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RPS aff
State electricity regulations are governed by a patchwork of conflicting renewable portfolio standards – this
regulatory confusion prevents the development of an effective renewables market and increases costs
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
None of the existing state RPS mandates are alike. Wisconsin, for example, has set its RPS target at 2.2 percent by 2011, while Rhode Island
is shooting for 16 percent by 2020. In Maine, fuel cells and high efficiency cogeneration count as “renewable”, while the standard in Pennsylvania
includes coal gasification and non-renewable distributed generation. Iowa, Minnesota, and Texas set purchase requirements based on installed capacity,
while many other states make it a function of electricity sales. Minnesota and Iowa have voluntary standards, while Massachusetts, Connecticut, Rhode
Island, and Pennsylvania all levy different noncompliance fees.25 States vary in their targets, definitions of eligible resources, purchase
requirements, renewable energy credit (REC) trading schemes, and compliance mechanisms, among other things.
Conflicts over Statutes
Amid this complex morass of regulations, stakeholders and investors must not only grapple with inconsistencies, they are
forced to decipher vague and often contradictory state statutes.26 In Connecticut, for example, the state’s Department of Public Utility
Control originally exempted two of the state’s largest utilities from RPS obligations because the description of “electric suppliers” in the statute was
unclear. These exemptions created uncertainty over whether the statute would be enforced against any utilities at all.27 Hawaii’s standard contained so
much “wiggle room” that it was unclear even to its own advocates whether it applied to most of the state’s utilities.28 Such ambiguity has lead to “wide
disagreements among parties in regulatory proceedings” about how to enforce some state RPS mandates. 29
In testimony before the U.S. Senate Committee on Energy and Natural Resources, Don Furman, a senior VP at PacifiCorp, lamented how “for multi-
state utilities, a series of inconsistent requirements and regulatory frameworks will make planning, building and acquiring
generating capacity on a multi-state basis confusing and contradictory.”30
Limits on Distributed Generation (DG)
The current state-by-state approach to RPS is also inhibiting the expansion of distributed generation technologies by forcing unusually prohibitive
operational procedures. Inconsistent tariff structures and interconnection requirements, for example, add complexity (and therefore cost) to distributed
generation projects. In fact, the Clean Energy Group, a coalition of electric generating and electric distribution companies committed to responsible
environmental stewardship, forecasts that fuel cells and community-scale wind energy projects are unlikely to play a meaningful role in state RPS
markets until policymakers adopt a more comprehensive and uniform approach.31
Uncertain Policy Duration
The complexity of state-based RPS statutes is compounded by uncertainty over the duration of many state RPS programs.
Stakeholders trying to plan investments in state renewable energy markets are tormented with unknowns. 32 New Jersey, New
York, and Rhode Island, for example, will review and potentially modify their RPS schemes in 2008, 2009, and 2010, respectively.
Hawaii’s standard expressly allows for its requirements to be waived if they prove to be “too costly” for retail electric providers and consumers.33
Arizona, New Mexico, and Maine may terminate their RPS programs entirely. 34
The market disruptions created by complex and often conflicting state RPS mandates are not merely “academic” concerns voiced only by staunch
renewable energy advocates. In comments to the New York State Public Service Commission, Executives from Constellation Energy – a utility serving
1.2 million customers in Baltimore and more than 10,000 commercial and industrial customers in 34 states – complained that many state RPS
programs “unnecessarily burden interstate commerce, raise the cost of compliance, invite retaliatory discrimination,
potentially violate the Commerce Clause, reduce the availability of imports, and are ‘impractical’ given the inability to
track electrons.”35
Risks Increase Costs
When renewable energy policy is predictable and stable, long-term project financing follows.
Potential investors are less likely to assume persistent risks where legislative or regulatory commitments are weak or
constantly changing. Regulatory uncertainty creates substantial direct and opportunity costs for the nation’s renewable
energy market. Ten years ago, researchers at Lawrence Berkeley National Laboratory estimated that the uncertainties
generated by inconsistent and unpredictable energy policies may increase the costs of renewable energy projects up to 50
percent compared to the probable costs under stable regulatory environments.36 It is not an exaggeration, therefore, to
suggest that the instability inherent in a state-based approach to RPS is dramatically distorting private investments in
renewable energy generation nationally and prohibiting the expansion of a robust renewable energy sector in the United
States.
A federal mandate is critical to correcting these market distortions and signaling a national commitment to renewable
energy generation. A federal policy would promote a national renewable energy technology sector that contributes to the
U.S. economy, weans the nation from foreign and polluting sources of energy and decreases the real and social costs of
electricity for American consumers.
ENDI 08 4
RPS aff
Natural gas reliance is increasing for electricity generation – it makes price spikes inevitable
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Many of the electricity generating units used for intermediate and “peaking” purposes (for example, to meet increased
demand for air conditioning on hot, summer days) use natural gas for fuel. This is because natural gas generating units
usually require a lower capital investment than nuclear or coal-fired plants, have shorter construction and lead-times, and
tend to produce lower emissions than coal plants. Natural gas-fired units also can be turned on or off quickly, giving them
operational flexibility to meet short-term peak electricity demands.
The electricity sector’s demand for natural gas has increased from 24 percent of total natural gas consumption in 2000 to 29
percent in 2005.59 And consumption of natural gas is likely to increase even further for two reasons:
Lower Reserve Margins
First, increased electricity demand in many areas has shrunk reserve margins to historically low levels. By 2005, reserve
margins across the contiguous United States had dropped to 15 percent and, in some large states (like Texas and Florida), as
low as 9 percent. Shrinking reserve margins coupled with increased electricity demands have forced many utilities to
restart “mothballed” natural gas-fired generating units. And plans for new peaking units in large consumer states like
Texas and Florida rely overwhelmingly on natural gas.60
Prospects for New Sources
Second, because U.S. utilities have over-invested in gas-fired generating units, they hunger for new supplies of natural gas.
Congress responded recently by authorizing greater drilling rights in the Gulf of Mexico and has hinted at granting greater
access to federal lands where natural gas drilling is currently off-limits.61 Whether new drilling rights are granted or not,
the tantalizing prospect of vast new sources of natural gas may lead utilities to believe that gas-fired units are safer
investments than they really are.
Future Carbon Controls
Third, as pressure builds for the United States to adopt some form of binding greenhouse gas reduction targets, more
generators will turn to natural gas because its carbon intensity is about half that of coal.62
Roger Garrett, Director of Puget Sound Energy’s Resource Acquisition Group, for example, recently told industry
executives that PSE had plans to invest in a significant number of new natural-gas fired combined cycle facilities partly
because the company anticipates future binding carbon constraints.63
In its most recent energy outlook (AEO 2007), EIA projects natural gas wellhead prices to average $5.06 per million cubic
feet (2002$) from 2007 to 2030. If there are delays in the construction of the nearly 45,000 miles of new gas pipelines that
industry analysts say are required to ensure adequate supply, the base-case price grows to $6.43 per million cubic feet.64
Since 1997, however, the U.S. Department of Energy’s Energy Information Administration (EIA) has had to increase its
projections for natural gas prices each year to conform to new data showing that the price was higher than expected.65
The year 2007 was no exception. In its report on short-term energy and summer 2007 fuels outlook, the DOE said it
expected natural gas prices over the summer season to be 18 percent above its predictions a year earlier.66
While natural gas has enjoyed a recent period of depressed prices, substantial long-term price increases are virtually
inevitable.
Recent evidence suggests that EIA’s long-term projections – as in its short-term forecasts – make optimistic assumptions
about growth in domestic natural gas production. In October 2006, for example, Chesapeake Energy stunned the gas
industry by announcing that it would shut off 100,000 cubic feet per day of unhedged gas production until natural gas prices
rebounded. A week later, Questar Exploration & Production curtailed its output for the same reason.67 These unusual
moves repudiated government (and industry) optimism about domestic natural gas output and reminded analysts that the
gas market can be far more volatile and easily manipulated than forecasts predict. As early as 2003, then Federal Reserve
Chairman Alan Greenspan predicted continued strain in the long-term market for natural gas:
Today’s tight natural gas markets have been a long time in coming, and futures prices suggest that we are not apt to return
to earlier periods of relative abundance and low prices anytime soon.68
ENDI 08 6
RPS aff
Moreover, two articles last year in Public Utilities Fortnightly that addressed natural gas supply, demand, and price issues
seemed to confuse the solution with the problem. Robert Linden noted that high gas prices would lead to "demand
destruction" in the industrial sector, which would, in part, counterbalance increasing power sector demand. n17 He further
stated, "This price-induced demand destruction can be added to the other causes of reduced gas demand, including the
closure of industrial facilities using natural gas as a feedstock." n18 Similarly, John Herbert, after noting that high natural
gas prices have forced U.S. fertilizer plants to shut down, stated, "As fertilizer and other chemical plants continue to shut
down, this will reduce demand for natural gas and increase overall supplies." n19
Both authors are correct in pointing out that high natural gas prices will tend to reduce industrial natural gas demand as
industrial plants shut down, and that this will temper future natural gas price increases. However, the "destruction" of the
nation's industrial sector is an extremely serious problem for the United States; it is not a "solution" to the natural-gas
pricing problem. We should be very concerned with the strongly negative impact high natural gas prices are having on the
U.S. industrial sector and the potential implications of this for the U.S. economy.
Despite all of the hype in recent years about the new economy, the information economy, the service economy, etc.,
manufacturing is, by far, the most critical sector of the U.S. economy, and it creates the broad foundation upon which the
rest of the economy grows. n20 Manufacturing drives the rest of the economy, provides a disproportionate share of the
nation's tax base, generates innovation, and disseminates new technology throughout the economy. The average
manufacturing job creates 4.2 jobs directly and indirectly throughout the economy, whereas the average service and retail
job generates about one other job, directly and indirectly.
