State renewable energy electricity policies: An empirical evaluation of effectiveness

Over the past decade, state governments have emerged as US energy policy leaders. Across the country, states are adopting policy instruments aimed at carbon mitigation and renewable energy deployment. One of the most prevalent and innovative policy instruments is a renewable portfolio standard (RPS), which seeks to increase the share of renewable energy electrification in the electricity market. This analysis evaluates the effectiveness of state energy programs with an empirical investigation of the linkage between state RPS policy implementation and the percentage of renewable energy electricity generation across states. We use a variant of a standard fixed effects model, referred to as a fixed effects vector decomposition, with state-level data from 1998 to 2006. Results indicate that RPS implementation is not a significant predictor of the percentage of renewable energy generation out of the total generation mix, yet for each additional year that a state has an RPS policy, they are found to increase the total amount of renewable energy generation. These findings reveal a potentially significant shortcoming of RPS policies. Political institutions, natural resource endowments, deregulation, gross state product per capita, electricity use per person, electricity price, and the presence of regional RPS policies are also found to be significantly related to renewable energy deployment.     

Renewable energy and policy options in an integrated ASEAN electricity market: Quantitative assessments and policy implications

Energy market integration (EMI) in the ASEAN region is a promising solution to relieve the current immobilization of its renewable energy resources and would serve the fast increasing demand for electricity in the region. EMI could be further extended with coordinated policies in carbon pricing, renewable energy portfolio standards (RPS), and feed-in-tariffs (FIT) in the ASEAN countries. Using a linear dynamic programming model, this study quantitatively assesses the impacts of EMI and the above-mentioned policies on the development of renewable energy in the power generation sector of the region, and the carbon emissions reduction achievable with these policies. According to our results, EMI is expected to significantly promote the adoption of renewable energy. Along with EMI, FIT appears to be more cost-effective than RPS and is recommended for the ASEAN region, albeit political barriers for policy coordination among the countries might be a practical concern. In addition, an RPS of 30% electricity from renewable sources by 2030, which is considered politically a “low-hanging fruit”, would achieve moderate improvements in carbon emissions reductions and renewable energy development, while incurring negligible increases in the total cost of electricity.     

Cost-effectiveness of renewable electricity policies

We analyze policies to promote renewable sources of electricity. A portfolio standard (RPS) raises electricity prices and primarily reduces gas-fired generation. A knee of the cost curve exists between 15% and 20% goals for 2020 in our central case, and higher natural gas prices lower the cost of greater reliance on renewables. A renewable energy production tax credit lowers electricity price at the expense of taxpayers, which limits its effectiveness in reducing carbon emissions, and it is less cost-effective at increasing renewables than a portfolio standard. Neither policy is as cost-effective as a cap-and-trade policy for achieving carbon emission reductions.     

Decarbonization of the U.S. electricity sector: Are state energy policy portfolios the solution?

State governments have taken the lead on U.S. energy and climate policy. It is not yet clear, however, whether state energy policy portfolios can generate results in a similar magnitude or manner to their presumed carbon mitigation potential. This article seeks to address this lack of policy evidence and contribute empirical insights on the carbon mitigation effects of state energy portfolios within the U.S. electricity sector. Using a dynamic, long-term electricity dispatch model with U.S. power plant, utility, and transmission and distribution data between 2010 and 2030, this analysis builds a series of state-level policy portfolio scenarios and performs a comparative scenario analysis. Results reveal that state policy portfolios have modest to minimal carbon mitigation effects in the long run if surrounding states do not adopt similar portfolios as well. The difference in decarbonization potential between isolated state policies and larger, more coordinated policy efforts is due in large part to carbon leakage, which is the export of carbon intensive fossil fuel-based electricity across state lines. Results also confirm that a carbon price of $50/metric ton CO₂e can generate substantial carbon savings. Although both policy options – an energy policy portfolio or a carbon price – are effective at reducing carbon emissions in the present analysis, neither is as effective alone as when the two strategies are combined.     

