McCrory says more diverse energy ahead for NC

Dec. 05, 2013 @ 05:00 AM

North Carolina is poised for an economic boost thanks to laws authorizing fracking and by opening the door wider to more alternative energy production, Gov. Pat McCrory predicted Wednesday before state business leaders.

Pushing ahead on his "all of the above' energy strategy, McCrory also said President Barack Obama's administration keeps dragging its feet on re-opening the process to recommence energy exploration off the Atlantic coast. The federal government has decided not to open exploration in new waters through at least 2017.

"We have to get into the exploration business in North Carolina," McCrory told participants in an energy conference organized by the North Carolina Chamber. "We've waited far too long to begin that process and we've wasted a lot of time and we need to get that process going."

Over objections from then-Democratic Gov. Beverly Perdue and environmental groups, the Republican-led legislature last year directed a state commission to develop rules for fracking, or hydraulic fracturing, for natural gas. Shale deposits containing the gas are most likely to be found in the Piedmont and Sandhills.

Lawmakers told the panel to have rules completed by next October, but permits can't be issued unless the legislature formally acts again. McCrory said he wants to get a permitting process started in 2015 "so we can begin the process of finding out exactly how much natural gas we have in several counties." Critics say the potential from projected gas reserves aren't that great and not worth the potential threat to the environment.

McCrory said exploration is part of a two-pronged approach to make the energy industry a sector that will help North Carolina come roaring out of the recession. The other, he said, is promoting power generation. Charlotte-based Duke Energy Corp. is the nation's largest electric power company. McCrory, who previously worked for Duke, said the state needs to look at tax policies that promote power generation.

The governor on Wednesday praised a law passed in 2013 laying out the regulatory framework for building wind farms to create energy.

McCrory also said he wants to examine next year the balance between what he called subsidies received to produce renewable energy and the rates charged to consumers.

The state House debated this year but ultimately rejected legislation that would have scaled back and later repealed 2007 requirements that North Carolina electric companies generate a set portion of power through efficiencies and alternative sources like solar, wind and animal waste. The utilities are allowed to create a surcharge on the bills of home and industrial customers to help meet the standard. The surcharge has been quite small so far.

"We have to give a clear signal regarding what's government's role and what the utilities' role will be in renewable investments," McCrory said, adding "at what point in time will do the subsidies slow down or end or decrease?"

Ivan Urlaub, executive director of the North Carolina Sustainable Energy Association, said McCrory is asking good questions. But he cautioned against pulling back on incentives that are "putting renewables on a path to become some of our cheapest resources."

"It's in the ratepayers' best interest that we get these renewable resources to scale and get the price down because we're going to need them if we want affordable energy in the future," Urlaub said in an interview.

McCrory also announced he'll be the next vice chairman of the Outer Continental Shelf Governors Coalition, which wants the federal government to open coastal waters to more oil and gas exploration.