North Carolina Economic Development Guide

2014

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hydroelectric capacity, leading to coal plants now criticized for their emissions. In the last two decades Duke Energy has begun cleaning or closing them, but, simultaneously, offshoring and other economic trends have caused scores of old, energy-hungry textile and furniture plants to vanish, too. The result: large amounts of electrical capacity available at reasonable rates. Decker says the state's per-kilowatt prices are the nation's 23rd-lowest and about 15% below the national average. Data centers, considered environmentally friendly, use as much or more energy as the old-line manufacturers they're replacing, industries often characterized by smokestacks that spew pollutants. Not only do data-center servers require massive amounts of power to store and process data, they generate heat that must be dissipated. One of the newest and adjusted them to reduce losses as well as to use natural cooling as much as possible." Still, generating energy from inexhaustible resources is the top priority of companies riding the renewable-energy wave. Duke Energy cites its progress in supplying it. "We've done significant work retiring old coal plants and retrofitting existing ones with clean technology," says Caldwell, the Duke executive. "We've got probably 300 megawatts of renewable generation under contract," about 3% of total output. That's expected to jump to 6% in 2015, and deals such as the Duke Energy-Google collaboration could push that number higher. The concept — some call it the green tariff — is simple. The new rate and the pricing mechanisms will allow a company that values renewable energy, whether for operations or public re- "You build a wind farm, and once it's built, you're not having to pay for the wind. You build a solar farm, and you're not paying for the sun." data centers is near Google's in Lenoir — in a 28,000-square-foot former textile mill. Dacentec Inc.'s cloud-computing center, which employs several dozen workers and is expanding, was acquired in June by Rochester, N.Y.-based CentriLogic Inc. There, the computing power of a data center leaps into focus. This one can store 300 petabytes of information. A petabyte is 1,024 terabytes, and a terabyte equals about a million gigabytes. Everything in the Library of Congress would fit on 10 terabytes. "We try to run the data center as green as possible," says Matej Sustic, vice president of operations and technology for CentriLogic. That started with gutting the former textile factory. "To achieve better energy efficiency, the engineers redesigned some of the standard systems you'd find in every data center 46 lations, to obtain it from Duke Energy. Enacting the new rate, which is awaiting review by the Utilities Commission, is more complicated. All electricity looks the same to the massive and redundant Duke Energy electrical grid. For Apple, making its own energy on-site in Maiden is no problem. But for others, the question becomes, how can a company ensure the power it's getting is renewable? The answer is what Google's Terrell calls "additionality." "One thing we're looking at is to see if we're actually leading to new sources of power generation rather than just using something that's already there." That involves sorting. I n a former soybean field near Murfreesboro in northeastern North Carolina, sun sparkles off hundreds of panels in a 5-megawatt solar array that's a joint project of Duke Energy Renewables and Raleigh- NO RT H C AROL I NA E CO NOMI C DE V ELOP M E N T GU IDE based GreenCo Solutions Inc., owned by the state's electric cooperatives. Similarly, a 5-megawatt project by Chapel Hill-based Strata Solar Inc. recently went online in Orange County, selling its output to Duke Energy. Though both projects underscore the growth of solar energy in the state, neither would satisfy Google's contract for a yet-unspecified volume of renewable power. "The rate is being designed to require the customer to sign a contract with Duke Energy Carolinas to a certain amount of renewable energy or renewable-energy credits each year for a number of years," Duke Energy spokesman Jeff Brooks says. "Duke will build that capacity or acquire it through renewable-energy certificates equivalent to the amount contracted for. The intent is to encourage development of new projects. They'll know exactly where their renewable energy is coming from." Existing projects — or those Duke Energy builds to satisfy a state requirement that utilities generate 12.5% of their power mix from renewable sources by 2021 — won't count. Comparing prices between conventional and renewable sources is difficult, researchers say. Sunlight, geothermal and other such sources of energy are free, but harvesting and delivering that energy with technology such as photovoltaic panels is expensive. A recent Georgia Tech University study found the cost of power from renewable sources might be at least 50% higher than that from fossil fuels. In North Carolina, the current industrial rate for electricity is about 4.5 cents per kilowatt-hour. However, factor in what analysts call "externalities," such as the health-care costs from air pollution from fossil fuels, and the gap between renewable and fossil narrows. Also, advances in technology, including those made at N.C. State University's North Carolina Solar Center in Raleigh, are leveling the playing field. "Renewable energy is coming closer and closer to parity, making it a good bet from a

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