolina, the undersigned TechNet member companies write today to raise concerns over the energy policy language of H332 (originally found in H760), which we believe would have a significant negative impact on the availability of a clean and diversified energy supply in the state.

“We are concerned the legislation would freeze the Renewable Energy & Energy Efficiency Portfolio Standard (REPS), which provides a steadily increasing baseline of clean energy for the North Carolina grid over time. We believe the REPS should be maintained because our collective experience shows that programs like the REPS can actually reduce the overall cost of energy to ratepayers.”

Miller is a little puzzled about the motives behind the effort — which is backed by Rep. Mike Hager — and is concerned about how it will affect business in the state.
“Companies come to North Carolina because they can know that their investments in solar as generation will last. This bill will cause uncertainty and confusion and concern from other companies. It’s a big problem for business,” he says.
The long-term goal in North Carolina — like other states — is to provide a framework that allows companies like Apple to sell their solar to the utilities at profitable rates. Right now, only net metering is allowed.
The freeze also hurts efficiency, says Miller, because it freezes the state’s roadmap for efficiency, rather than allowing for the planned energy efficiency increases.
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