North Carolina Must Change Course on Carbon Plan, Data Centers, other Climate and Energy Justice Issues

In 2025, North Carolina saw an effective repeal of its carbon plan, and the state is now on track to approve over 100 data center projects. This will further imperil the state’s 2050 decarbonization goal while creating a new slew of environmental and public health concerns and electricity affordability problems. The state is charting a harmful path and should change course before its policies hurt more people and communities.

Without adequate upstream protections, structures to build and strengthen community power, and a rejection of the “inevitability” message that hyperscale data centers must exist, the people of North Carolina could become even more deeply beleaguered with the cumulative externalities from these centers like its neighbors Virginia and Georgia. These include eroding carbon emissions reduction targets and increasing air pollution in communities already overburdened by environmental harms.

Duke Energy has already used its lobbying power in the General Assembly to pass Senate Bill 266, which removed the 2030 interim target reduction goals while keeping the goals for 2050. There’s no reason to believe that the utility will follow through on even that commitment given how much they have already “kicked the can down the road.”

Under its current Carbon Plan and Integrated Resources Plan (CPIRP), which was updated to include an increase in load growth from data centers, we will surely see an increase in carbon emissions. Specifically, one of the primary arguments Duke has made against decarbonizing at the pace outlined in state law is “grid reliability” due to increased load growth, explicitly from data centers.

Duke Energy representatives emphasized that to cover the projected 80 percent increase in demand from data centers, they must upgrade existing resources to increase reliability at the same time they add new resources to generate more energy. These new resources are largely methane gas plants; those being “upgraded” and kept online through the 2040s are heavily polluting coal peaker plants. That means the utility is adding more fossil-based energy resources instead of investing in more solar, storage, and wind energy in order to cut carbon emissions. In fact, Duke Energy decreased the amount of solar and wind resources in the latest CPIRP (by cutting solar by almost 25 percent and not including any offshore wind capacity).

Duke’s plans to expand methane gas capacity into the 2040s — when they intend to transition to hydrogen — puts the utility at risk of not complying with the 2050 net-zero carbon emissions law. This puts ratepayers at risk of footing the bill for expensive generation assets instead of employing a true least-cost approach to meet demand. This is particularly the case under a provision in Senate Bill 266 called “construction work in progress,” which allows the utility to charge customers for infrastructure even if it never comes online. Researchers estimate that investing in these fossil-based resources, lagging on the decarbonization target timeline, and eschewing lower-cost solar, storage, and wind resources could ultimately cost ratepayers up to $23 billion by 2050.

Already, families and communities across North Carolina are struggling to keep the lights on, and asking them to further subsidize the energy use of billionaire tech companies will increase the harm from out-of-control energy cost increases. From 2017 to 2024, the average residential electricity bill rose nearly 30 percent, and power bills rose by 22 percent between 2020 and 2025. Almost two-thirds of the increases are due to rising fuel costs, mostly driven by rising and volatile methane gas prices, which will only worsen with inflation, war, and climate change disrupting supply chains. Now, with 80 percent of the projected increase in demand from data centers on top of an 18 percent rate hike request from the utility, bills will become even more impossible to pay.

In the 2025 legislative session, House Bill 638 and House Bill 1002 were introduced to address AI data centers, but ultimately neither were taken up by committee for consideration. HB 1002, “Rate Payer Protection Act,” sponsored by Rep. Pricey Harrison, would have prohibited utilities from charging residential ratepayers for the electricity costs of large commercial data centers and required these costs to be paid directly by the data center company through separate rates; the bill would have also created a Special Commission for Data Center Planning — similar to ones in Maryland and Virginia — to study infrastructure and grid capacity, develop forecasting models, and make policy recommendations. It’s uncertain if ratepayer protections in North Carolina will garner the political will needed for passage, but states like Georgia have shown that consumer protections can be bipartisan.

Even if tech companies foot the bill down the line for capital buildouts of fossil gas infrastructure, we are already stuck with more methane gas infrastructure that the utility has claimed its needs for load growth. Ratepayers already are, and will continue to be, on the hook to shoulder costs for expensive gas plants already coming to our state because of SB 266, and these plants are linked with load growth associated with data centers.

With bare minimum ratepayer protections, many communities still don’t want to absorb other externalities from data centers. Without generalizing, communities from all over the state don’t want data centers at all. Even if tech companies pay their way, and even if their bills won’t be impacted, there are a variety of other concerns — water and noise pollution, stranded assets, loss of tax revenue, lack of long-term employment, and more. From western North Carolina (for example, Swain County held a public hearing on March 31 on a potential moratorium on data centers) to eastern and central parts of the state, communities are opposing data centers, calling for moratoria at minimum, and some even want bans on hyperscale data centers in their communities.

There are currently over 90 data centers across the state, and that number could continue growing with the “economic development” friendly vibe of the governor and legislature incentivizing this growth. On the other hand, at least five local North Carolina governments (Chatham, Canton, Brevard, Gates, and Boone counties) have passed moratoria on data centers as of April 2026, and Apex, Lee County, and Swain County are considering the same.

The state should listen to communities rallying against the many externalities of data centers. We don’t need even more environmental and public health burden for the sake of techno-billionaire investments.