ORIGINAL REPORTING: How State Renewables Mandates Drive New Energy
As utilities build toward RPS standards, costs, carve-outs raise concerns; An LBNL report shows utilities are largely meeting their renewable energy targets, but new challenges are emerging
Herman K. Trabish, April 25, 2016 (Utility Dive)
Editor’s note: During the Trump era, state actions will be determinative for the future of New Energy.
Utiility leaders often say they can meet whatever policy obligations states impose if the policies are clear. Data compiled from utility compliance filings show they are incorporating the renewable energy capacity into their generation portfolios as required of them by interim state mandate targets and are on track to meet the renewable portfolio standard (RPS) obligations ahead if compliance costs don’t derail the programs. Utilities met 95% of their 2000 to 2015 RPS obligations in 2014 and 94% in 2013, according to the U.S. Renewables Portfolio Standards 2016 Annual Status Report.
An RPS is a requirement of retail electric suppliers, typically utilities, to use renewables to supply a minimum percentage or amount of retail load. They usually face a penalty for failing to comply. The RPS policies in 29 states and the District of Columbia (DC), no two of which are the same, apply to 55% of U.S. electricity sales. Of the 100 GW of non-hydro renewables capacity added to U.S. generation since 2000, 60% of renewable electricity generation and 57% of renewables capacity has been contracted to load serving entities for RPS-associated reasons. The cost of RPS compliance was 0.8% of the average retail electricity bill in 2012, 1.0% in 2013, and 1.3% of the bill in 2014. Even with the $0.5 billion total increase, it was a very small portion of an electricity customer’s bill, though the year-over-year percentage increases are significant and that could limit renewable development…