Jim Rogers, the CEO of Duke Energy, was a star speaker on the opening panel of The Economist‘s Carbon Economy conference, which concluded yesterday in Washington. A long-time supporter of greenhouse gas regulation, Rogers called for an “honest conversation” about how to transition to a “low-world.” Yet when asked about the role utilities should play in this necessary process, Rogers’ answers only raised further questions.
The lone energy executive on a panel packed with pundits and regulators, Rogers generally relied on tried and true talking points he has trotted out elsewhere. Trouble arose when he went out on a limb and asserted that it would be “politically impossible” to price carbon emissions “high enough to engender investment in solar and wind.” Rick Duke, the US Department of Energy’s representative, said in regards to wind power Rogers was “selling the market short.” Duke pointed out that “mature renewables are in the zone” of price parity with coal energy if emissions are priced at even a modest rate.
The moderator, Economist deputy editor Emma Duncan, asked if Rogers was plying up the political challenges of a high carbon price because the he prefers the economically inefficient alternative: government subsidies for utilities. Rogers defended Duke Energy’s handouts, which he said benefit consumers and “smooth out the transition” to higher price, low-carbon economy. Left unanswered was why Rogers thinks filtering through energy companies subsidies intended to benefit consumers is more efficient than directly distributing rebates to the households in coal-dependent states who will see their energy prices rise most as the US works to wean itself off dirty energy.
Rogers then turned the focus of the discussion to the need for more effective research and development spending “focused on results and value.” When Duncan pointed out the awkward fact that utilities spend less on R&D than the pet food industry, Rogers defended his industry’s lack of investment by claiming, “that’s not a part of our mission.” Really? Duke Energy’s website describes its “mission” as making
people’s lives better by providing gas and electric services in a sustainable way. This requires us to constantly look for ways to improve, to grow and to reduce our impact on the environment.
Would Rogers have the public believe these “improvements” can be made with sclerotic rates of R&D spending?
With his outsized influence in the climate debate, what does Rogers seek to gain from what he realizes will be the inevitable regulation of greenhouse gases? As a Point Carbon study pointed out earlier this year, Duke Energy stands to be one of the biggest losers if the current climate bill passes. While the leadership position Rogers has taken on climate change regulation is welcome, it is still worthy of some deserved skepticism.