State-level Renewable Portfolio Standards Research Articles

Renewable Portfolio Standards

State-level renewable portfolio standards (RPSs) aim to encourage renewable energy and discourage greenhouse gas (GHG) emissions from the electric power sector in the United States. Do they work? Some prominent government agencies and advocacy groups assert that U.S. renewables growth has been largely due to RPSs. That seems unlikely, given that in most regions, renewables exceed RPS requirements. But it is not an easy question to answer, thanks to interstate trading and the possibility that states with abundant renewable resources might set the most ambitious RPS goals. We combine the best features of four recent academic studies, using ordinary least-squares and instrumental variables approaches. In some specifications, RPSs do appear to reduce the use of natural gas to generate electricity and decrease GHG emissions, while boosting the use of wind and solar power. But the effects are small—consistent with the academic findings and in contrast to the public claims and policy goals.

Punctuated shifts or incremental change? A comparative analysis of U.S. state-level renewable energy mandates

In the U.S., regulatory policies designed to reduce carbon dioxide emissions from the electric power sector have primarily occurred through the adoption of state-level renewable portfolio standards (RPS). In recent years several states have amended existing renewable energy mandates to establish targets that require 100 % of electricity to be generated from zero-emissions energy sources while, in others, renewable energy objectives have remained stagnant. This study applies Punctuated Equilibrium Theory (PET) to assess whether recent modifications to state-level renewable energy objectives are indicative of punctuated shifts or incremental change. Examination of the dynamics of RPS policy change occurs through a distribution analysis of amendments to renewable energy objectives. The PET framework is then applied to two case studies to examine the factors that contribute to policy stasis and punctuated change to renewable energy targets. The quantitative analysis demonstrates that state-level renewable energy amendments reflect the characteristics of policy change described by PET. The qualitative analysis validates the applicability of the PET framework to understand and explain the dynamics of policy change within this policy subsystem.

Waste incinerators undermine clean energy goals

A national clean energy standard, modeled upon existing state-level Renewable Portfolio Standards, has been proposed to decarbonize the U.S. electric grid. Most such state policies include municipal solid waste incineration as a form of “renewable” energy, despite incinerators’ prominent contributions to air pollution, primarily in environmental justice communities. This study finds that incinerators emit more greenhouse gas emissions per unit of electricity produced (1707 g CO2e/kWh) than any other power source (range: 2.4 to 991.1 g CO2e/kWh). They also emit more criteria air pollutants than replacement sources of energy, such as natural gas. Incineration’s inclusion in “renewable” or “clean” energy standards is thus counterproductive, as they also divert more than $40 million in subsidies annually from cleaner energy sources. As the electric grid decarbonizes, these disparities will only grow. With most U.S. incinerators nearing their end of life, policy choices about their eligibility for subsidies may well decide whether they shut down or undertake expensive capital improvements to continue operating. Extending incinerators’ operational lives by 20 years would result in excess emissions of up to 637.7 million tonnes CO2e, 61.9 million tonnes NOx, and 161,200 tonnes SO2. Conversely, a rapid shutdown of existing incinerators would help decarbonize the electric grid and reduce criteria air pollution, particularly in environmental justice communities, which are disproportionately burdened by environmental health hazards.

The U.S. Manufacturing Sector's Response to Higher Electricity Prices: Evidence from State-Level Renewable Portfolio Standards

The U.S. Manufacturing Sector's Response to Higher Electricity Prices: Evidence from State-Level Renewable Portfolio Standards

Effects of state and federal policy on renewable electricity generation capacity in the United States

Multiple studies have examined the impact of state-level renewable portfolio standards (RPS) on renewable electricity generating capacity. Two of the most widely cited of these papers (Yin and Powers, 2010; Shrimali et al., 2015) both conclude that as an RPS mandates higher shares of renewable generating capacity within a state, utilities respond by increasing the renewable electricity generating capacity. When we update the data for those models, we find that conclusion is not robust. We also modify those models and extend the datasets out to 2018, and in every model-permutation fail to corroborate the original conclusions. Finally, we examine the impact of the 2009 American Reinvestment and Recovery Act, and find it has had a significant, positive impact on renewable electricity generating capacity. We conclude that state-level RPS are not a sufficient substitute for federal action to reduce greenhouse gas emissions from the electricity sector. Federal leadership matters. This paper also demonstrates the importance of investigating the robustness of previous results to data refinements.