The manufacturing sector uses 40 percent of the natural gas consumed in the United States, and virtually every
manufacturing industry is heavily dependent on natural gas as a fuel, feedstock, and, increasingly, as a source of electricity
generation. Price spikes in the cost of natural gas and electricity in the fall of 2000 precipitated the current manufacturing
recession. During the past three years, this sector has been severely affected, losing more than 2.5 million jobs. n21 The
current manufacturing recovery is slower than the first year of any recovery in 40 years. n22 Manufacturing is suffering
from intense global competition and cannot pass though increased energy costs via product price increases.
Reliance on low-cost natural gas has been an often-unrecognized factor in the U.S. manufacturing sector's global
competitiveness, and an ample supply of reasonably priced natural gas is critical to its competitiveness. This sector is
bearing the brunt of the energy impacts of the natural gas crisis and is suffering from a triple whammy: High natural gas
prices are causing industrial electricity prices to increase, the cost of natural gas as a feedstock and fuel is greatly increasing
manufacturing costs, and industrial operations are the first to be cut off from natural gas supplies when winter emergencies
occur. The natural gas crisis has become a matter of exporting profits and jobs to countries with cheaper natural gas.
Thus, the impact of high natural gas prices is, indeed, to destroy the U.S. industrial sector. However, instead of viewing this as an effect that will serve to
moderate future natural gas price increases, this must be viewed as a very serious problem resulting from high natural gas prices. To the extent natural gas
demand and prices are being driven by the increasing use of gas for electric power generation, the solution should be to substitute other fuels, such as
nuclear and coal in this sector, and not to accept demand destruction in the nation's industrial sector.
The case against natural gas for electricity generation is quite clear. Specifically:
. The use of gas for electricity generation is forecast to more than double by 2025, and, according to both EIA and industry analysts, this demand
increase may not be achievable. Natural gas imports are forecast to increase dramatically over the next two decades and, at a time when we are concerned
about the nation's increasing dependence on imported oil, America is becoming increasingly dependent on imported natural gas from the same politically
unstable regions that contain most of the world's oil supplies.
. The increasing use of gas for electric power generation is placing strains on natural gas supplies and the gas transmission and distribution
infrastructure, and this will further hinder the provision of adequate gas supplies.
. This increasing use is causing the price of natural gas to increase and to become more volatile. Increased prices and
price volatility are having adverse consequences for natural gas consumers and are resulting in market disruptions. Gas
price volatility will likely increase in the future, thus causing further market disruptions
. Natural gas shortages and price volatility can have adverse economic and employment effects, and they can increase
U.S. dependence on imported oil.
. High natural gas prices are having a devastating impact on U.S. manufacturing industries, and this should be viewed as
the most serious effect of the current (and future) gas crisis.
ENDI 08 7
RPS aff
Nitrogen is an essential nutrient for plant growth. The United States needs reliable and plentiful supplies of natural gas to
produce nitrogen and meet critical agriculture and food production needs. Natural gas is the fundamental feedstock
ingredient for the production of nitrogen fertilizer and represents nearly 90 percent of the production cost of one ton of
anhydrous ammonia, which is the building block for most other forms of commercial nitrogen plant nutrients.
The nitrogen industry accounts for nearly 2 percent of the total natural gas consumed in this nation. Since 2000, the U.S.
nitrogen industry has permanently closed 26 nitrogen production facilities, due primarily to high natural gas prices.
Currently, only 30 nitrogen plants are operating in the United States and 55 percent of the U.S. farmers' nitrogen fertilizer is
imported. In less than 10 years, we went from basically being self-sufficient in nitrogen fertilizer to importing more than
half of our needs.
America's food security, and by extension our national security, will be jeopardized if action is not taken to address our
country's current natural gas crisis.
According to the May 1st, 2008 GAO study entitled, "Implications of Switching from Coal to Natural Gas", U.S. natural
gas production peaked in 1973 and the average productivity of our wells has declined for the past 35 years - due to
diminishing output of older wells and lower yields and depletion rates. The EIA projects that natural gas production will not
increase in the lower 48 states over the next 20 years. And according to the GAO, the U.S. has already found and used its
easily recoverable natural gas and finding new gas requires deeper drilling in more inaccessible locations.
It is increasingly difficult to keep output constant, because about one-third of our production has to be replaced every year.
Thus, the U.S. has limited capacity to meet growing demand for gas with domestic production. Consequently, widespread
fuel switching at electricity generating units would increase demand for natural gas beyond the capabilities of existing and
projected supply. The U.S. would require nearly twice as much gas supply by 2030, as projected by EIA, if the U.S. were to
replace all coal-fired power plants with natural gas.
The ongoing U.S. natural gas crisis, which really began in the winter of 1999-2000, has evolved into a domestic and global
energy and food supply crisis. Fertilizers are currently responsible for 40 percent of the world's food supply and are a
necessary part of solving today's global food crisis.
“Many Americans see terrorism as the principal threat to security,” said Brown, “but for much of humanity, the effect of
water shortages and rising temperatures on food security are far more important issues. For the 3 billion people who live on
2 dollars a day or less and who spend up to 70 percent of their income on food, even a modest rise in food prices can
quickly become life-threatening. For them, it is the next meal that is the overriding concern.”
ENDI 08 8
RPS aff
The failure to compete in the renewable market will cripple U.S. economic and technological leadership
Hendricks, 4 – Executive Director of the Apollo Alliance
(Bracken, FDCH Congressional Testimony, Subcommittee on Energy and Mineral Resources Committee on House
Resources, “Rising Price of Natural Gas,” 2-12-2004, Lexis-Nexis Universe)
U.S. competitiveness is key to hegemony; a loss of our edge will cause isolationism.
Khalilzad, RAND Corporation, 1995 [Zalmay, “Losing the Moment?” The Washington Quarterly, Spring, l/n]
The United States is unlikely to preserve its military and technological dominance if the U.S. economy declines seriously.
In such an environment, the domestic economic and political base for global leadership would diminish and the United
States would probably incrementally withdraw from the world, become inward-looking, and abandon more and more of its
external interests. As the United States weakened, others would try to fill the Vacuum. To sustain and improve its economic
strength, the United States must maintain its technological lead in the economic realm. Its success will depend on the choices it
makes. In the past, developments such as the agricultural and industrial revolutions produced fundamental changes positively affecting the relative
position of those who were able to take advantage of them and negatively affecting those who did not. Some argue that the world may be at the beginning
of another such transformation, which will shift the sources of wealth and the relative position of classes and nations. If the United States fails to
recognize the change and adapt its institutions, its relative position will necessarily worsen. To remain the preponderant world
power, U.S. economic strength must be enhanced by further improvements in productivity, thus increasing real per capita income; by
strengthening education and training; and by generating and using superior science and technology. In the long run the economic future of
the United States will also be affected by two other factors. One is the imbalance between government revenues and government expenditure. As a society
the United States has to decide what part of the GNP it wishes the government to control and adjust expenditures and taxation accordingly. The second,
which is even more important to U.S. economic wall-being over the long run, may be the overall rate of investment. Although their government cannot
endow Americans with a Japanese-style propensity to save, it can use tax policy to raise the savings rate.
Under the third option, the United States would seek to retain global leadership and to preclude the rise of a global rival or a
return to multipolarity for the indefinite future. On balance, this is the best long-term guiding principle and vision. Such a vision is desirable not as an end
in itself, but because a world in which the United States exercises leadership would have tremendous advantages. First, the
global environment would be more open and more receptive to American values -- democracy, free markets, and the rule of
law. Second, such a world would have a better chance of dealing cooperatively with the world's major problems, such as
nuclear proliferation, threats of regional hegemony by renegade states, and low-level conflicts. Finally, U.S. leadership
would help preclude the rise of another hostile global rival, enabling the United States and the world to avoid another
global cold or hot war and all the attendant dangers, including a global nuclear exchange. U.S. leadership would
therefore be more conducive to global stability than a bipolar or a multipolar balance of power system.
ENDI 08 11
RPS aff
U.S. transmission capacity is too low to accommodate demand – it increases the risk of blackouts
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
The 2003 blackout prompted calls for up to $100 billion in new transmission investments to prevent bottlenecks and relieve
strained power lines. But investment continues to lag woefully. While electricity demand is forecast to grow by 20 percent
between 1998 and 2008, transmission capacity is set to grow by only 5 percent.118 As a result, congestion expenses in
some areas costs more than $1 billion each year. 119
Some analysts estimate that just to maintain the current ratio of available transmission capacity per MW of electricity
demand will require the construction of 26,600 miles of new transmission over the next decade. Compare this staggering
figure with estimated planned construction of only 6,200 miles and the investment shortfall becomes almost stupefying.120
According to an informal association of electric utilities in 35 states, maintaining transmission adequacy at year 2000 levels
will require quadrupling planned expenditures to $56 billion by 2011 (in 2004 dollars).121 Ensuring increased reliability
will require even more investment.
As consumers demand more electricity than the system can deliver, U.S. ratepayers could soon face serious congestion-
driven rate increases. The National Electric Reliability Council (NERC) warns that grid congestion will continue to
increase and in some situations “lead to supply shortages and involuntary customer interruptions.”122
There is a growing consensus that federal leadership is needed to address an impending electricity transmission crisis.
Citing NERC concerns that increased volumes of power flowing across the transmission system could overwhelm bulk
transmission capacity, FERC proposed transmission pricing reforms in 2006 designed to encourage utility investments in
the nation’s transmission infrastructure.123
In testimony before the House Government Reform Subcommittee on Energy and Resources, FERC Chairman Pat Wood
defended the proposed federal intervention, noting that market-driven transmission investment “was not keeping up with
load growth, and that “in every area of the country” FERC needed to “accelerate investment in transmission
infrastructure.”124
B. Utilities Benefit from Congestion
Like prisons, transmission lines would almost certainly be inadequately funded if left to individual market participants.
