North Carolina Utility Cites Costs Deferring Offshore Wind Power for Solar

Duke Energy, which is one of the United States’ largest energy companies, has determined that offshore wind energy does not offer a cost advantage over solar power for North Carolina. The determination came as the utility was planning its long-term power sources and is based on proposals from the current leaseholders for offshore wind in North Carolina.

Headquartered in North Carolina, the company operates utilities in the Southeast as well as the Midwest. Its North Carolina utility was directed by the state's Utilities Commission last fall to explore offshore wind energy. As part of this review, it was instructed to request estimates from the three leaseholders for the development of up to 2.4 GW of offshore wind energy.

Duke, through its non-regulated subsidiary Cinergy, holds one of the leases that it was awarded in 2022. The project known as Carolina Long Bay is 22 miles south of Bald Head Island and could support up to approximately 1.6 GW. Neighboring Carolina Long Bay is TotalEnergies, which has the potential for 1.6 GW, and the two companies have explored collaborations.

A third offshore site available to Duke is Avangrid’s Kitty Hawk South, which was awarded in 2017. The company originally said it could produce up to 2.4 GW, but in 2022 sold the northern portion of its lease to Dominion Energy. 

The three developers submitted a total of eight proposals, Duke reports in a filing to the Utilities Commission. It was looking for the projects to be developed by 2035. 

In the filing submitted on August 11, Duke informed the commission that, based on its review, it determined solar and battery storage was cheaper in every instance. The company reports it was comparing the cost of building 3,576 MW of solar panels and 3,440 MW of battery storage capacity.

A spokesperson for the company told North Carolina Public Radio that they determined “offshore wind is not cost-competitive at this time.” The commission had instructed Duke that if the proposals were cost-competitive, to proceed with a binding request for proposals.

Supporters of wind energy were quick to criticize the review, noting that solar only provides power 30 to 40 percent of the time, whereas wind energy can generate between 80 and 90 percent of the time. They said they were “disappointed” that Duke was not proceeding, highlighting that it would require at least a decade before construction and commercial operations could be realized. 

“The cost of wind being compared to solar and storage is one thing, but the efficiency of offshore wind being compared to solar and storage is a completely different thing because there are just fundamentally so many key differences between the technologies," Karly Brownfield, a senior program manager with the Southeastern Wind Coalition, told the public radio station WUNC.

Duke Energy is aggressively pursuing solar energy in Florida. The company reported last month that it currently owns, operates, and maintains a portfolio of more than 25 solar sites across Florida that generate approximately 1.5 GW, and between 2025 and 2027, the company plans to build 12 new solar sites, adding 900 megawatts. By the end of 2033, Duke Energy Florida projects it will have over 6.1 GW of utility-scale solar generating capacity online.

The company is reviewing its North Carolina plans. In a 2024 plan, it showed up to 1.6 GW of offshore wind energy by 2035. Another model included as much as 2.4 GW of offshore wind energy.

The planning study was undertaken before the Trump administration’s latest moves against the offshore wind energy sector. In addition to its ending leasing, the administration is now starting a national security review. It has also curtailed tax credits and other incentives for offshore wind energy development.