A retrospective analysis of benefits and impacts of U.S. renewable portfolio standards

As states consider revising or developing renewable portfolio standards (RPS), they are evaluating policy costs, benefits, and other impacts. We present the first U. S. national-level assessment of state RPS program benefits and impacts, focusing on new renewable electricity resources used to meet RPS compliance obligations in 2013. In our central-case scenario, reductions in life-cycle greenhouse gas emissions from displaced fossil fuel-generated electricity resulted in $2.2 billion of global benefits. Health and environmental benefits from reductions in criteria air pollutants (sulfur dioxide, nitrogen oxides, and particulate matter 2.5) were even greater, estimated at $5.2 billion in the central case. Further benefits accrued in the form of reductions in water withdrawals and consumption for power generation. Finally, although best considered resource transfers rather than net societal benefits, new renewable electricity generation used for RPS compliance in 2013 also supported nearly 200,000 U. S.-based gross jobs and reduced wholesale electricity prices and natural gas prices, saving consumers a combined $1.3–$4.9 billion. In total, the estimated benefits and impacts well-exceed previous estimates of RPS compliance costs.     

State-scale evaluation of renewable electricity policy: The role of renewable electricity credits and carbon taxes

We have developed a state-scale version of the MARKAL energy optimization model, commonly used to model energy policy at the US national scale and internationally. We apply the model to address state-scale impacts of a renewable electricity standard (RES) and a carbon tax in one southeastern state, Georgia. Biomass is the lowest cost option for large-scale renewable generation in Georgia; we find that electricity can be generated from biomass co-firing at existing coal plants for a marginal cost above baseline of 0.2–2.2 cents/kWh and from dedicated biomass facilities for 3.0–5.5 cents/kWh above baseline. We evaluate the cost and amount of renewable electricity that would be produced in-state and the amount of out-of-state renewable electricity credits (RECs) that would be purchased as a function of the REC price. We find that in Georgia, a constant carbon tax to 2030 primarily promotes a shift from coal to natural gas and does not result in substantial renewable electricity generation. We also find that the option to offset a RES with renewable electricity credits would push renewable investment out-of-state. The tradeoff for keeping renewable investment in-state by not offering RECs is an approximately 1% additional increase in the levelized cost of electricity.     

Weighing the costs and benefits of state renewables portfolio standards in the United States: A comparative analysis of state-level policy impact projections

State renewables portfolio standards (RPS) have emerged as one of the most important policy drivers of renewable energy capacity expansion in the U.S. As RPS policies have been proposed or adopted in an increasing number of states, a growing number of studies have attempted to quantify the potential impacts of these policies, focusing primarily on cost impacts, but sometimes also estimating macroeconomic, risk reduction, and environmental effects. This article synthesizes and analyzes the results and methodologies of 31 distinct state or utility-level RPS cost-impact analyses completed since 1998. Together, these studies model proposed or adopted RPS policies in 20 different states. We highlight the key findings of these studies on the projected costs of state RPS policies, examine the sensitivity of projected costs to model assumptions, evaluate the reasonableness of key input assumptions, and suggest possible areas of improvement for future RPS analyses. We conclude that while there is considerable uncertainty in the study results, the majority of the studies project modest cost impacts. Seventy percent of the state RPS cost studies project retail electricity rate increases of no greater than 1%. Nonetheless, there is considerable room for improving the analytic methods, and therefore accuracy of these estimates.     

Impacts of a renewable portfolio generation standard on US energy markets

This paper analyzes the impacts of imposing a Federal 20 percent non-hydropower renewable generation portfolio standard (RPS) on US energy markets by 2020. The US currently has no RPS requirement although some state RPS regulations have been adopted but not uniformly enforced (see http://www.eia.doe.gov/oiaf/analysispaper/rps/index.html for a recent summary on RPSs in the US). The renewable portfolio standard (RPS) requires that 20 percent of the power sold must come from qualifying renewable facilities. The analysis of the 20 percent RPS was developed by using the December 2001 version of the National Energy Modeling System (NEMS) of the Energy Information Administration (EIA) and the assumptions and results of the Annual Energy Outlook 2002 (AEO2002) reference case. ² A policy that requires a 20 percent non-hydro-electric RPS by 2020 appears to be effective in promoting the adoption of renewable generation technologies while also reducing emissions of nitrogen oxides by 6 percent, mercury by 4 percent and carbon dioxide by about 16.5 percent relative to the reference case in 2020. Electricity prices are expected to rise about 3 percent while the cost to the electric power industry could rise between 35 and 60 billion dollars (in year 2000 dollars in net present value terms).     