The Value of Inter-Regional Coordination and Transmission in Decarbonizing the US Electricity System

Summary Preventing global warming in excess of 1.5°C–2°C requires a transition to zero-carbon electricity systems by midcentury along with the widespread electrification of other sectors. Current state-level renewable portfolio standards and regional transmission arrangements do not capture the benefits of inter-regional transmission or coordination of planning and dispatch for renewable-energy integration. Here, using a co-optimized capacity-planning and dispatch model over 7 years of hourly operation, we show that inter-state coordination and transmission expansion reduce the system cost of electricity in a 100%-renewable US power system by 46% compared with a state-by-state approach, from 135 $/MWh to 73 $/MWh. Sensitivity analyses show that reductions in the cost of photovoltaics, wind, and lithium-ion batteries lead to the lowest electricity costs for systems in which transmission expansion is allowed, while cost reductions for nuclear power or long-duration energy storage lead to greater electricity cost reductions for isolated systems.

Predictive-Maintenance Practices: For Operational Safety of Battery Energy Storage Systems

Changes in the Demand Profile and a growing role for renewable and distributed generation are leading to rapid evolution in the electric grid. These changes are beginning to considerably strain the transmission and distribution infrastructure. Utilities are increasingly recognizing that the integration of energy storage in the grid infrastructure will help manage intermittency and improve grid reliability. This recognition, coupled with the proliferation of state-level renewable portfolio standards and rapidly declining lithium-ion (Li-ion) battery costs, has led to a surge in the deployment of battery energy storage systems (BESSs). Although BESSs represented less than 1% of grid-scale energy storage in the United States in 2019, they are the preferred technology to meet growing demand because they are modular, scalable, and easy to deploy across diverse use cases and geographic locations.

Market Sensitivity of Solar-Fossil Hybrid Electricity Generation to Price, Efficiency, Policy, and Fuel Projections.

Ideally, new electricity generating units will have low capital costs, low fuel costs, minimal environmental impacts, and satisfy demand without concerns of intermittency. When expanding generating capacity, candidate technologies can be evaluated against criteria such as these. Alternatively, it may be possible to pair technologies in such a way that the combination addresses these criteria better than either technology individually. One such approach is to pair concentrated solar power and natural gas combined-cycle units. This paper analyzes how an integrated solar combined cycle (ISCC) facility could fare in the larger US electricity production market, although the results are generalizable to a wider range of technologies. Modeling results suggest that a critical consideration is the extent to which ISCC qualifies as being renewable under state-level renewable portfolio standards (RPSs). The technology would be utilized at a higher level if it fully satisfies an RPS; however, even if the technology does not satisfy an RPS, it would be market-competitive if optimistic goals for capital cost and avoided natural gas purchases are met. Furthermore, if used in parts of the country with strong solar resources, ISCC could produce as much as 14% of national electricity generation in 2050. Whether adoption of ISCC leads to reduced air pollutant and greenhouse gas emissions is dependent on the technologies it displaces. Under default assumptions, the new ISCC capacity primarily displaces renewable and natural gas facilities as opposed to facilities with higher air pollutant emissions. Thus, the air pollution benefits of ISCC may be limited.

