Duke Energy has upped its net-zero carbon by 2050 goals, pledging to eliminate methane emissions from its natural-gas business by 2030 through a combination of better pipeline leak detection, more efficient operations and investing in renewable natural gas to reduce the carbon-intensity of its supplies.
The new goals outlined in Duke’s environmental, social and governance day presentation on Friday were among a host of incremental advances on last year’s commitment to reach net-zero carbon emissions by 2050. The new goals include shifting the $2 billion earmarked for the canceled Atlantic Coast Pipeline project to its $58 billion five-year capital plan, which calls for doubling its share of renewables from 8 gigawatts to 16 GW by 2025.
Further, a new 10-year capital plan calls for tripling renewable capacity for its regulated utilities to 24 GW by 2030 in a push to halve its carbon emissions by then, and bringing that total to 40 GW by 2050. The 10-year plan calls for retiring all coal-fired units in North and South Carolina by 2030 and adding 11 GW of energy storage across all territories by 2050.
Duke will still rely on natural gas for much of its generation capacity across the six states it serves by 2030. Its 15-year integrated resource plan (IRP) states that failing to build new natural-gas plants to supply future load growth could increase customer costs significantly. Environmental and clean energy groups have attacked Duke’s plan for continuing to rely on natural-gas-fired power plants that emit carbon.
Getting rid of the carbon emissions from that fleet by 2050 will require a combination of long-duration energy storage and next-generation nuclear reactors to bolster to supply power when solar and wind aren’t available, as well as carbon-neutral replacement fuels such as hydrogen produced with renewable electricity, CEO Lynn Good said in Friday’s presentation.
Methane leakage from natural gas pipelines
Duke's new methane targets are focused on its natural-gas distribution businesses, including Piedmont Natural Gas in the Southeast and its Duke Energy gas business in the Midwest. “We intend to be a leader in reducing methane emissions,” Good said.
Methane, which makes up 96 to 98 percent of natural gas in U.S. pipelines, is about 28 times more potent as a greenhouse gas than carbon dioxide, according to the U.S. Environmental Protection Agency. Recent studies indicate that the U.S. oil and gas industries leak about 2.3 percent of all the natural gas they produce, a level that threatens to overwhelm the carbon emissions reductions to be gained by replacing coal-fired power plants with natural-gas power plants if it’s not brought in check.
Duke has already spent about $1 billion to replace cast iron and bare steel main pipelines with stainless steel and plastic-coated pipes to reduce leakage, said Sasha Weintraub, Duke's senior vice president and chief commercial officer of natural gas, on Friday.
In the coming decade, Duke intends to use drone aircraft and satellite reconnaissance to detect leaks more quickly across its more than 60,000 miles of gas pipeline infrastructure, a method it's testing in pilot projects today, Weintraub said. The company is also increasing its inspection of distribution gas pipelines from every five years to every three years, and plans to improve operational efficiencies and damage-prevention initiatives to reduce leakage, he said.
Duke has also joined the One Future coalition of natural-gas companies pledging to reduce methane emissions from wellhead to end customers to less than 1 percent of the overall volume of supply by 2025. Part of that effort will "be using our purchasing power to encourage our natural-gas suppliers to use low methane emission practices," Weintraub said.
Investment in the renewable natural gas sector
Despite those efforts, the utility "may need some offsets to achieve our goals, and if we do, we’ll be using renewable natural gas,” Weintraub said. Renewable natural gas (RNG) is captured from livestock farms, wastewater treatment plants, landfills and other major sources of rotting organic material, and processed to remove water, carbon dioxide and other contaminants that would otherwise prevent its use in existing natural-gas pipeline systems.
"We're executing a five-year plan to be a leader in the renewable natural-gas space," Weintraub said.
In January, Duke partnered with Smithfield Foods, the country’s largest hog farming and pork processing company, to take RNG from a $14 million biogas capture and conversion system at its Tar Heel, North Carolina wastewater treatment facility and inject it into its Piedmont Natural Gas system. In July, the utility invested in SustainRNG, a company planning to build its first biogas capture and RNG processing projects at dairy cow facilities in the Southeast by next year.
Capturing biogas can yield significant greenhouse-gas reduction benefits, and it can be used for on-site heating or power generation applications without the expensive processing required for pipelines. But using it in pipelines remains a costly proposition today, with costs of very large-scale RNG production about three times higher than average fossil natural gas costs, and small-scale RNG production about 10 times higher, according to a July EPA report.
A lack of financial incentives for using RNG in lieu of fossil natural gas has stymied the investments needed to scale up production. Today, some of the most valuable incentives for RNG come from clean fuel standards for natural-gas-fueled vehicles, such as California’s low-carbon fuel standard.
Last month, Piedmont Natural Gas started selling RNG at one of its 11 compressed natural-gas fueling stations, offering owners of CNG vehicle fleets an option for reducing their carbon footprint to meet internal goals or regulatory mandates. Whether or not RNG can scale up to meet a significant fraction of Duke’s overall natural gas demand will depend on changes to state and federal regulations to incentivize its development.
To reduce any remaining emissions by 2030, Duke plans to use net-carbon offset techniques such as reforestation projects or bioenergy with carbon sequestration.