Oil and natural gas prices and greenhouse gas emission mitigation

The hikes in hydrocarbon prices during the last years have lead to concern about investment choices in the energy system and uncertainty about the costs for mitigation of greenhouse gas emissions. On the one hand, high prices of oil and natural gas increase the use of coal; on the other hand, the cost difference between fossil-based energy and non-carbon energy options decreases. We use the global energy model TIMER to explore the energy system impacts of exogenously forced low, medium and high hydrocarbon price scenarios, with and without climate policy. We find that without climate policy high hydrocarbon prices drive electricity production from natural gas to coal. In the transport sector, high hydrocarbon prices lead to the introduction of alternative fuels, especially biofuels and coal-based hydrogen. This leads to increased emissions of CO₂. With climate policy, high hydrocarbon prices cause a shift in electricity production from a dominant position of natural gas with carbon capture and sequestration (CCS) to coal-with-CCS, nuclear and wind. In the transport sector, the introduction of hydrogen opens up the possibility of CCS, leading to a higher mitigation potential at the same costs. In a more dynamic simulation of carbon price and oil price interaction the effects might be dampened somewhat.     

Putting renewables and energy efficiency to work: How many jobs can the clean energy industry generate in the US?

An analytical job creation model for the US power sector from 2009 to 2030 is presented. The model synthesizes data from 15 job studies covering renewable energy (RE), energy efficiency (EE), carbon capture and storage (CCS) and nuclear power. The paper employs a consistent methodology of normalizing job data to average employment per unit energy produced over plant lifetime. Job losses in the coal and natural gas industry are modeled to project net employment impacts. Benefits and drawbacks of the methodology are assessed and the resulting model is used for job projections under various renewable portfolio standards (RPS), EE, and low carbon energy scenarios We find that all non-fossil fuel technologies (renewable energy, EE, low carbon) create more jobs per unit energy than coal and natural gas. Aggressive EE measures combined with a 30% RPS target in 2030 can generate over 4 million full-time-equivalent job-years by 2030 while increasing nuclear power to 25% and CCS to 10% of overall generation in 2030 can yield an additional 500,000 job-years.     

美国加州可再生能源配额制及对我国的启示

配额制本质上是一种对可再生能源开发的激励机制,它的实施需要具备一定的前提条件,目前仍处于不断探索和发展阶段。配额制的实质是以最低成本开发可再生能源,它通常需要依托一个绿色证书市场。任何配额制基本上都包含了配额承担主体及合格的发电类型、配额目标的确定及分解、运作机制、成本分摊与惩罚措施等内容。世界上没有任何两个国家或地区的配额制是完全一致的,均是根据本国或本地区的实际情况而制定。加利福尼亚州是美国可再生能源发展较快,也是最早实施配额制的联邦州之一。加州配额制的配额承担主体主要是为终端用户供电的电力企业;运作机制是通过绿色证书来代替物理计量,以证书数量来反映配额承担主体的履约情况;实现配额义务的成本是通过终端销售电价疏导出去的。这些与英国和日本的配额制相同,而差异性体现在配额目标形式不同、指标分解原则不同以及对不同类型可再生能源的激励程度不同。我国在可再生能源配额制设计中需要关注与现行可再生能源政策的衔接、地区配额指标的差异化设计、地方政府的责任、可再生能源电量的计量以及保障措施等问题。     

Creating a level playing field? The concentration and centralisation of emissions in the European Union Emissions Trading System

This article questions the assumption that carbon markets create a level playing field by exploring the relationship between the organisation of capital and the organisation of emissions in the European Union Emissions Trading System (EU ETS). It constructs a database by matching installations and owners to reveal that a relatively small number of large-scale coal-fired power stations, owned by a very small group of states and corporations, are responsible for a significant proportion of greenhouse gas emissions. The findings are analysed by considering how technological dependence on coal together with the corporate institutional form combine to support the socio-spatial concentration and centralisation of capital and emissions. Case studies of the consolidation of the seven largest polluting owners from Europe's coal-dependent electricity sector and the carbon trading strategies of the two largest polluters, RWE and E.ON, then assess the impacts of energy liberalisation and emissions trading policies. The article concludes that EU energy and climate policies are pulling in different directions by clustering responsibility for greenhouse gas emissions and diffusing responsibility to address climate change. The uneven distribution of emissions within the EU ETS makes an alternative policy approach that directly targets the biggest corporate and state polluters both feasible and necessary.     