The spatial distribution of welfare costs of Renewable Portfolio Standards in the United States electricity sector

In the US, renewable energy policy has largely followed a regional approach; 29 states are currently implementing Renewable Portfolio Standards (RPSs) at varying levels of stringency, while the other states have no renewable energy policy. Requiring individual states to achieve given targets is likely to be less efficient and lead to different levels of greenhouse gas (GHG) abatement than a national RPS that achieves the same national share of renewable electricity generation since the latter allows more flexibility in the regional shares based on their relative costs of renewable electricity generation. RPSs are also likely to be less efficient than a national GHG cap and trade (GHG Cap) policy which allow flexibility in achieving GHG abatement through a variety of approaches. We examine the welfare costs and GHG abatement achieved by the existing state RPSs relative to a hypothetical national RPS and a national GHG Cap policy. We undertake this analysis using a dynamic, multi-region, partial-equilibrium, price-endogenous model of the US electricity, agricultural, and transportation sectors, called the Biofuel and Environmental Policy Analysis Model (BEPAM-E). Our results show that a hypothetical national RPS and can induce an equivalent share of renewable-based electricity generation as the state RPSs but at a $61 billion lower welfare cost over the 2007–2030 period. The national RPS would also achieve greater GHG reductions than the state-level RPSs, as it induces a larger decrease in coal generation. We find that the national RPS and national GHG Cap are 55 and 74% more cost-effective in reducing GHG emissions than the state RPSs.

The Disparate Influence of State Renewable Portfolio Standards on Renewable Electricity Generation Capacity

Several papers have used panel data analyses to examine the effectiveness of U.S. state-level renewable portfolio standards (RPS) in promoting renewable capacity development, but the findings are inconclusive. Estimation of average treatment effects, however, can mask the fact that RPS policies across states are disparate and the treatment states are heterogeneous. We use the synthetic control method to conduct individual case studies of the early adopter states. Our findings indicate that the impact of RPS policies varied across states. We find Texas to be unique among these early adopters in that the RPS policy in Texas has led to increased renewable capacity. (JEL Q42, Q48)

The environmental and cost implications of solar energy preferences in Renewable Portfolio Standards

Many state-level Renewable Portfolio Standards (RPS) include preferences for solar generation, with goals of increasing the generation diversity, reducing solar costs, and encouraging local solar industries. Depending on their policy design, these preferences can impact the RPS program costs and emissions reduction. This study evaluates the impact of these policies on costs and emissions, coupling an economic dispatch model with optimized renewable site selection. Three policy designs of an increased RPS in Michigan are investigated: (1) 20% Solar Carve-Out, (2) 5% Distributed Generation Solar Carve-Out, and (3) 3× Solar Multiplier. The 20% Solar Carve-Out scenario was found to increase RPS costs 28%, while the 5% Distributed Generation Solar Carve-Out increased costs by 34%. Both of these solar preferences had minimal impact on total emissions. The 3× Solar Multiplier decreases total RPS program costs by 39%, but adds less than half of the total renewable generation of the other cases, significantly increasing emissions of CO2, NOx, and SO2 relative to an RPS without the solar credit multiplier. Sensitivity analysis of the installed cost of solar and the natural gas price finds small changes in the results of the Carve-Out cases, with a larger impact on the 3× Solar Multiplier.

Emissions reductions from expanding state-level renewable portfolio standards.

In the United States, state-level Renewable Portfolio Standards (RPS) have served as key drivers for the development of new renewable energy. This research presents a method to evaluate emissions reductions and costs attributable to new or expanded RPS programs by integrating a comprehensive economic dispatch model and a renewable project selection model. The latter model minimizes incremental RPS costs, accounting for renewable power purchase agreements (PPAs), displaced generation and capacity costs, and net changes to a state's imports and exports. We test this method on potential expansions to Michigan's RPS, evaluating target renewable penetrations of 10% (business as usual or BAU), 20%, 25%, and 40%, with varying times to completion. Relative to the BAU case, these expanded RPS policies reduce the CO2 intensity of generation by 13%, 18%, and 33% by 2035, respectively. SO2 emissions intensity decreased by 13%, 20%, and 34% for each of the three scenarios, while NOx reductions totaled 12%, 17%, and 31%, relative to the BAU case. For CO2 and NOx, absolute reductions in emissions intensity were not as large due to an increasing trend in emissions intensity in the BAU case driven by load growth. Over the study period (2015 to 2035), the absolute CO2 emissions intensity increased by 1% in the 20% RPS case and decreased by 6% and 22% for the 25% and 40% cases, respectively. Between 26% and 31% of the CO2, SO2, and NOx emissions reductions attributable to the expanded RPS occur in neighboring states, underscoring the challenges quantifying local emissions reductions from state-level energy policies with an interconnected grid. Without federal subsidies, the cost of CO2 mitigation using an RPS in Michigan is between $28 and $34/t CO2 when RPS targets are met. The optimal renewable build plan is sensitive to the capacity credit for solar but insensitive to the value for wind power.

