Federal, State, and International Renewable Energy Programs

Integrated Resource Planning: The Energy Policy Act of 1992 mandated the use of integrated resource planning to force producers to consider “demand side” rather than only “supply side” options. This includes the use of renewable energy and energy efficiency planning. However, the move away from centralized planning shut down most of the IRP.

This lack of centralized planning seems to have been replaced by the move toward “Renewable Portfolio Standards.” These standards require a specific percentage of power sold by electricity retailers to be derived from renewables.

My Thoughts:

  1. The combination of these first two subjects makes me think that “centralized planning” in the area of energy policy is a necessity. RPS is no less of a top-down approach than IRP, and yet RPS continues to have a strong push even in our haste to move to a deregulated energy market.
  2. RPS raises some problems not discussed in depth in the book. Issues such as what sorts of renewable should be required. Most RPS have some renewable that “count” and some that don’t to avoid fostering the development of “bad” renewable energy. For example, the criticism of wind power as a threat to bird populations in states where migration patterns would make this a huge concern. Are there any renewable you would like to see excluded or specifically included in a national RPS?
  3. I also wanted to point to the note about the Wheelabrator court: finding that the QF projects attributes are conveyed to power purchasers, allowing them to count the generation toward RPS compliance. However other courts considering “net metered projects” disallow this because the RECs belong to customer-generators.
  4. “Net metering” is where an individual consumer will create his/her own power and be given a credit depending on how much energy he/she replaces on the grid.
  5. This distinction between the two decisions seems to be heading in the right direction to me. It prevents the power companies from “free-riding” on consumers.

Dormant Commerce Clause Problems

The author suggests a couple of changes on page 889. Although they are not laid out in detail, I do not think the distinctions he makes are going fly. For example, as to his first option, the prevention of environmental degradation as a general category is not an exception to the DCC right now. However, there are cases that allow discrimination to prevent some impending harm that will otherwise not be resolved without discrimination. There was a case where out of state fisheries were importing foods that contained “invasive species” that would destroy the environment. The Supreme Court upheld the bad on these imports to survive the DCC because it was designed specifically to avoid environmental problems. Perhaps this exception could be expanded in the area of environmental harm specifically? The problem with that is renewable rich states will be in a much better position vis-à-vis non renewable states to discriminate.

Federal RPS:

The best critique to me has always been that some states are more “rich” in renewable, and thus would be less affected by a national RPS plan. However, the REC program seems to solve at least some of this criticism. Also, it does not take into account the benefits states can gain by having a cleaner nation as a whole. Furthermore, RPSwill likely jumpstart an industry of “green technology” production. We are falling behind Europe and India in this race to new technologies, driven in part by the demand for greener technologies. A national RPS would foster R&D into these technologies and help a floundering manufacturing industry as well. Overall, a national RPS is probably more beneficial than detrimental.