Under normal market conditions, some utilities benefit from limited transmission resources. When the transmission system
is saturated, less supply is available to meet existing demand, and prices increase. Market forces create perverse incentives
for some utilities to delay transmission upgrades unless or until they risk catastrophic system failure. Even FERC has
observed:
Market participants also complain that companies that own both transmission and generation under-invest in transmission
because the resulting competitive entry often decreases the value of their generation assets.125
Market dynamics can create situations where congestion prices benefit some electricity generators at the expense of
customers, who not only pay higher prices, but suffer costs from the increased risk of blackouts. 126
ENDI 08 13
RPS aff
At that moment in time, no one knew how long the blackout would last, what caused it, whether it was terrorist induced or accidental
failure and how widespread it would be. In the end, Bush would learn it was the largest electric blackout ever. Though apparently not
caused by terrorism, in the span of just nine seconds 50 million people in New York City and state, New England,
Detroit, Cleveland, Ottawa and Toronto would lose electric power, placing them in the hot, often waterless
darkness. Thousands would have to walk home; thousands would be trapped underground in subways, suspended in inoperable
elevators, or at schools and theaters. But very quickly in the past two days Bush and his energy team found that some
very tricky issues were posed by the blackout that will not be easily answered. The crisis over power in the United
States may not be temporarily as devastating as Baghdad's, but in the long run the very nature of U.S. economic and social
survival may rely upon correcting the difficulties.
But what if it can't? What if the global economy stagnates - or even shrinks? In that case, we will face a new period of
international conflict: South against North, rich against poor. Russia, China, India - these countries with their billions of
people and their nuclear weapons will pose a much greater danger to world order than Germany and Japan did in the '30s.
A federal RPS creates incentives for transmissions upgrades – it decreases public opposition and allows utilities to
recover costs faster
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Creating incentives for utilities to invest in much needed transmission system upgrades actually may be one of the
hidden benefits of a national RPS.
Utilities can overcome public opposition to new transmission infrastructure by arguing for the need to access renewable
resources. While public reaction to renewable energy is far from uniform, using access to renewable resources as a
justification for new transmission wins local support for projects and speeds their development.
In addition, because renewable energy technologies have much shorter lead-times than conventional power plants, utilities
can start getting use out of new power lines even as they wait to bring large conventional projects online. Quicker use of
new transmission capacity benefits ratepayers because new rules allow utilities to start recovering the full cost of
transmission investments even before utilities have built new capacity to fill them.
ENDI 08 14
RPS aff
Increasing electricity demand will rapidly accelerate water shortages in the U.S. – only a federal RPS can solve
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
B. Water Conservation
If projected electricity demand is met using water-intensive fossil fuel and nuclear reactors, America will soon be
withdrawing more water for electricity production than for farming. Perhaps the most important—and least discussed
—advantage to a federal RPS is its ability to displace electricity generation that is extremely water-intensive. The nation’s
oil, coal, natural gas, and nuclear facilities consume about 3.3 billion gallons of water each day.244 In 2006, they
accounted for almost 40 percent of all freshwater withdrawals (water diverted or withdrawn from a surface- or ground-
water source), roughly equivalent to all the water withdrawals for irrigated agriculture in the entire United States.245
A conventional 500 MW coal plant, for instance, consumes around 7,000 gallons of water per minute, or the equivalent of
17 Olympic-sized swimming pools every day.246 Older, less efficient plants can be much worse. In Georgia, the 3,400
MW Sherer coal facility consumes as much as 9,913 gallons of water for every MWh of electricity it generates. 247 Data
from the Electric Power Research Institute (EPRI) also confirms that every type of traditional power plant consumes and
withdraws vast amounts of water. Conventional power plants use thousands of gallons of water for the condensing portion
of their thermodynamic cycle. Coal plants also use water to clean and process fuel, and all traditional plants lose water
through evaporative loss. Newer technologies, while they withdraw less water, actually consume more. Advanced power
plant systems that rely on re-circulating, closed-loop cooling technology convert more water to steam that is vented to the
atmosphere. Closed-loop systems also rely on greater amounts of water for cleaning and therefore return less water to the
original source. Thus, while modern power plants may reduce water withdrawals by up to 10 percent, they contribute even
more to the nation’s water scarcity.248
Nuclear reactors, in particular, require massive supplies of water to cool reactor cores and spent nuclear fuel rods. Because
much of the water is turned to steam, substantial amounts are lost to the local water table entirely. One nuclear plant in
Georgia, for example, withdraws an average of 57 million gallons every day from the Altamaha River, but actually
“consumes” (primarily as lost water vapor) 33 million gallons per day from the local supply, enough to service more than
196,000 Georgia homes,.249
With electricity demand expected to grow by approximately 50 percent in the next 25 years, continuing to rely on fossil
fuel-fired and nuclear generators could spark a water scarcity crisis. In 2006, the Department of Energy warned that
consumption of water for electricity production could more than double by 2030, to 7.3 billion gallons per day, if new
power plants continue to be built with evaporative cooling. This staggering amount is equal to the entire country’s water
consumption in 1995.250
ENDI 08 15
RPS aff
The Argonne National Laboratory has documented how power plants have withdrawn hundreds of millions of gallons of
water each day for cooling purposes and then discharged the heated water back to the same or a nearby water body. This
process of “once-through” cooling presents potential environmental impacts by impinging aquatic organisms in intake
screens and by affecting aquatic ecosystems by discharge effluent that is far hotter than the surrounding surface waters.259
Drawing water into a plant often kills fish and other aquatic organisms, and the extensive array of cooling towers, ponds,
and underwater vents used by most plants have been documented to severely damage riparian environments.
In some cases, the thermal pollution from centralized power plants can induce eutrophication—a process where the warmer
temperature alters the chemical composition of the water, resulting in a rapid increase of nutrients such as nitrogen and
phosphorous. Rather than improving the ecosystem, such alterations usually promote excessive plant growth and decay,
favoring certain weedy species over others and severely reducing water quality. In riparian environments, the enhanced
growth of choking vegetation can collapse entire ecosystems. This form of thermal pollution has been known to decrease
the aesthetic and recreational value of rivers, lakes, and estuaries and complicate drinking water treatment.260
ENDI 08 16
RPS aff
Air pollution from conventional energy kills 50,000 people a year – an RPS solves
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
C. Air Quality
Conventional electricity generation is by far the largest source of air pollutants that harm human health and contribute to
global warming. In 2003, for example, fossil fuel use (for all energy sectors, not just electricity) was responsible for 99
percent of the country’s carbon dioxide (CO2) emissions, 93 percent of its sulfur dioxide (SOx) emissions, and 96 percent
of its nitrous oxides emissions (NOx).269
Researchers at the Harvard School of Public Health estimated that the air pollution from conventional energy
sources kills between 50,000 and 70,000 Americans every year.
These researchers found that the emissions from just 9 power plants in Illinois directly contributed to an annual risk of 300
premature deaths, 14,000 asthma attacks, and more than 400,000 daily incidents of upper respiratory symptoms among the
33 million people living within 250 miles of the plants.271
Compiling data from the American Cancer Society, Harvard School of Public Health, and Environmental Protection
Agency, the Clean the Air Grassroots Network estimated that residents in every single U.S. state were at risk to premature
death from air pollution. 272
Children are particularly vulnerable to the pollution from fossil fuels. Because children spend more time outside and have
smaller airways that necessitate more rapid breathing, they are much more vulnerable to develop illnesses associated with
air pollution.273
By promoting technologies that displace conventional forms of electricity generation, a national RPS would substantially
decrease air pollution in the U.S. A single 1 MW wind turbine running at only 30 percent of capacity for one year displaces
more than 1,500 tons of carbon dioxide, 2.5 tons of sulfur dioxide 3.2 tons of nitrous oxides, and 60 pounds of toxic
mercury (Hg) emissions.274
One study assessing the environmental potential of a 580 MW wind farm located on the Altamont Pass near San Francisco,
California, concluded that the turbines displaced hundreds of thousands of tons of air pollutants each year that would have
otherwise resulted from fossil fuel combustion. 275
The study estimated that the wind farm would displace more than 24 billion pounds of nitrous oxides, sulfur dioxides,
particulate matter and carbon dioxide over the course of its 20-year lifetime — enough to cover the entire city of Oakland
in a pile of toxic pollution 40 stories high.276
Air pollution can make life unsustainable by harming the ecosystem upon which all life depends and harming the health of
both future and present generations. The Rio Declaration articulates six key principles that are relevant to air pollution.
These principles can also be understood as goals, because they describe a state of affairs [*27] that is worth achieving.
Agenda 21, in turn, states a program of action for realizing those goals. Between them, they aid understanding of
sustainable development's meaning for air quality.
The first principle is that "human beings. . . are entitled to a healthy and productive life in harmony with nature", because
they are "at the center of concerns for sustainable development." n3 While the Rio Declaration refers to human health, its
reference to life "in harmony with nature" also reflects a concern about the natural environment. n4 Since air pollution
damages both human health and the environment, air quality implicates both of these concerns. n5
ENDI 08 18
RPS aff
In response, American states and cities as well as countries around the world and a growing por-tion of the private sector
are taking action to re-duce their respective greenhouse gas emissions (GHGs) while simultaneously calling for greater
commitments on the part of the U.S. govern-ment and other major rising emitters like China and India. Both the U.S.
government and indus- try are increasingly responding to these trends.
In the past year, there has been increasing aware- ness of how countries and companies view their own energy production
and use, as well as their environmental footprint. For instance, a July 2007 study by the National Petroleum Council
(NPC), which represents the major oil and gas industry perspective, was entitled Hard Truths: Facing the Hard Truths
about Energy and stressed the impor- tance of energy efficiency and the development of alternative fuels as part of a
multi-component approach. New innovation on energy and climate is being spurred by state and local regulations and
company anticipation of government regu- lation on a national level.
Many companies are delaying investment in a va-riety of energy infrastructure projects, however, particularly in the power
generation sector. This is because of uncertainty over the sustained trac-tion of climate policies emerging at the state and
local level and questions of whether and how soon affordable technology for providing low-carbon alternatives will come
online. Companies also are uncertain over the cost and regulatory approach associated with implementing carbon
constraints, as well as the risk of the emergence of future constraints. This delay in investment in infrastructure
undermines the reliability of our current energy supply.