Implementing the Renewable Fuel Standard with the Renewable Portfolio Standard in the US: Implications for Policy Costs and Greenhouse Gas Emissions

The Renewable Fuel Standard (RFS) and state-level Renewable Portfolio Standards (RPS) have the potential to interact in complex ways because they will both rely on biomass for cellulosic biofuels and bio-electricity. This interaction could be synergistic or competitive; while the implementation of the RFS could divert biomass from electricity generation for biofuels it would also generate electricity as a co-product of the cellulosic biofuel production process. This paper examines the welfare costs and greenhouse gas (GHG) emissions effects of the RFS and RPS implemented jointly and compares them with those of implementing each of these policies by itself over the 2007-2030 period using an integrated, dynamic, price endogenous model of the electricity, transportation and agricultural sectors for the US. We also compare the cost effectiveness of these policies implemented jointly with those of a carbon tax that achieves the same level of cumulative reduction in domestic GHG emissions over 2007-2030 period. We find that the implementation of the RFS will raise the welfare costs of implementing the RPS for the electricity sector by 10% and lower its GHG benefits by 7% relative to those with the RPS implemented by itself. We also find that the global welfare costs of the jointly implemented RFS and RPS policies are significantly higher than those of a carbon tax. However, the former induces a larger shift to renewable energy than the carbon tax alone and thus would achieve larger reductions in domestic GHG emissions in the long run than a constant carbon tax policy.

Evaluating Renewable Portfolio Standards for In-State Renewable Deployment: Accounting for Policy Heterogeneity

Renewable portfolio standards (RPS) are the most common state-level policies for promoting renewable electricity in the United States. State RPS policies are heterogeneously designed, particularly with respect to their use of flexibility mechanisms that allow obligations to be met with renewable energy generated in other states. However, the renewable energy that is produced within an RPS-enacting state itself is of high political importance, making in-state renewable energy deployment an important evaluation metric for RPS policies. In this paper, we develop a novel dataset of state-level RPS policies and renewable energy deployment. We show that failing to effectively limit comparisons to similarly designed RPS policies may lead to the misperception that more stringent RPS policies do not necessarily lead to higher renewable deployment. We then show that after controlling for specific policy design features, states with more stringent RPS policies tend to have greater in-state renewable energy deployment. Specifically, we find that a 1 percentage point increase in the stringency of an RPS policy is associated with a 0.28-0.29 percentage point increase in the share of in-state renewable electricity capacity. Articulate modeling of policy variety has been largely lacking from past studies and is essential for accurate econometric analysis of heterogeneous energy policies.

Introduction: Environmental Sustainability Symposium

The issue of environmental sustainability is a controversial and extremely diverse multi-faceted topic that ranges from questions as to how to ensure that adequate investment in energy R&D and infrastructure will be undertaken, to state level renewable portfolio standards, to the impact of pollution havens on legislation that would enhance industrial greenhouse gas emission standards, to economic resilience to hurricane hazards, and to EPA policies. This paper summarizes seven studies that are devoted to exploring various aspects of the remarkably complex and diverse dimensions of environmental sustainability.

