Duke Energy might abandon a project to experiment with distributed solar energy unless North Carolina state regulators change their minds about how the utility can recover the project’s cost.

Duke petitioned the North Carolina Utilities Commission Thursday to remove the limits the commission set last December. Back then, the commission said Duke could only pass on part of the $50 million project cost onto ratepayers under the state’s 2007 renewable energy law. The utility might be able to recover the rest of the cost in a separate process.

Duke now says those restrictions could force it to violate federal accounting rules governing how the utility can take advantage of up to $250 million in investment tax credits.

The solar project has run into problems since Duke announced it last summer. The company initially set out to get permits for installing 20 megawatts worth of solar panels at residential, commercial and even school properties. The idea is to invest $100 million in a project that would enable it to meet the state’s renewable energy mandate while exploring the concept of distributed power generation.

Distributed power generation means producing electricity close to where it’d be used. That’s a different approach than the traditional, centralized power generation (i.e., coal-fired power plants).

Duke cut the project in half last October after critics said the project was too expensive and that the utility should’ve allowed other power producers to participate.