A world operating on differing sets of rules or costs associated with carbon dioxide emissions could have disruptive
implications for trade, energy security, competitiveness, and economic growth. A world, however, that establishes a
global consensus on the cost of carbon could breathe life into new and emerging sectors of the economy, provide new
avenues for U.S. eco-nomic growth, and provide a platform for U.S. global leadership on a major issue of concern to the
global economy.
U.S. leadership to shape a new energy frame-work in a carbon-constrained world offers a unique opportunity to alter the
geopolitics of energy, improve energy security, reinvigorate the spirit of innovation and entrepreneurialism, and engage
disenfranchised portions of the de-veloping world.
ENDI 08 19
RPS aff
A minimum standard of 20% renewables by 2020 that is technology-neutral is the most effective way to spur
renewables investment without burdening the utilities industry
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor of Government and
International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC), a national non- profit organization committed to
reforming U.S. energy policy (Benjamin and Chris, Renewing America: The Case for Federal Leadership on a National Renewable Portfolio Standard
(RPS), June, http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Lesson 1: The RPS target must be large enough to create economies of scale, but phased in gradually to protect utilities.
To bring the benefits of renewable energy to most consumers, a national RPS must set a target large enough to achieve economies of scale in manufacturing. Economic models have
found significant benefits from a 20 percent by 2020 mandate, for example.
If the target is not set large enough, it may fail to promote renewable energy technologies at all. The clearest example of a state RPS that has
failed to produce new renewable energy is Maine. The Maine legislature passed an RPS that took effect in March, 2000, setting an immediate and seemingly large target of 30 (and including large
hydroelectric facilities as an eligible resource). However, existing hydroelectric, biomass, and landfill gas generators in the state were already exceeding the standard.356
NREL analysts concluded that Maine’s RPS, “has failed to lead to any new renewable resources, and has failed to generate significant revenues above commodity electricity market prices.”357 Even the
Maine Public Utilities Commission admitted that “the experience to date, however, reveals that the current portfolio requirement is not satisfying the Restructuring Act’s stated policy of encouraging the
promotion of new renewable energy resources.”358
In contrast, Nevada’s RPS set the target level above the state’s existing level of renewable generation, creating an incentive for utilities to expand their deployment of renewable technologies. The state
passed one of the more aggressive RPS statutes in 2001, requiring that load serving entities provide 5 percent of their electricity from renewable resources in 2003, but increase renewable generation to15
percent by 2013. Sierra Pacific and Nevada Power held their first solicitation for renewable energy in late 2001 and received 49 bids at very competitive prices for 4,300 MW of eligible power (including
3,000 MW of wind, 385 MW of solar, and 784 MW of geothermal). By making its targets large enough, the statute successfully promoted new renewable energy development. Most recently, for instance,
Nevada Power signed a 17 year power purchase agreement to build an 85.5 MW wind site to contribute renewable energy toward its state RPS mandate.359
Gradual yet specific benchmarks—such as 6 percent by
Another key feature of successful state RPS statutes is that they set gradual benchmarks towards reaching the final target.
give transmission and system
2008; 7 percent by 2009; 9 percent by 2012; 14 percent by 2015; 17 percent by 2018; 20 percent by 2020; 23 percent by 2023; and 25 percent by 2025—
operators time to adjust and implement programs to ensure system reliability.
The initial target size should also be set at slightly below the level of existing capacity for the first year, giving suppliers time to arrange contracts. For example, if a national standard were to include
hydroelectric facilities, it could set the standard at 6 percent for 2008, since the country already provides slightly more than 6 percent of its capacity using renewable energy which includes hydroelectric.
RPS targets that step-up deployment percentages gradually would give power providers time to inventory their resources
and adjust their system management.
Furthermore, by increasing the amount of renewable energy slowly over time, the standard ensures that the renewable energy market will result in
competition, efficiency and innovation that will deliver renewable energy at the lowest possible cost. A gradual phase-in
provides time to set up standards for credit certification, monitoring, and compliance. It creates relative certainty and stability in the renewables
market by enabling long term contracts and financing for the renewable power industry, in turn lowering costs. And it gives utilities and generation companies an incentive to drive down the cost of
renewables to reduce their RPS compliance costs.360
California provides an excellent example of how a gradual-phase in makes an RPS more effective. When California implemented their RPS in 2002, they required investor-owned utilities, energy service
providers, and community choice aggregators to meet 20 percent of their electricity load with renewable resources by 2017. But to reach the target, the California RPS also obligated each utility to increase
the percentage of its load with renewable energy by 1 percent each year.
The gradual phase-in clearly worked. The state’s three major investor-owned utilities have increased their purchase of renewable energy from 19,190 GWh in 2002 to 23,110 GWh in 2005. From 2002 to
2005, Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric have each increased the percentage of their load served by renewable energy by approximately 1 percent, 1.5
percent, and 4.5 percent (respectively). In 2003, the state boasted more than 1,900 MW of wind and 600 MW of biomass, largely induced by phase-in targets set to meet the state’s aggressive RPS goal.
In total, approximately 1,452 to 2,789 MW of new renewable energy capacity are already approved or awaiting approval, with more to come.361
Lesson 2: Definitions of eligible renewable resources must be clear, consistent, and comprehensive
A national RPS should include all renewable resources and discriminate against none. The definition of eligible renewable
resources could be based on the renewable aspects of the fuels used rather than any particular technologies deployed. For
instance, eligible resources could be defined as:
Any electrical generator that creates electricity from sunlight, wind, falling water, renewable plant or animal material,
and/or natural geothermal sources.
A fuel-based definition does not rely on policymakers to determine the forms of technology that should receive market
preference and does not require policymakers to continuously revise the mandate to include new technology that may be developed.
By including both new and existing generators as eligible resources, a national RPS would avoid bitter debates concerning whether certain “upgrades” to existing systems make them “new,” as with the
feud over New Source Review under the Clean Air Act. Gradual benchmarks ensure that new renewable generation is developed without having to distinguish between “existing” and “new” renewable
energy systems. Avoiding this debate reduces administrative complexity and frees generators from continuously monitoring regulatory rulings to determine whether a particular expenditure will be
considered maintenance and refurbishment of an existing facility or a new investment that qualifies toward the RPS mandate.
A fuel-based definition of eligible resources would include large hydroelectric facilities. The construction of new hydroelectric facilities and incremental improvements to existing ones could help utilities
to use renewable resources to provide base-load power. Including incremental hydropower also allows areas like the Southeast and the Pacific Northwest to benefit from their regions’ substantial sources of
existing clean energy.
And, finally, a fuel-based definition of eligible resources would ensure that truly renewable resources attain a greater proportion of the nation’s electricity fuel portfolio. While alternative technologies such
as non-renewable distributed generation, clean coal with carbon capture and storage, and energy efficiency should be encouraged, there are strong market-based reasons that they should not be directly
included in an RPS. Such sources would neither diversify energy resources nor achieve the economic benefits of a vibrant renewable energy sector. Renewables should compete with other renewables,
just as clean coal should compete with dirty coal and light water reactors with advanced nuclear generators. Healthy market-based competition ensures that the best mechanisms for utilizing each fuel
source are supported.
Lesson 3: A national RPS should apply to electricity demand, not installed capacity
Rather than mandate a fixed amount of renewable capacity, a national RPS should require utilities to meet a percentage of
electricity demand through renewable resources. A demand-based mandate ensures that suppliers are concerned more with
the actual delivery of electricity than the construction of renewable energy systems that may never produce a watt of
energy actually sent to consumers.
ENDI 08 20
RPS aff
Americans today are no less clever or ambitious than their greatgrandparents were. A new and better energy future is
possible if the country can forge a compelling vision of
where it wants to be. Recent developments in the global marketplace show the potential:
•Global wind energy generation has more than tripled since 2000, providing enough electricity to power the homes of about
30 million Americans. The United States led the world in wind energy installations in 2005.
•Production of electricitygenerating solar cells is one of the world’s fastest growing industries, up 45 percent in 2005 to six
times the level in 2000.
•Production of fuel ethanol from crops more than doubled between 2000 and 2005, and biodiesel from vegetable oil and
waste expanded nearly fourfold over this period.
Global investment in renewable energy (excluding large hydropower) in 2005 is estimated at $38 billion—equivalent to
nearly 20 percent of total annual investment in the electric power sector . Renewable energy investments have nearly
doubled over the past three years, and have increased sixfold since 1995.
Next to the Internet, new energy technology
has become one of the hottest investment fields for venture capitalists .
These dynamic growth rates are driving down costs and spurring rapid advances in technologies . They are also creating
new economic opportunities for people around the globe. Today, renewable energy manufacturing, operations, and
maintenance provide approximately two million jobs worldwide.
The United States will need a much
stronger commitment to renewable energy if it is to take advantage of these
opportunities. As President Bush has said, America is “addicted to oil,” and dependence on fossil fuels is rising, even in the
face of high oil prices and growing concern about global warming. Of particular concern is the well over 100 coalfired
power plants now on the drawing boards of the U.S. electricity industry—most of which lack the latest pollution controls
and could still be pumping carbon dioxide into the atmosphere a halfcentury from now.
In order to break the national addiction to outdated fuels and technologies, America will need a worldclass energy policy.
The prominent positions that Germany and Spain hold in wind power , for example, and that Japan
and Germany enjoy in solar energy, were achieved thanks to strong and enduring policies that their legislatures adopted in
the 1990s. These policies created steadily growing
markets for renewable energy technologies, fueling the development of
robust new manufacturing industries.
By contrast, U.S. renewable energy policies over the past two decades have been an everchanging patchwork . Abrupt
changes in direction at both the state and federal levels have deterred investors and led dozens of companies into
bankruptcy. If America is to join the
world leaders and achieve the nation’s full potential for renewable energy, it will need
worldclass energy policies based on a sustained and consistent policy framework at the local,state,and national levels.