Evaluation of potential co-benefits of air pollution control and climate mitigation policies for China's electricity sector

Since the rapid industrialisation, local air pollution has become one of China's most important environmental issues. In consequence, increasingly stringent air pollution control policies have been established by the Chinese government. These policies will inevitably affect China's future electric power investment given the key contribution of this sector to air pollution. This sector is also a key contributor to China’s greenhouse gas emissions and hence climate policy efforts. We present a study exploring what impacts of potential interactions and combinations of different policy efforts for local air pollutant control and carbon mitigation have on China's future electricity generation mix. The study utilises a novel generation portfolio model that explicitly incorporates key uncertainties in future technology costs and different policy approaches including carbon pricing and air emissions control. The findings highlight that China can achieve significant reductions for both greenhouse gas and local air pollutant emissions through a combination of climate change and air pollution control policies. Furthermore, there are potentially significant co-benefits from the perspectives of both air pollutant control and carbon mitigation and, notably, that the co-benefit from a sufficient carbon pricing policy to air pollution emission reductions is much stronger than that from stringent air pollutant control policies to carbon mitigation. Specifically, in order to achieve substantial local air pollution and greenhouse gas mitigation from China's electricity sector, it is necessary to close coal-fired power plants rather than merely seeking to clean their air pollution emissions up.     

Renewable energy technologies for the Indian power sector: mitigation potential and operational strategies

The future economic development trajectory for India is likely to result in rapid and accelerated growth in energy demand, with attendant shortages and problems. Due to the predominance of fossil fuels in the generation mix, there are large negative environmental externalities caused by electricity generation. The power sector alone has a 40 percent contribution to the total carbon emissions. In this context, it is imperative to develop and promote alternative energy sources that can lead to sustainability of the energy–environment system. There are opportunities for renewable energy technologies under the new climate change regime as they meet the two basic conditions to be eligible for assistance under UNFCCC mechanisms: they contribute to global sustainability through GHG mitigation; and, they conform to national priorities by leading to the development of local capacities and infrastructure. This increases the importance of electricity generation from renewables. Considerable experience and capabilities exist in the country on renewable electricity technologies. But a number of techno–economic, market-related, and institutional barriers impede technology development and penetration. Although at present the contribution of renewable electricity is small, the capabilities promise the flexibility for responding to emerging economic, socio–environmental and sustainable development needs. This paper discusses the renewable and carbon market linkages and assesses mitigation potential of power sector renewable energy technologies under global environmental intervention scenarios for GHG emissions reduction. An overall energy system framework is used for assessing the future role of renewable energy in the power sector under baseline and different mitigation scenarios over a time frame of 35 years, between 2000 to 2035. The methodology uses an integrated bottom-up modelling framework. Looking into past performance trends and likely future developments, analysis results are compared with officially set targets for renewable energy. The paper also assesses the CDM investment potential for power sector renewables. It outlines specific policy interventions for overcoming the barriers and enhancing deployment of renewables for the future.     

Evaluating renewable portfolio standards and carbon cap scenarios in the U.S. electric sector

This report examines the impact of renewable portfolio standards (RPS) and cap-and-trade policy options on the U.S. electricity sector. The analysis uses the National Renewable Energy Laboratory's Regional Energy Deployment System (ReEDS) model that simulates the least-cost expansion of electricity generation capacity and transmission in the U.S. to examine the impact of a variety of emissions caps—and RPS scenarios both individually and combined. The generation mix, carbon emissions, and electricity price are examined for various policy combinations simulated in the modeling.     

The feasibility of co-firing biomass for electricity in Missouri

Bioenergy is one of the most significant energy resources with potential to serve as a partial replacement for fossil. As an agricultural state, Missouri has great potential to use biomass for energy production. In 2008, Missouri adopted a renewable portfolio standard (RPS) yet about 80% of its power supply still comes from coal. This paper describes a feasibility study of co-firing biomass in existing coal-powered plants in Missouri. Specifically, this study developed a linear programming model and simulated six scenarios to assess the economic feasibility and greenhouse gas impacts of co-firing biomass in existing qualified coal power plants in Missouri.The results of this study indicate that although co-firing can reduce the emissions of GHG and environmental pollutants, it is still not an economically feasible option for power generation without additional economic or policy incentives or regulations which could take environmental costs into account. Based on these results, strategies and policies to promote the utilization of biomass and to increase its competitiveness with fossil fuels are identified and discussed.     

