we had the policies in place, it sent enough market signal for Iberdrola, and many other developers, to come to this state and prospect and engage landowners and local government. They were able to continue in both their technology and business model, and find ways to take advantage of what is there in terms of regulatory construct and access to PJM (the regional transmission organization that manages the grid in the region), to get a project done. It’s a massive benefit, not just to the local economy—$400 million investment—but also ratepayers. Now all that wind energy is going to be pumping into the grid in the next year at a really affordable price.
X: What about offshore wind, where the wind energy potential is greater?
IU: We know we have this phenomenal, and the largest, resource potential—even after excluding for all sorts of military, economic, and environmental considerations. We don’t have strong east-west transmission capacity. We have a transmission group of utilities and others that have been looking at that in North Carolina the last couple of years. BOEM [Bureau of Ocean Energy Management] has been taking positive steps forward allowing us to being able to have leased sales out in the ocean. But it seems like we’re still quite a ways away.
X: So the economics still need to be worked out?
IU: Being almost solely a least-cost state in terms of electricity regulation, either they’re going to need to contract with entities outside of the state and be able to somehow move that power to others, like PJM, or come up with some contractual arrangement. Or we’re going to have to find a way to make it work with our utilities in the state. It raises real questions. Duke Energy may be the largest market cap IOU [investor-owned utility] in the country, but they’re one fifth the size of Electricte de France. EDF can build out a whole bunch of nuclear power plants to just to keep their nuclear workforce fresh. When someone shows up and builds several thousand megawatts of independent power, it can fundamentally, deeply disrupt [Duke’s] financial stability and viability as an IOU—even the largest in the U.S.—if they don’t have a role.
We almost had a pilot project for utilities signed off on between South Carolina and North Carolina a couple of years ago. But it came down to the last day and Duke just wouldn’t sign on to it. So North Carolina could arguably be in the initial stages of construction right now on a 40 MW offshore wind farm if Duke had signed on to it, but they didn’t.
X: What’s your sense of the environment for cleantech startups? The Council for Entrepreneurial Development releases an annual report on funding. Cleantech is always at the bottom in terms of number of deals and dollars raised. How do you see the cleantech environment for startups?
IU: That’s not my area of expertise, but I’m learning a lot more—our whole organization is—because we’re partnering more and more with organizations like CLT Joules [a cleantech accelerator based at Packard Place in Charlotte]. What I have spent a lot of time thinking about and talking to our government about for the last few years is raising the question: Why do we see so many of our startups not be able to demonstrate and scale in North Carolina? Quite often our most successful startups in the clean energy space end up deploying product or service outside of the state. You can’t really be an innovation-based economy if you’re just really good at housing startups … if they don’t have a pathway or market opportunity for growth here, or arguably in the Southeast, what’s to keep them here when they start to succeed? Our industry clusters are prominent and strong but they mostly export. At some point, we need to understand what can change, and how.