Across the country, the tide has begun to
turn. All but four U.S.states now have incentives in place to promote renewable
energy. More than a dozen have enacted new renewable energy laws in the past few years, and four states strengthened
their targets in 2005,signaling fresh political momentum. If such policies continue to proliferate, and are joined by federal
leadership, rapid progress is possible.
ENDI 08 21
RPS aff
Given such obvious and overwhelming advantages, it is hard to believe that many utilities and policymakers diligently oppose a federal RPS mandate, repeating myths that have long since been debunked.
Largely, the remaining objections to federal intervention constitute a (diminishing) series of canards that mischaracterize a
national RPS policy as an unnecessary federal intervention in a relatively free market. Forgetting that a majority of states
are well on their way to imposing their own clunky, overlapping, inconsistent, competing and sometimes irrational mess
of mandates, opponents of a national RPS wheel out these war-torn myths every time the issue is considered:
Myth #1: A national RPS would create “winners and losers”
Truth: All states have renewable resources they can affordably develop. However, under the current system of state
mandates, some RPS states are “losers” by subsidizing the cheap, polluting electricity in non-RPS states. Other RPS states
are victims to inconsistencies between state mandates that produce perverse predatory trade-offs and require them to export
their cheap in-state renewable electricity to other states in exchange for more expensive electricity or renewable energy
credits. A national mandate would level the playing field by creating consistent, uniform rules and by allowing utilities to
purchase RECs or develop renewable resources anywhere they are cost competitive.
Myth #2: A national RPS would increase electricity rates
Truth: In most states, RPS mandates have not significantly increased rates and a consensus of economic models predict
that a national policy would generate substantial consumer savings over even the existing patchwork of state programs. By
expanding the amount of energy that would offset gas-fired generation, a national RPS would reduce demand on a strained and volatile natural gas market. Renewable energy units with
markedly faster lead-times than conventional and nuclear reactors speeds the cost recovery of critical transmission
investments and reduces the rate increases needed to pay for new transmission.
Myth #3: A national RPS would cost the electricity sector
Truth: When utilities say a national RPS “costs” the sector, they are usually assuming future profits they will not be able
to recover from consumers through higher electricity rates. For policymakers, balancing utility profits with electricity prices is one of the hard decisions we elect
them to make. However, elected officials should consider that utility claims of lost profit are short-sited (and strategically unsound). In reality, a more predictable RPS
regulatory environment decreases utility litigation and compliance costs relative to a growing web of vague and unstable
state mandates. Expanding the universe of eligible renewable resource and establishing clear, uniform trading rules creates
far more flexibility for regulated utilities and rewards utility investments on the basis of smart market strategy and not
geography. By promoting a robust domestic manufacturing sector, a national RPS reduces the costs utilities pay in
unfavorable exchange rates and foreign parts and labor (and redirects those investments to the U.S. labor market).
Myth #4: A national RPS would only benefit one technology – large wind installations
Truth: Experience from existing state RPS programs proves that mandates with broad eligibility actually have led to the
development of many different renewable resources. Utilities have already demonstrated that they can meet state RPS requirements by deploying a diverse portfolio of
renewable resources that best match their service areas.
A meta-analysis of 25 different RPS studies revealed that each of the states that have already responded to their own
mandates by deploying a diverse array of renewable energy technologies. By expanding (geographically and monetarily) the market for renewable
resources, a national RPS is likely to diversify the deployment of renewable energy technologies even further. In Nevada, geothermal energy may be cheaper to develop than wind. In the Pacific
Northwest, incremental hydro may be cheaper than solar. In the Southeast, biomass may be the most affordable. A national RPS mandate with a fuel-based definition of eligible renewable resources
ensures that free market principles (rather than regulatory set-asides or political patronage) determine which technologies will be most cost competitive in certain areas of the country. An added bonus is
a technology-neutral mandate allows utilities to meet RPS obligations
that a uniform national RPS decreases compliance costs for regulated utilities, since
using the technology that is most cost competitive for the fuels available.
It is time that federal policymakers engage in an informed, comprehensive and rational debate about the few remaining objections to a federal RPS mandate. America faces serious and mounting energy
problems:
- continued dependence on dwindling foreign sources of fossil fuels and uranium
- an undiversified electricity fuel mixture that leaves the nation vulnerable to serious national security threats
- reliance on an ancient and overwhelmed transmission grid that risks more common, more pronounced, and more expensive catastrophic system failures
- an impending climate crisis that will require massive and expensive emissions controls costing billions of dollars and substantially reducing U.S. GDP
- loss of American economic competitiveness as Europe and Japan become the major manufacturing center for new clean energy technologies
By establishing a consistent, national mandate and uniform trading rules, a national RPS can create a more
It is time to decide.
just and more predictable regulatory environment for utilities while jump-starting a robust national renewable energy
technology sector. By offsetting electricity that utilities would otherwise generate with conventional and nuclear power, a national RPS would decrease electricity prices for American
consumers while protecting human health and the environment.
Now is the
There is a time for accepting the quirks and foibles of state experimentation in national energy policy; and there is a time to take look to the states as laboratories for policy innovation.
time to model the best state RPS policies and craft a coherent national policy that protects the interests of regulated utilities
and American consumers.
Now is the time for federal leadership.
ENDI 08 22
RPS aff
The most common method for requiring the use of renewable fuel sources n3 is the imposition of a renewable portfolio
standard (RPS). n4 The U.S. Congress recently considered, until the last moment, n5 legislation that would have [*51]
established a national RPS, which would have required electric utilities to procure a certain percentage of their electricity
from renewable resources or purchase renewable energy credits from other sources to meet the standard. n6 Instead, the
energy bill moved forward, once again, without establishing a national RPS. Twenty-five states and the District of
Columbia already have some form of an RPS in place. n7 Nonetheless, both literally and figuratively, renewable energy is
not going away.
(Footnote 5:)
n5. See Energy Bill Headed to President's Desk After House Passes Stripped-Down Version, Foster's Elec. Rep. No. 537
(Dec. 19, 2007), at 1 ("After Senate Democratic leaders stripped the controversial RPS and tax package provisions from the
bill, the Senate on Dec. 13 approved the revamped version in an 86-8 vote, and sent it back to the House for that body's
approval.").
ENDI 08 23
RPS aff
Today, there exists such widespread consensus on the financial, environmental and security benefits enjoyed by
diversifying our nation’s electricity fuels with clean, renewable resources that 21 states and the District of Columbia have
already passed laws requiring utilities to use more of these resources.5 Seven more states—Florida, Indiana, Louisiana,
Nebraska, Utah, Vermont, and Virginia—are considering mandating some form of RPS.
While most state efforts have been laudable, state RPS statutes have created a patchwork of inconsistent, often conflicting
mandates that distort the market for renewable energy technologies and unintentionally inflate electricity prices. By
subjecting an increasingly interstate electric utility market to confusing and sometimes contradictory state regulations, this
tangle of state-based RPS programs discourages long-term investments and, in some cases, encourages utilities to exploit
the inconsistencies.
The federal government has refused to orchestrate some harmony out of the chaos, despite repeated appeals. Indeed,
Congress has rejected proposals to establish a uniform national RPS 17 times in the last 10 years.
Although a consensus of economic forecasts predict lower electricity prices from a national RPS, the Bush Administration
has officially opposed a federal RPS on the grounds that it would create “winners” and “losers” among regions of the
country and increase electricity prices in places where renewable resources are less abundant or harder to cultivate.6
Utilities have opposed the costs associated with “draconian” federal interventions and advocacy groups like the Union of
Concerned Scientists (UCS) continue to churn out report after report demonstrating that a national RPS would lower
electricity prices and save consumers money.
Which side is right?
The answer is the same as in the Minnesota dispute: Both are.
The cost of a national RPS to regulated utilities may well represent a decrease in future profits that the industry would
otherwise collect from ratepayers.
A national RPS may simply shift cost savings from the electricity sector to ratepayers who would enjoy lower electricity
prices. In contrast, rejecting a national RPS may subject consumers to higher energy costs in order to protect the profits of
the electricity sector.
Policymakers must make a choice.
The vacuum of federal leadership on renewable portfolio standards is not without consequence. Not only does reliance on
state-based action make for an uncertain regulatory environment for potential investors, it creates inherent inequities
between ratepayers in some states that are paying for “free riders” in others. Indeed, the most compelling argument for
federal action may be that a national RPS would help correct many of the market distortions brought about by a patchwork
of inconsistent state actions.
ENDI 08 24
RPS aff
The U.S. Energy Information Administration (EIA) uses one of the most rigorous methodological tools yet invented to
estimate future renewable energy deployment—the National Energy Modeling System (NEMS). NEMS tracks the
geographical differences in regional energy markets at sub-state levels, including specific census divisions and North
American Electric Reliability Council (NERC) sub-regions. NEMS is so rigorous it is used as a benchmark for models
employed by the UCS and the Tellus Institute in their own projections of renewable energy production.
In its 2006 Annual Energy Outlook, the EIA used NEMS to estimate the contribution of renewable fuels to U.S. electricity
supply given existing state-based RPS mandates. According to NEMS, electricity generation from biomass is expected to
increase from 0.9 percent of total generation in 2004 to 1.7 percent in 2030. Wind is forecast to increase from 0.4 percent
to just 1.1 percent of total generation. Geothermal power is projected to increase from 0.4 percent to 0.9 percent. Grid-
connected solar is anticipated to remain at less than 0.1 percent of total generation.20
Taking into consideration the contributions of state-based RPS mandates, EIA’s projection means that non-hydroelectric
renewable energy deployment is expected to rise to no more than about 3 percent by 2015 and 4 percent by 2030.
When broken down by state, EIA projects that 3.7 GW of central-station renewable energy capacity will be added in Texas,
3.4 GW in California, 0.9 GW in Nevada, and 0.5 GW in Minnesota. In Arizona, Colorado, Hawaii, Illinois,
Massachusetts, Maine, Montana, New Mexico, New York, New Jersey, Pennsylvania, Vermont, and Wisconsin, small
projects are projected to increase the production of renewable energy by only 100 to 200 MW in each state.21 Why is the
outlook so bleak for renewable energy in the U.S., especially given the rapid expansion of state-based RPS programs?
