As the North Carolina legislature tries to wrap up its summer session, subsidies for renewable energy are on the chopping block. The state’s hog farming industry could be affected if the subsidies are removed.
Right now, North Carolina state law says utilities have to produce at least 6% of their energy from renewable sources. The law also requires that percentage to climb to a peak of 12.5% by 2021. In order to meet these standards, the state subsidizes the effort.
Don Butler is the Vice President of Public Affairs for the Hog Production Division of Smithfield Foods – the world’s largest pork producer. Butler says the renewable energy subsidies support research for capturing methane gas from hog waste:
Butler: Currently, the cost of producing electricity from a digester fueled by swine manure is higher than – it’s more expensive to produce it that way than Duke Energy and others pay for coal-fired or nuclear-powered plants. If it’s not subsidized in some way, it’s not economically feasible for us.
According to Butler, this form of energy production could become viable soon. But if the subsidy is in question, so are potential investors.
Yet some legislators want to pump the brakes on the renewable energy subsidies. State Representative Chris Millis, a Republican from Pender County, proposes freezing the renewable energy requirements at the current level of 6%, giving legislators the chance to evaluate the requirement – and potentially – lower it. Addressing swine waste-to-energy, Millis says the requirement for such production is waived every year:
Millis: Since 2007 when this bill was enacted, those set asides have been waived every single year by the Utilities Commission because the technology and cost are not there. So, I mean, government may have these great intentions, but it doesn’t mean that it actually meshes with reality.
The freeze on the renewable energy portfolio standard has passed the House and awaits approval from the Senate.