Duke Energy CEO balancing demand against global warming

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CHARLOTTE, N.C. (AP) — Jim Rogers wants to do something about global warming. But the chief executive of Duke Energy Corp. also has a growing customer base that needs power now, and he says that means building more coal-fired plants.

It’s a dilemma faced by many in a position to significantly reduce carbon dioxide emissions, and one highlighted by President Bush’s visit to North Carolina on Thursday to tout cellulosic ethanol — a fuel that has the potential to reduce gasoline consumption but remains years away from widespread use.

“My job is, when you throw on the switch, I need to be there,” Rogers told The Associated Press. “My No. 1 job is to make sure there is a reliable supply of energy for our customers.

“While I’ve devised a plan to assure reliability, I also have to do the right thing for the environment.”

The United States is by far the biggest emitter of carbon dioxide and other gases blamed by scientists for global warming, and for years, Rogers has been one of the few utility executives to speak out publicly about the need to reduce carbon emissions.

Last month, he joined chief executives of nine other major U.S. corporations — including BP America Inc. and General Electric Co. — to push Bush and Congress to address climate change. The group, known as the United States Climate Action Partnership, wants a nationwide limit on carbon dioxide emissions that would lead to reductions of 10 percent to 30 percent over the next 15 years.

Their announcement came a day before Bush — who for years said there wasn’t enough known about global warming to act, and that efforts to cut back greenhouse gases emissions would harm the U.S. economy — proposed reducing gasoline consumption by 20 percent in 10 years during his State of the Union address.

Bush’s administration has also set a goal of reducing “greenhouse gas intensity,” which measures the ratio of greenhouse gas emissions to economic output, by 18 percent by 2012.

“That’s good, but more can and should be done,” Rogers said.

The problem, Rogers and others said, is that the technology and infrastructure for alternative energy doesn’t yet exist to substantially satisfy the energy demands of a country dependent on cars, computers and all kinds of modern electrical conveniences.

“There is no way we can supply the electricity that keeps our lifestyle going in the United States with alternative energy sources right now,” said CreditSights bond analyst Dot Matthews. “The technology and resources aren’t enough.”

Cellulosic ethanol, which Bush will promote Thursday, is made from waste, wood, plants and other biological products. While experts said the entire process from harvest to production to actually burning cellulosic ethanol instead of gasoline would lead to a 70 to 90 percent reduction in greenhouse gas emissions, it remains experimental and commercial-size refineries are several years away.

“The next couple of years will be a test,” said Steve Bantz, a senior engineer with the clean vehicles program at the Union for Concerned Scientists. “We will then see if they can really make this happen and make it economical.”

At Duke, the new nuclear power plants the company has suggested building — hardly a favorite of the same environmental and consumer groups upset with Duke’s desire to expand its coal-burning capacity — are about a decade away from coming online.

In the meantime, Rogers has 3.9 million customers spread across several states. In North Carolina alone, Duke expects a 50 percent increase in demand from 2000 to 2030 due to new homes, new businesses and what Rogers called a “love affair with anything electronic.”

To meet that demand, Duke — the nation’s third-largest consumer of coal — wants to spend $3 billion to build two coal-fired units at its existing Cliffside Steam Station in western North Carolina. Opponents worry about the plant’s effect on air quality and say Duke hasn’t taken enough steps to generate more capacity through conservation.

“I think it’s a contradiction,” said state Rep. Paul Luebke, a Democrat from Durham. “It’s a contradiction for Mr. Rogers to be in the international press talking about Duke’s commitment to fighting global warming while at the level of North Carolina the company seems to be committed to moving full steam ahead (on the Cliffside project).”

Rogers said Duke is working to avoid the adverse impact of its disproportionate reliance on coal, but the new plants are necessary to meet a booming market with a growing need for power — a need he said he can’t yet serve solely with clean technology.

In the interim, he supports a so-called cap-and-trade system, which he said would create a financial incentive for reducing emissions by assigning a cost to polluting. It is one of a few ideas floating around on Capitol Hill, a place Rogers has been recently visiting — sometimes weekly — to talk with lawmakers about the issue.

“I’ve gotten past the problem,” Rogers said. “I’m focusing on the solutions.”

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On the Net:

Duke Energy Corp.: http://www.duke-energy.com

United States Climate Action Partnership: http://www.us-cap.org