Today, the United States’ electricity mix is primarily generated by climate-change causing, air-polluting fossil fuels. More than 60% of the nation’s total generation comes from natural gas, coal, and petroleum. Recent headlines have celebrated the fact that renewable energy generation–at 21.5%– finally surpassed coal (19.5%) for the first time in 2022. However, there is still a long way to go to achieve our climate change and greenhouse gas (GHG) emissions goals.
One tool that has contributed to the U.S.’s increasing generation of renewable energy is Renewable Portfolio Standards (RPS). The goal of an RPS is to change the electricity generation in a state by setting minimum percentage requirements from renewable sources such as solar, wind, hydropower, or geothermal energy.
In 1983, Iowa passed the first Renewable Portfolio Standard in the United States. Since then, more than 37 states have adopted an RPS. Each state varies in its percentage target, stringency (i.e., voluntary v. mandatory), eligible renewable sources, and the timeline for implementation. Seven states have voluntary standards–including Indiana–while the rest have more stringent mandatory requirements.
The amount of renewable resources in a state varies immensely as solar, wind, hydropower, and geothermal resources are not evenly distributed. Figure 2 showcases the total renewable resource potential in each state.
Despite Indiana’s high renewable potential as seen in the map, more than 90% of our electricity is still generated by coal and natural gas. This is largely because we have a weak RPS, which is a voluntary requirement for utilities to generate 10% of electricity from renewables.
Figure 2: Estimated total potential renewable resource generation of solar, wind, geothermal, and hydropower resources. Sourced from the National Renewable Energy Laboratory, 2016.
My research sought to determine what factors shape a state’s adoption of an RPS, and how those same factors can increase the stringency of these standards. Some states, like Virginia, have stringent standards that require 100% of electricity to come from renewable resources by 2045. With similar resource endowments in Indiana and Virginia as shown in Figure 2, what factors are at play that cause these two states’ RPSs to differ?
To answer this question, I took a look at the renewable energy potential, unemployment rate, and quantitative measures of political ideology in a state. This will help to determine if renewable resource potential is important for RPS adoption and stringency, or if economic conditions and/or political ideology are more important. I have found that political ideology and unemployment rate are significant factors that lead to a state adopting an RPS. Surprisingly, renewable energy potential was not found to impact RPS adoption.
However, having high renewable resources in a state does increase the stringency of an RPS. So while potential energy is not an important factor when it comes to first adopting an RPS, it is a key factor in determining how state legislators decide to mandate renewables in electricity generation.
This finding aligns well with the general trends shown in Figure 2. While Indiana has high renewable potential, it was the political ideology and unemployment rate that had a larger impact on choosing not to adopt a mandatory RPS.
These findings can assist future states in their attempt to pass an RPS by framing the policy in terms of economic benefits and political ideology. This can help the U.S. increase our renewable energy generation and decrease our reliance on fossil fuels, to reach our clean energy future!
Eva Brungard is a senior at the O’Neill School of Public and Environmental Affairs graduating in May 2023 with a BS in Public Affairs. She majored in Policy Analysis with minors in Political Science and Economics. After graduation, she will pursue a Master of Public Policy at Duke University.
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