EIA notes that poor financing, comparatively higher capital costs for renewable energy, and the need to build or upgrade
transmission capacity from remote resource areas will likely discourage significant investments in renewable energy. EIA
also assumes that the federal production tax credit will expire on December 31, 2007, significantly deterring large-scale
investments in renewable energy generation.
In an early release of its 2007 Annual Energy Outlook, EIA’s updated analysis reflects its earlier pessimism about the future
of renewables:
Despite the rapid growth projected for biofuels and other non-hydroelectric renewable energy sources … oil, coal, and
natural gas still are projected to provide roughly the same 86-percent share of the total U.S. primary energy supply in 2030
that they did in 2005. 22 Mary J. Hutzler, EIA’s Director of the Office of Integrated Analysis and Forecasting, told
Congress a few years earlier that she expects the American energy landscape to continue to be dominated by fossil fuels,
even with the capacity additions induced by state RPS policies. She estimated that, including state-based RPS, renewable
energy technologies would be lucky to achieve more than 5 GW of additional installed capacity by 2010.23 In fact, if state
RPS targets remain at their current levels, Hutzler projects that capacity additions would actually be less than 5 GW
between 2015 and 2020.
ENDI 08 25
RPS aff
As a group, renewables have made little headway despite more stringent environmental regulations and increased public
concern over fossil-fuel generation. n9 Figure 3 shows generation by type of renewable from 1991 through 2005.
Production from wood and waste biomass remained roughly unchanged, as did output from geothermal plants. Figures 4a
and 4b show that the total of these three sources fell from 95.3% to 78.9%, while solar power maintained its 0.6% share.
Had wind generation not risen rapidly, renewable power would be below 2 percent of today's total. The fact that wind is the
only renewable on a growth trend will have important consequences for a national RPS.
Today, renewable resources provide just over 6 percent of total U.S. energy , but that figure could increase rapidly in the
years ahead. Many of the new technologies that harness renewables are, or soon will be, economically competitive
with the fossil fuels that meet 85 percent of U.S. energy needs . With oil prices soaring, the security risks of petroleum
dependence growing, and the environmental costs of today’s fuels becoming more apparent, the country faces com
pelling reasons to put these technologies to use on a large scale.
ENDI 08 26
RPS aff
It is time that federal policymakers engage in an informed, comprehensive and rational debate about the few remaining
objections to a federal RPS mandate. America faces serious and mounting energy problems:
- continued dependence on dwindling foreign sources of fossil fuels and uranium
- an undiversified electricity fuel mixture that leaves the nation vulnerable to serious national security threats
- reliance on an ancient and overwhelmed transmission grid that risks more common, more pronounced, and more
expensive catastrophic system failures
- an impending climate crisis that will require massive and expensive emissions controls costing billions of dollars and
substantially reducing U.S. GDP
- loss of American economic competitiveness as Europe and Japan become the major manufacturing center for new clean
energy technologies
It is time to decide. By establishing a consistent, national mandate and uniform trading rules, a national RPS can create a
more just and more predictable regulatory environment for utilities while jump-starting a robust national renewable energy
technology sector. By offsetting electricity that utilities would otherwise generate with conventional and nuclear power, a
national RPS would decrease electricity prices for American consumers while protecting human health and the
environment.
There is a time for accepting the quirks and foibles of state experimentation in national energy policy; and there is a time to
look to the states as laboratories for policy innovation. Now is the time to model the best state RPS programs and craft a
coherent national policy that protects the interests of regulated utilities and American consumers.
Now is the time for federal leadership.
ENDI 08 27
RPS aff
Because the U.S. does not currently have a national RPS, it also lacks a relatively robust manufacturing base for most
renewable energy technologies. Renewable energy developers in the U.S. largely rely on European or other overseas
manufacturers for the requisite materials (and sometimes expertise and labor) to install renewable energy systems. This
reliance on foreign materials and labor increases construction lead-times as well as shipping costs. It also increases
the likelihood of unexpected delays and shortages.
The fragmented nature of state-based RPS policies actually compounds this problem by creating artificial bottlenecks in the
distribution of materials necessary to deploy renewable energy systems. New state mandates can create unexpected surges
in demand for renewable energy projects, driving up the price of components and labor. Roger Garratt, Director of
Resource Acquisition for Puget Sound Energy, recently remarked that the quick and somewhat unanticipated passage of
Washington’s initiative-driven RPS mandate “created a seller’s market caused by increasing competition for projects and a
shortage of turbine supplies” among wind manufacturers.351
A national RPS would instigate market-based solutions to unexpected material bottlenecks in at least three ways:
First, by providing a stable investment stream and a predictable regulatory environment, investors would have a greater
incentive to establish domestic manufacturing facilities and to rely on local materials and labor.
Second, under a national RPS, American developers would no longer suffer unfavorable exchange rates (given the recent
weakening of the dollar) when purchasing materials. One wind company (Nordex) even estimated that changes in the
exchange rate between Euros and dollars alone cost some American developers as much as $152,000 per project.352
Third, given the certainty of a national market for renewable energy, investors would likely develop better economies of
scale in manufacturing in order to ensure that a sufficient number of materials would exist to satisfy the resulting demand
for renewable energy projects.
ENDI 08 28
RPS aff
A Federal RPS will save utilities and ratepayers more than a patchwork of state mandates.
Comparing the UCS studies of national RPS proposals with LBNL’s analysis of state-based RPS policies suggests that a
national RPS could incur substantially higher cost savings than a patchwork of state-based policies. There are several
reasons that a national mandate is more likely to reduce electricity rates than continued reliance on state-based policies:
B. Lower Costs from Economies of Scale
Technological improvements in thermal efficiency (the amount of raw energy converted to usable electricity), reductions in
manufacturing cost and better construction methods have reduced the cost of renewable technologies consistently over the
past thirty years.46 New wind technologies operate at lower speeds, and newer solar technologies operate with much
improved efficiency.47
In those states that have already adopted more aggressive RPS statutes, the renewable energy industry has responded by
streamlining manufacturing processes and lowering the cost of technology production. For example, in 2005, the
California Energy Commission (CEC) estimated that the average levelized cost (the total cost over the life of a generator
divided by the numbers of kilowatt hours [kWh] produced) of wind energy in California was 3.5 cents per kWh, less than
one-eighth of the price of producing wind energy just 25 years earlier (In 1980, the cost to produce wind in California was
as much as 39 cents per kWh).49
Wind and Landfill Gas Already Beat Fossil Fuels
A similar study conducted by the Virginia Center for Coal and Energy Research (VCCER) found that renewable generators
fueled by wind and landfill gases offered the cheapest forms of electricity—2.8 and 3.0 cents per kWh, respectively—
compared to all other generators including advanced coal, natural gas, and nuclear reactors.50
Yet even VCCER’s cost estimates are artificially high, since capital in a given industry becomes more productive as the
level of cumulative investment increases. The more renewable energy technologies are developed, the cheaper they
become. Experience from RPS states suggests that a national RPS would bring even further reductions in the cost of
manufacturing renewable technologies. Since most renewable technologies are relatively immature, the potential for cost-
savings from “learning” is relatively high.
The Institute of Electrical and Electronics Engineers (IEEE), for example, estimated that a national RPS would bring large
scale development of renewable energy and nationwide standards that would lower costs. Such a “learning by doing”
approach was estimated to lower the expense of producing, installing, and maintaining renewable energy technologies.52
We are already witnessing this “learning effect” with the increased penetration of large wind.
The more turbines that get deployed, the more manufacturers invest in research and development to increase turbine size
and improve performance. For example, in 1980, when the DOE just started developing commercial wind turbines (and
only a few MW were installed), wind energy had a levelized cost of around 81 cents per kWh (in 2000$).53 After more
than 6,000 MW had been installed by 2004, however, the levelized cost dropped sharply to around 5 cents per kWh (and is
projected to decrease further as more turbines are deployed).54
This “learning effect” was confirmed by the Department of Energy’s Office of Energy Efficiency and Renewable Energy
(EERE) projection of significant continued improvements in the competitiveness of wind technology over the next decade.
EERE forecasted cost reductions due to discounts for large-volume purchases of materials, parts and components as well
as from the “learning effects” that flow from deploying wind technology to meet greater cumulative electricity volumes.55
In fact, researchers from Resources for the Future estimate that a 15 percent federal RPS by 2020, could further lower the
construction costs for wind turbines by more than 20 percent and decrease the cost of biomass generators by nearly 60
percent.56
ENDI 08 29
RPS aff
A national RPS would create a national market for renewable energy credits (RECs), n8 which are earned by generating
electricity from qualified renewable generators, such as those using wind, solar, and biomass as their energy source. n9
Covered electricity retailers would be required to hold RECs in the specified proportion to the amount of retail energy they
sold. n10 These RECs could be self-generated or purchased from other qualifying renewable generators. n11
The mere existence of a national RPS would provide some incentive for all utilities to invest in renewable generation
because that investment would have two markets - the market for its electricity and the market for its RECs - instead of just
the market for its electricity for a traditional generation facility. n107 In [*64] addition, it is likely that power projects will
require "more equity, less debt, and shorter debt repayment periods" than in the past. n108 "Developers will probably
attempt to sign bilateral contracts with large end users, marketers, aggregators, and utilities, but contract terms are likely to
be shorter than in the past." n109 In fact, "corporate balance-sheet financing may also become more common." n110 If a
utility buys RECs and energy from another supplier, there is also a risk that purchase agreement would end up showing as a
long-term debt on the utility's balance sheet. n111 Thus, how a national RPS would impact such capital-intensive
investments is hard to predict.
RPS mandates are intended to stimulate a market for renewable resources and spur additional research, development and
implementation of renewable energy technologies. Government intervention helps level the playing field by neutralizing a
legacy of unequal subsidies. Mandating a certain percentage of renewable penetration also helps internalize some of the
environmental costs associated with dirty energy sources and provides a mechanism for early developers of cleaner
resources to recover more of the value of renewable energy technologies. The electricity market benefits as well. RPS
policies create an incentive for retail utilities either to build their own renewable facilities or buy renewable energy credits
(RECs) from other generators.13 As the demand for renewable energy grows, manufacturers gain experience that lowers
the cost of clean electricity production for everyone.
