North Carolina Energy Debate Shifts to Who Pays as Power Demand Grows

As North Carolina faces growing electricity demand from data centers, artificial intelligence, and new industries, a new report adds to an ongoing debate over who should bear the cost of expanding the state's electric grid.

The report from the John Locke Foundation, "Energy Poverty in North Carolina: Securing Affordable, Reliable Power," argues that state energy policies have played a larger role in rising electricity costs than the growth of data centers. It recommends several legislative changes, including allowing large electricity users to procure their own power and revisiting portions of North Carolina's current energy laws.

It shows that Rutherford County ratepayers rank third on a 1-4 scale on the energy poverty index, compared to all counties in the state.

The discussion comes against the backdrop of policies adopted under former Gov. Roy Cooper, whose administration supported the state's transition to lower-carbon electricity generation and economic development incentives that attracted major technology investments, including data centers.

Current Gov. Josh Stein has continued supporting economic development while calling for protections to ensure data centers and other large electricity users pay the costs associated with the infrastructure needed to serve them. Stein has urged the use of separate electric rates, or tariffs, for those customers.

Under North Carolina law, the North Carolina Utilities Commission regulates investor-owned utilities, reviews requests for new power plants and transmission projects, and determines whether related costs may be recovered through customer rates. The commission is also responsible for implementing the state's Carbon Plan, which requires reductions in power-sector carbon emissions while maintaining reliable electric service at the least reasonable cost.

The issue is expected to remain before state lawmakers and regulators as North Carolina plans for continued population growth, new manufacturing projects and increasing electricity demand.