A: It's a big disappointment for us, certainly, but the case is now returning to the lower courts where we're going to continue to defend our position. I believe we have solid defenses against the government's claims and will prove in the lower courts that the projects we were undertaking were not subject to the NSR provision. That provision applies to what they call "major modifications" of plant facilities, not the kind of more routine upgrades that we were undertaking.
Q: But if Duke is claiming to be a good corporate citizen, shouldn't you support regulations that require the use of top-notch technology to control emissions?
A: Well, the problem is that NSR often keeps us from using advanced technologies to make our plants more efficient, because every time we want to modify a plant and improve it, we have to go back and upgrade it in every way. And that might not make economic sense, so it often acts as a deterrent to make technological improvements.
Q: What is Duke doing in terms of its own operations to help solve the climate crisis?
A: I've always viewed energy efficiency as the fifth fuel. We think that the most environmentally benign plant you can build is the one you don't build. Job one is getting our customers to implement a broad array of efficiency measures, and give them more control over their bills, which will dampen the growth in demand. Job two is trying to use our distribution system more efficiently. We lose a lot of energy just in the transmission cables, so we're working to reduce what we call "line loss." Third, we're trying to increase how much we use our nuclear units. Fourth, we've contracted up to 100 megawatts of wind [power] in Indiana, and are exploring investment in other renewable energy areas such as biomass.
Q: The Edison Electric Institute has long opposed carbon caps, and under your leadership it has relented. How did you push through that change?
A: I was lucky to be there when the change occurred in people's thinking. The pivotal moment was back on Jan. 10. We had a board meeting in Arizona, and as chairman I asked every person in the room -- there were 50 different CEOs -- to give their view of how as an industry we ought to move forward on climate change. It was like a snowball effect. Everybody stepped up and talked and it became increasingly clear that we needed to change our position from just supporting voluntary efforts to supporting regulation.
Q: In the long run, do you think society will have to consume and produce less energy?
A: One of my favorite statistics is that in the U.S., electricity demand as a percentage of GDP has actually decreased 30 percent. To say it another way, if we were at the same concentration of electricity per unit of GDP today, we would have to build as many power plants as there are in Texas and California. So we've become as an economy less energy intensive, and I think that trend will continue.
Q: Did you have a "conversion moment" on the climate issue?
A: There wasn't a burning bush on the way to Damascus that did it for me. But about eight years ago I asked this smart guy in our company, a former Peace Corps member, to be my special assistant, because I liked the way he thought. I asked him to tell me about carbon. He did all this research, we spent long stretches of time talking about it. At the same time, I was attending the World Economic Forum at Davos every year. I'd sit and listen to how the Europeans are thinking about it. I started to say, "Wow, they have such a different view than we have." So that forced me to dig in more. The more I learn, the more passionate I get about it.
Q: How are you personally reducing your carbon footprint?
A: I'm actually in the process of building a house, and I'm working with my architect to bring in people who are experts on building energy-efficient homes. So I'm trying to build a home that reflects energy efficiency's best practices. This is a passion of mine. I've recently been named to the Alliance to Save Energy board, and my goal is to be chairman of that in several years.
Q: What kind of car do you drive?
A: I drive a Lexus. A real small one, though.
Amanda Griscom Little writes Grist's Muckraker column on environmental politics and policy and interviews green luminaries for the magazine. Her articles on energy and the environment have also appeared in publications ranging from Rolling Stone to The New York Times Magazine.
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