ENDI 08 30
RPS aff
Without federal leadership, consolidated utilities increasingly will find themselves caught in the middle of conflicts
between state commissions.
In January 2007, for example, the Oregon Public Utilities Commission rejected plans by PacifiCorp (a utility serving
customers in multiple states in the Pacific Northwest) to build one coal-fired power plant in Utah by 2012 and another in
Wyoming by 2013. Oregon regulators claimed that the utility had exaggerated projected demand by not properly
considering conservation efforts and renewable resources when calculating future capacity needs. The decision to reject the
plants was heralded by the Oregon Citizens’ Utility Board, a consumer group that argued that Oregon ratepayers should not
have to pay for “Utah’s dirty power.”207 But in Utah, where 95 percent of the state’s electricity is already generated by
coal, the state’s largest electricity consumers strongly supported PacifiCorp’s new plants. So much so that Utah’s
Commissioners accused PacifiCorp of not moving fast enough and warned that delaying the construction of new coal-fired
plants could leave Utah ratepayers exposed to high prices for short-term purchases needed to make up for demand
shortfalls.
The specter of Oregon regulators deciding the fate of electricity generation in Utah and Wyoming highlights an emerging
disconnect between the structure of the U.S. electricity market and the regulations to which it is subject. In the absence of
federal action, U.S. utilities must answer to the whims of state regulators with multiple, often contradictory perspectives on
how and where companies should invest in new generation. Federal leadership in establishing a national RPS would create
uniform regulations on utilities and signal a national commitment to renewable energy generation. By leveling the playing
field between states (and between utilities operating across states) a national RPS protects the interests of ratepayers while
ensuring a level of regulatory predictability that benefits all utilities.
ENDI 08 31
RPS aff
One need not understand all of the intricacies of inter-state REC trading to get the point: the complex, contradictory and
often irrational rules for trading RECs between states and between system operators creates substantial inequalities
between states and impedes potential investors. Two factors are essential for the success of renewable energy
investments: a trusted exchange and a sufficient trading volume. Currently, state and regional REC trading markets lack
both of these elements. Inconsistent and limited REC markets prevent investors from guaranteeing a predictable return on
renewable energy investments. In 2006, Christopher Berendt, who directs clean energy investments for Pace Global
Energy Services, noted that:
While state systems share similarities, there is a critical lack of consistent fungibility between RECs issued in different
states and control areas … Thus, there are no real REC markets among or even within the states, only individual state
regulatory compliance systems. The lack of a real national REC market for state RPS compliance creates an absence of
liquidity for RECs and thus for investment capital as well.92
An expanded interstate renewable energy market established under a national RPS would drive down the costs of RECs
since supply would be pegged to demand organically rather than resulting from inconsistent, artificial geographical
restrictions. By eliminating geographical barriers to REC exchange, a national RPS would provide the necessary market
volume to create predictable rates of return for bulk investors. Standardized trading practices would validate RECs as
fungible currency and be far more cost effective for investors than trying to negotiate discreet investments in small or
regionalized systems. 93
A uniform REC trading market is vital to allowing utilities companies the flexibility to meet an RPS
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Other options exist for those unable to meet the RPS requirement in a given year. That is, retail electric suppliers that are
not able to obtain a sufficient number of RECs are not automatically going to be assessed civil penalties. As a means of
compliance, the Proposed RPS also provides for a "Renewable Energy Credit Borrowing." n179 Under this provision, a
retail electric supplier can submit a compliance plan to the Secretary of Energy demonstrating that sufficient federal RECs
would be earned "within the next 3 calendar years which, when taken into account, will enable the retail electric supplier to
meet the [RPS] requirements ... for calendar year 2012 and the subsequent calendar years involved." n180 Once the plan is
approved, the federal RECs that will be earned under the plan can be applied to meet the RPS requirements each calendar
year involved. n181 Failure to repay any borrowed RECs would subject the retail electric supplier to civil penalties. n182
Oversight and enforcement of the RECs borrowing program, and any resulting proceedings to assess civil penalties, would
also add administrative burdens.
ENDI 08 34
RPS aff
Lesson 5: A national RPS must establish uniform rules for trading renewable energy credits
(RECs)
Absent a REC trading scheme, verifying the compliance of a national RPS would require
tracking all renewable energy transactions within an entire trading region, an enormously
complicated (perhaps impossible) task. Moreover, REC tracking would not follow the actual
delivery of power, since “most states share electricity generation and transmission infrastructure,
and cannot ensure that all of the renewable electricity they use will be generated in state.”364
A national REC trading market would provide utilities immense flexibility in meeting the
standard. To comply with the federal mandate, utilities could either generate their own
renewable electricity, purchase unbundled credits from renewable generators anywhere in the
nation, or import electricity bundled with renewable credits from wherever it is practicable.
Utilities located in areas with poor renewable resources would not be punished because they
have the ability to invest in energy generation in resource-rich areas. A robust REC trading
market also allows credits derived from intermittent technologies such as wind and solar to be
sold at any time, regardless of when the power was generated.365
Massachusetts provides an excellent example of how a vibrant REC trading mechanism is
instrumental to the success of an RPS. In 2004, Massachusetts utilities obligated to meet the
state RPS could only generate 486,000 MWh from qualified renewable resources. 65 percent of
the standard was met by landfill gas generation; 35 percent from biomass; 4 percent from
anaerobic digestion; and around 1 percent from wind. Unexpected delays in the Cape Wind
project in Nantucket Sound, revisions to the state’s definition of eligible biomass, and
uncertainty over the federal production tax credit all unexpectedly hindered renewable energy
development and created an unanticipated shortfall in renewable generation.
Rather than scrap the mandate or force utilities to pay hefty non-compliance fees, the
Massachusetts statute permitted power providers to import RECs (265,000 MWh of them in
2004) to meet their compliance obligations. By allowing utilities to trade RECs, the state RPS
ensured that the standard was met and that utilities invested in new clean electricity generation
that benefits Massachusetts and the nation. The shortfall also signaled to investors the strong
market for renewable generation and encouraged rapid development of in-state renewable
resources to offset future shortfalls.366
ENDI 08 35
RPS aff
Ultimately, although such issues will require effort and coordination, the process should be manageable because
independent efforts are already underway to "create a common currency for renewables, prevent double counting, and
support existing and emerging markets for renewables." n153
Regional programs, such as PJM's n154 Generation Attributes Tracking System (GATS), already track RECs in a way that
should be transferable to a federal program because it already handles multiple state programs. n155 GATS "tracks
generation attributes and the ownership of the attributes as they are traded or used to meet government standards." n156
Further, GATS creates generator-specific electronic certificates that list the attributes electricity suppliers need to satisfy
state policies and document renewable generation. n157 "Data in the GATS include megawatt-hours produced, emissions
data, fuel source, location, state program qualification and ownership of attributes for each [*70] megawatt-hour tracked."
n158 Similar REC tracking programs - including those affiliated with ERCOT, n159 ISO New England, n160 and the
Western Electricity Coordinating Council (WECC) n161 - exist, or are in development, throughout the country.
In fact, most U.S.-based RECs are tracked by technology created by a single company: "APX technology is now the system
of choice for every major renewable energy market in North America, including the PJM (GATS), ISO New England
(NEPOOL GIS), WECC (WREGIS), MISO (M-RETS) and ERCOT (Texas REC) markets." n162 The various state and
regional REC tracking programs were developed by state regulators who watched and learned from other states, then
implemented programs to meet the requirements of their own state. n163 "As a result, today a well proven, richly functional
infrastructure is in place to create, track and manage RECs and related environmental commodities across the nation's
largest regional markets." n164 Already, data indicates that a significant number of "regional stake holders have cross
regional interests" in the three fully operating major regional markets. n165 Given that the predominant technology for
tracking RECs is already working across regions with significant differences, a national solution should be feasible, if not
simple. n166
An effective national RPS would require oversight and enforcement of the program. The additional burden created by
tracking federal RECs should be manageable because monitoring compliance largely requires only that the regulator review
the number of approved federal RECs submitted by the covered utility, much of which can be done electronically. n167 As
long as the technological solution is trusted, such monitoring should be achieved largely via electronic RECs tracking
mechanisms, n168 thus easing the administrative burden. n169
Most of these burdens appear minimal at the federal and state levels. On the federal level, the Congressional Budget Office
(CBO) concluded "that transactions associated with the proposed federal permits would have no impact [*73] on the
federal budget." n183 On the state level, the CBO observed that state "regulatory entities would not be allowed to prohibit
utilities from recovering prudent costs associated with meeting the portfolio standard." n184 However, the CBO estimated
that the administrative costs related to that restriction, "if any, would be minimal." n185
ENDI 08 36
RPS aff
AT: NO ENFORCEMENT
RPS systems would be enforced via civil penalties that deter violations
Fershee, 08 – assistant professor of law at the University of North Dakota (Joshua, 29 Energy L. J. 49, “CHANGING
RESOURCES, CHANGING MARKET: THE IMPACT OF A NATIONAL RENEWABLE PORTFOLIO STANDARD ON
THE U.S. ENERGY INDUSTRY”, lexis)
[*71] For covered utilities that fail to meet the RPS requirements, the enforcement provisions of the Proposed RPS would
require additional review and possible adjudication. The Proposed RPS provides that a retail electric supplier that does not
comply with the RPS requirements "shall be liable for the payment of a civil penalty," n170 meaning that the Department of
Energy would need to review filings from, and assess penalties upon, those failing to report compliance with the national
RPS. n171 This enforcement, while adding an additional administrative burden, is necessary for an effective RPS. State
RPS programs with ineffective or under-enforced penalties have been less effective than those with strong enforcement
policies. n172 In Arizona, for instance, the "lack of enforcement and non-compliance penalties has resulted in significant
under-compliance with the [renewable energy] standards." n173
ENDI 08 37
RPS aff
Lesson 6: A national RPS should have flexible compliance rules, but aggressive penalties for
non-compliance
To deter utilities wishing to escape RPS obligations, any national standard must have penalties
for noncompliance equal to several times the market price of renewable energy credits. A
noncompliance penalty is needed not just to achieve more renewable generation, but also to
reduce aggregate compliance costs. This is because, in part, investors will base their renewable
energy commitments on the certainty that a market will exist for their product. Automatic
penalties imposed for each required tradable credit that retails fail to produce will give investors
confidence that there will be potential buyers for renewable electricity and unbundled RECs.367
Failure to create strict noncompliance penalties runs the risk of creating a “Catch-22” situation
where utilities make an insincere effort to obtain renewables from potential suppliers, and then—
when no renewables get built—claim that none are available. Policymakers could then view the
utility’s noncompliance as being in good faith, since there were no renewable energy
technologies available for purchase, rather than seeing the situation as proof that the utility never
intended to comply.368
An aggressive non-compliance penalty becomes self-enforcing and avoids the need to resort to
costly administrative and investigative measures. Such a program could be modeled after the
federal SO2 allowance trading program, under which an automatic $2,000/ton penalty (indexed
to inflation) is imposed for each excess ton of SO2 produced.369 It could also be based on the
Environmental Protection Agency’s National Ambient Air Quality standards, which require 22
states and the District of Columbia to reduce NOx emissions significantly by 2007370
Texas provides one of the best examples of the success of setting high non-compliance penalties.