Regulating existing power plants under the U.S. Clean Air Act: Present and future consequences of key design choices

In June 2014, the U.S. EPA released its proposed rules to regulate carbon dioxide emissions from existing fossil fuel power plants, triggering considerable debate on the proposal’s design and its environmental and economic consequences. One question not addressed by this debate is this: What if the EPA regulations turn out to be inadequate to address future mitigation goals? That is, what will the landscape for future policies look like if these regulations turn out to be just an interim measure? This analysis compares potential short- and long-term consequences of several key regulatory design choices, including mass-based versus rate-based standards, tradable versus non-tradable standards, and differentiated versus single standards. It finds that long-term consequences may be significant in terms of the legacy they leave for future policy revisions: tradable standards lead to lower electricity prices and become weaker over time; differentiated tradable standards lead to relatively greater investment in coal retrofits; non-tradable standards lead to relatively greater retirement of coal capacity. It may be the case that key policy choices entail one set of trade-offs if proposed EPA rules are viewed as relatively permanent and final and another set of tradeoffs if the rules are viewed as an interim solution.     

Engineering economic analysis of biomass IGCC with carbon capture and storage

Integration of biomass energy technologies with carbon capture and sequestration could yield useful energy products and negative net atmospheric carbon emissions. We survey the methods of integrating biomass technologies with carbon dioxide capture, and model an IGCC electric power system in detail. Our engineering process model, based on analysis and operational results of the Battelle/Future Energy Resources Corporation gasifier technology, integrates gasification, syngas conditioning, and carbon capture with a combined cycle gas turbine to generate electricity with negative net carbon emissions. Our baseline system has a net generation of 123 MW_e, 28% thermal efficiency, 44% carbon capture efficiency, and specific capital cost of 1,730 $ kW_e⁻¹. Economic analysis suggests this technology could be roughly cost competitive with more conventional methods of achieving deep reductions in CO₂ emissions from electric power. The potential to generate negative emissions could provide cost-effective emissions offsets for sources where direct mitigation is expected to be difficult, and will be increasingly important as mitigation targets become more stringent.     

Hybrid modelling of long-term carbon reduction scenarios for the UK

This paper summarizes the development of a new hybrid MARKAL–Macro (M–M) energy system model for the UK. This hybrid model maintains the technological and sectoral detail of a bottom-up optimisation approach with aggregated energy demand endogeneity and GDP impacts from a single sector neoclassical growth model. The UK M–M model was developed for underpinning analysis of the UK's groundbreaking mandatory long-term − 60% carbon dioxide (CO₂) emissions reduction target. Hybrid modelling illustrates that long-term UK CO₂ emission reductions are feasible. However, there are endemic uncertainties, notably a trade-off between behavioural and technological decarbonisation options with resultant energy system impacts in the requirements for zero-carbon electricity. UK M–M model sensitivity runs further illustrate the range of energy system interactions including the deployment of the UK's limited CO₂ storage capacity, alternate timing of power vs. transport sectoral reductions, the relative ease of switching between electricity generation portfolios, and substitution opportunities between natural gas and coal. The macro-economic cost impacts range from 0.3% to 1.5% reduction in UK GDP by 2050, with higher cost estimates strongly influenced by pessimistic assessments of future low-carbon technologies. However cost impacts from the UK M–M model are likely to be in the lower range for stringent CO₂ reduction pathways as the simplicity of the reduced form macro-linkage omits competitiveness and transitional impacts on the UK economy.     

Spatial variation of emissions impacts due to renewable energy siting decisions in the Western U.S. under high-renewable penetration scenarios

One of the policy goals motivating programs to increase renewable energy investment is that renewable electric generation will help reduce emissions of CO₂ as well as emissions of conventional pollutants (e.g., SO₂ and NO_x). As a policy instrument, Renewable Portfolio Standards (RPS) encourage investments in wind, solar and other generation sources with the goal of reducing air emissions from electricity production. Increased electricity production from wind turbines is expected to displace electricity production from fossil-fired plants, thus reducing overall system emissions. We analyze the emissions impacts of incremental investments in utility-scale wind power, on the order of 1 GW beyond RPS goals, in the Western United States using a utility-scale generation dispatch model that incorporates the impacts of transmission constraints. We find that wind investment in some locations leads to slight increases in overall emissions of CO₂, SO₂ and NO_x. The location of wind farms influences the environmental impact by changing the utilization of transmission assets, which affects the overall utilization of power generation sources and thus system-level emissions. Our results suggest that renewable energy policy beyond RPS targets should be carefully crafted to ensure consistency with environmental goals.