U.S. West: The Next Energy Nexus

DOI 10.1515/cjpp-2013-0047 Calif. J. Politics Policy 2014; 6(1): 127–151 Sandra K. Davis* and Andrew R. Kear U.S. West: The Next Energy Nexus Abstract: Federal and state policies have historically privileged fossil fuel devel- opment in the western US. Presently, these abundant conventional energy sources remain important economic contributors to western state and federal coffers but rising energy demand, calls for energy independence, and climate change concerns bring conventional energy into conflict with next generation renew- able energy. In the open policy terrain afforded by federalism, western states are leading the way through this intercurrence, or intervening time, when politics simultaneously promote conventional and renewable energy policies. Our central research goal is to chronicle and explain this energy policy intercurrence through the conceptual lenses of resource abundance, path dependence, and federalism. The state of western US energy policy will remain in flux as the intercurrence of two energy policy paradigms plays out through the first half of the 21st century and western states remain at the policy nexus. Keywords: energy policy; fossil fuel; next generation energy policy; renewable energy; western states. *Corresponding author: Sandra K. Davis, Political Science, Colorado State University, Campus Delivery 1782, Ft. Collins, Colorado 80525, USA, e-mail: sandra.davis@colostate.edu Andrew R. Kear: Political Science/Environment and Sustainability, Bowling Green State University, Bowling Green, Ohio, USA 1 Introduction Long-standing state and federal policies promoting development of the U.S. West’s abundant energy resources drive the political institutions and attendant energy policies down a conventional, predominately fossil fuel, path. Presently, these conventional energy sources remain important economic contributors to western state and federal treasuries but rising energy demand, calls for energy independence, and climate change concerns bring conventional energy into conflict with next generation renewable energy. Next generation energy policies like state-level renewable portfolio standards (RPS) and executively driven wind and solar projects on public lands encourage development of these abundant western renewable energy sources. These new energy policies rest uneasily upon

Regional Assessment of Woody Biomass Physical Availability as an Energy Feedstock for Combined Combustion in the US Northern Region

Woody biomass is a renewable energy feedstock with the potential to reduce current use of nonrenewable fossil fuels. We estimated the physical availability of woody biomass for cocombustion at coal-fired electricity plants in the 20-state US northern region. First, we estimated the total amount of woody biomass needed to replace total annual coal-based electricity consumption at the state level to provide a representation of the potential energy footprints associated with using woody biomass for electric energy. If all woody biomass available were used for electric generation it could replace no more than 19% of coal-based electric generation or 11% of total electric energy generation. Second, we examined annual woody biomass increment at the state level in a series of concentric circles around existing coal-fired electricity plants to examine some of the opportunities and limitations associated with using woody biomass for cofiring at those plants to coincide with state-level renewable portfolio standards. On average, an individual coal-fired power electricity plant could theoretically replace 10% of annual coal use if it obtained 30% of the net annual woody biomass increment within a 34-km radius of the plant. In reality, the irregular spatial distribution of coal-fired power plants means potential biomass supply zones overlap and would greatly diminish opportunities for cofiring with biomass, numerous other regulatory, economic, and social considerations notwithstanding. Given that woody biomass use for electricity will be limited to selected locations, use of woody biomass for energy should be complementary with other forest conservation goals.

Green Corridors: Linking Interregional Transmission Expansion and Renewable Energy Policies

A variety of recent policy measures have been advanced to promote interregional power transmission investment in the United States; among these are the designation of corridors on federal lands in western states and the identification of national interest electric transmission corridors across the country. Although these corridors have been put forward as critical policy interventions to modernize an aging transmission system, their effectiveness could be undermined by parallel policies, such as renewable portfolio standards (RPSs), designed to alter the landscape for new investment in generation capacity. This paper presents the results of a scenario analysis of the relationship between the interregional power grid and renewables policies to evaluate 1) the effects of state and national RPS policies on interregional power flows and 2) the impacts of transmission expansion on the locations and types of new, renewable sources for electricity capacity additions. Using the RFF Haiku Electricity Market Model, we find that the locations of transmission corridors could have a significant impact on the location, type, and marginal cost of generation in the future. Conversely, a national RPS would induce interregional power flows across the country significantly different from those that would prevail in the absence of such a policy. In particular, a national RPS would promote western renewables and shift power flows to the East. Under either a set of state-level RPS policies or a national RPS, the majority of power flowing into California will come from the Pacific Northwest, not from the Southwest, which is where corridors are most abundant. Additionally, a national RPS could motivate more than 10 GW of new biomass capacity in the Southeast, but grid expansion could shift 6 GW of this capacity to the Plains states and western wind.