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State legislators pushing to unravel North Carolina’s climate law say their bill will give utility Duke Energy more leeway to build new gas and nuclear power plants and save its Tar Heel customers billions of dollars.
But Gov. Josh Stein disagrees: He vetoed Senate Bill 266 on Wednesday, prompted by data showing that the legislation would cost households and slow the state’s energy buildout. The GOP-sponsored measure would repeal a requirement that Duke slash carbon pollution 70% by 2030 compared to 2005 levels, while leaving a 2050 carbon-neutrality deadline intact.
“This summer’s record heat and soaring utility bills has shown that we need to focus on lowering electricity costs for working families — not raising them,” Stein, a Democrat, said in a statement. “My job is to do everything in my power to lower costs and grow the economy. This bill fails that test.”
In issuing his veto, Stein pointed to a new study from researchers at North Carolina State University, which builds on projections from the state customer advocate, Public Staff. That modeling showed SB 266 could cause Duke to build less generation capacity over the next decade, just as electricity needs are expected to surge.
That means Duke would have to lean harder on aging plants and burn almost 40% more natural gas between 2030 and 2050, experts at N.C. State University say. Under a worst-case but plausible scenario for gas prices, customers could pay $23 billion more on their electric bills by midcentury as a result.
“As our state continues to grow, we need to diversify our energy portfolio so that we are not overly reliant on natural gas and its volatile fuel markets,” Stein said.
A complex measure that’s faced little public debate, SB 266 easily cleared both chambers of the Republican-controlled General Assembly in June with a handful of Democratic votes. With Stein’s action, advocates now turn their focus back to state lawmakers, who are on break for at least another week. The GOP has the three-fifths majority needed to override the veto in the Senate, but is one member shy of that margin in the House.
“Governor Stein is championing working families all across North Carolina who would be harmed by this new law,” said Will Scott, Southeast climate and clean energy director for the Environmental Defense Fund. “Legislators should reconsider the harmful consequences of this law for the working families in their districts.”
The N.C. State study underscores a surprising finding from Public Staff’s modeling: SB 266 does little to prepare North Carolina for ballooning electricity needs expected from an influx of data centers, manufacturers, and new residents. In fact, removing the 2030 goal would prompt Duke to build 11,700 fewer megawatts of new power plants in the next decade than its current plans.
“In talking with legislators, I found that almost all of them emphasized economic growth and the need for power generation to meet that demand,” said Scott. “But Public Staff’s analysis found that the most likely short-term impact of SB 266 is to build less new generation and storage and instead to lean harder on aging coal and gas facilities.”
The Public Staff forecast shows renewable energy would be the main short-term casualty of SB 266, just as its backers intend. By 2035, Duke would construct 7,200 fewer megawatts of solar and battery storage, and no offshore or onshore wind farms whatsoever — a 4,500-megawatt decrease compared with the status quo.
But new “always-on” nuclear and gas resources — the same ones SB 266 champions seek to promote — would also suffer. Without a near-term carbon reduction deadline, Public Staff says Duke would develop just 300 megawatts of nuclear power in the next decade, half as much as it currently plans. The utility would build 1,400 fewer megawatts of large, efficient combined-cycle gas units.
Only gas “peaker plants” — simple-cycle combustion turbines that are relatively cheap to build but expensive to operate — would become more abundant, Public Staff forecasts. Duke would build 3,800 megawatts’ worth instead of 2,100.
The model’s underlying assumptions haven’t been made public. But experts say the reason for this short-term impact is likely that without a carbon constraint, it’s simply cheaper to run existing coal and gas plants more often than it is to build new ones.
The same Public Staff study predicts that removing the 2030 target would yield $13 billion in present value in customer savings by 2050 — a figure much vaunted by SB 266 supporters.
But detractors have long pointed out that the discount comes from avoided construction costs only and doesn’t account for the price of fuel, 100% of which is passed to utility customers through a “rider” on monthly bills.
As it happens, the $23 billion in added fuel costs estimated by N.C. State translates to $13 billion in present value.
“That is a pure coincidence,” said Jeremiah Johnson, one of the researchers. “It completely negates the claimed savings.”
Duke might also have to buy more power from utilities in neighboring states to meet electricity needs, another blow to residential consumers, who under SB 266 would pay a higher fraction of those costs than they do today.
“This bill not only makes everyone’s utility bills more expensive,” Stein said, “but it also shifts the cost of electricity from large industrial users onto the backs of regular people — families will pay more so that industry pays less.”
Advocates also point to the simple public health rationale for keeping the state’s 2030 pollution-reduction goal intact. Relying on existing coal and gas plants instead of building more solar means millions of tons more climate pollution released into the atmosphere every year, plus pollutants that lead to smog and soot.
Then, there’s the commonsense argument, said Matt Abele, executive director of the North Carolina Sustainable Energy Association: “You don’t establish a 30-year goal without milestones along the way.” Achieving emissions reductions is like saving enough money for retirement — it takes planning and can’t be done in just a couple of years. “These things do not happen overnight,” he said.
Abele’s group analyzed the 24 states, plus D.C. and Puerto Rico, with zero-carbon targets around the middle of the century. Just one, Nebraska, lacks any sort of interim goal.
The reason, according to state Rep. Maria Cervania, a Democrat from Wake County who voted against SB 266? “Deadlines matter.”
At a news conference last week, she said that the 2030 goal has given “us a clear, science-based target to hold the utilities accountable. … Without it, progress slows and polluters face no urgency to act.”
An update was made on July 2, 2025: This story has been updated to reflect that Gov. Stein vetoed SB 266 after this story was published.
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