In 1999, the Texas government required utilities to install 2,000 MW of new renewable capacity
by 2009. The standard was exceeded in 2001, with 915 MW of wind installed in that year alone
(See Figure X). 371
What made the state RPS so successful? An in-state REC trading scheme was established to
help track and account for renewable energy capacity, and coupled with strict enforcement
penalties. Utilities failing to meet the standard had to pay the lesser of 5 cents per kWh or 200
percent price of average REC prices for each missing kWh. Because non-compliance penalties
were set high above cost for installing new renewable energy technologies, not a single utility
failed to comply.372
ENDI 08 38
RPS aff
Flexibility in compliance rules also helps reduce non-compliance. In September, 2006, for
example, California accelerated its RPS from 20 percent by 2017 to 20 percent by 2010,
effectively adopting the most ambitious RPS mandate in the nation. However, to help regulated
utilities meet such an aggressive RPS target, the legislature adopted rules giving any utility the
option of deferring up to 25 percent of its compliance obligation in any single year for up to three
years. This rule effectively granted each regulated utility the ability to set its own compliance
schedule without substantially altering the regulated RPS target.
California’s regulated utilities responded favorably to the change. Hal LaFlash, Director of
Renewable Energy Policy and Planning for Pacific Gas & Electric (PG&E), recently told
industry analysts that the increased flexibility recognized market realities and “will facilitate
construction leadtimes and reduce boom-bust cycles.” 373
ENDI 08 39
RPS aff
Penalties for non-compliance may also play a role in explaining the shortfall. California has yet to levy any penalties on
utilities that are out of compliance or even to initiate regulatory dockets that could terminate in assessments. Even if the
penalties are imposed with certainty, however, their dollar impact will probably be small. A utility whose renewables are
out of compliance pays 5 cents for each deficit kwh, but its potential fine is capped at $ 25 million per year. It can avoid this
fine if renewables are too expensive and the state has no funds to cover the difference between the actual price and a
regulator-set cap. n117 Worst-case noncompliance leaves a utility with a maximum exposure of $ 25 million per year, and
actual penalties could be as low as zero. Other aspects of the political climate may also explain a lack of compliance, but
they are beyond our current scope. Having enacted seemingly stringent new standards, legislators may have little to gain
politically by vigorously enforcing [*107] them. At the same time, utilities and other interest groups may see the RPS as
another arena in which to advance their own causes, possibly by maintaining less than full compliance with its standards.
ENDI 08 40
RPS aff
Early in the life of a national RPS, the income received from REC sales will provide an incentive for investment in
qualifying renewable technologies even if they involve higher costs than other non-qualifying generating technologies.
n117 However, as the end date for the RPS program grows near (2030 in the EIA study), n118 the lesser amount of time
remaining where REC payments can be expected will reduce the expected benefit of the investment in qualifying renewable
generation. n119 As such, any new later-in-time investor will seek higher REC prices to compensate the shorter time
horizon under which they can recoup their investment. n120 This puts retail electricity suppliers in a difficult position under
plans such as the Proposed RPS. As the amount of energy that must come from qualifying renewable resources is
increasing, the incentive for building qualifying generation facilities is decreasing.
This could lead to perverse results. Under the Proposed RPS, as originally drafted, there was a cap on REC prices, n121 but
according to the EIA's analysis of a 15% RPS, by 2020, investors would be "unwilling to invest in sufficient amounts of
qualifying generation to meet the RPS target unless the credit price were to exceed the 1.9-cent price cap [used in the EIA
analysis]." n122 As a result, [*66] covered retail electricity suppliers would opt to stay in compliance with the RPS
program by purchasing RECs from the federal government at the price cap rather than purchasing RECs from new
renewable generation. n123 Interestingly, the "EIA analysis of an alternative RPS requirement with no cost cap and no
sunset provision indicates that the same targets as in the proposed program could be met in all years, and the credit price
would generally fall below the 1.9-cent-per-kilowatthour cap." n124 If, in fact, the market were to react as the EIA analysis
predicts (assuming passage of the Proposed RPS), it is hard to imagine that Congress would not act to extend or repeal the
sunset date. Regardless, any uncertainty related to the sunset and the availability of RECs to satisfy the RPS puts an
additional burden on retail electric suppliers by making the RECs market even harder to predict.
ENDI 08 41
RPS aff
Three primary components constitute the bulk of a wind turbine’s cost and weight: fiberglass for its blades, and steel and
cement for its tower. Industry projections for each of these components look exceptionally positive, suggesting lower
prices for future projects.
Around 81 percent of wind turbines currently in operation utilize fiberglass blades (the first models tended to use wood epoxy). Fiberglass blades are the only wind turbine component designed and
manufactured uniquely for wind energy applications. The U.S. composites and reinforced plastics industry shipped a record volume of 4.5 billion pounds of finished composites products to domestic
customers in 2006. To put this figure in perspective, while U.S. consumption of steel has doubled since 1960 and use of aluminum has almost quadrupled, composites shipments have multiplied 18 fold—
. The American Composites Manufacturing Association (ACMA) projects that
and industry representatives says they could easily expand much more
composite manufacturers would be able to provide enough fiberglass at competitive prices in the next three years to power
100,000 MW of wind energy (or 6 percent of the country’s entire electricity supply).333
The availability of steel and concrete looks just as positive. The global steel industry outperformed all other basic-material sectors in 2006, achieving a total
shareholder return of 37 percent. Such sustained profits are helping to stabilize steel prices and is encouraging significant investment in the industry, which is expected to grow 4 percent every year
reaching a production level of 1.7 billion tons by 2015.334 Industry consolidation, as well as growing demand in India and China, has made producers much more “cost efficient and sensitive to changes in
global consumption patterns.”335
The global concrete industry—an $8.6 billion industry in the United States—continues to operate in an environment of similar guaranteed profits, as at least one segment of the construction industry is
always in demand for their products.336 Cement companies have announced plans to invest more than $3.6 billion dollars to expand domestic capacity totaling more than 11 million tons between now and
2010—enough to keep prices low even with the added demand of wind turbine installations.337
The DOE projects the costs for all other components of wind turbines to remain stable or even decline, especially as greater
bulk purchases drive costs down.338
One DOE report noted that “low cost of materials and reliability” will continue to be the “primary drivers” fueling expansion of wind energy.339
Costs will continue to decline as developers diversify some of the materials used to make wind turbines. New manufacturing techniques, such as resin infusion and vacuum bagging, as well as material
innovations (such as carbon and glass epoxies, improved resin systems, and better exploitation of traditional fiberglass reinforcement with engineered fabrics) have enabled turbine manufacturers to
optimize weight in modern turbine designs.340 The next generation of turbines will have longer, thinner, and more durable blades.341
In 2004, the Renewable Energy Policy Project (REPP) found that demand for wind turbine materials and components would allow more than 16,000 companies (with approximately 1 million employees) to
enter the turbine manufacturing market.
sustained demand for wind turbine materials and components would encourage these sectors to invest
The REPP report concluded that
more around $50 billion in 50,000 MW of wind capacity should demand for wind turbines required it. 343
ENDI 08 42
RPS aff
A typical, solar photovoltaic (PV) panel consists of five “layers” of materials: a glass or plastic cover, a plastic anti-
reflective layer made of plastic, a front contact to allow electrons to enter a circuit, the semiconductor layers that directly
convert sunlight into electricity, and a back contact to allow electrons to complete the circuit.
Most solar cells are manufactured using crystalline silicon as the primary raw material (the same material used to produce
integrated circuits for computers). More than 90 percent of PV manufacturers use traditional mono- or polycrystalline
silicon wafers in their modules (which represent the bulk of the total cost of the solar cell).344
While the industry experienced a shortage of silicon for PV production a few years ago (the price for silicone doubled from
$30 per kilogram in 2003 to $60 per kilogram in 2005), the crisis helped spur rapid investment in PV manufacturing.
Most companies now have extensive stockpiles of silicon needed to guarantee PV production, and many have signed
fixed-price contracts guaranteeing a supply of silicon.345 The CFO of one large international PV manufacturer recently
boasted that, “at this time we have 100 percent of our silicon wafer supply contractually secured.”346 The sale of Shell
Solar’s crystalline solar business to SolarWorld in 2006 is expected to secure even more access to silicon and promote
more efficient production processes with higher yields.347
Since the high demand for PV modules has enabled manufactures to pre-pay for supply, many silicon companies have
massively expanded their production processes: Tokuyama is building a 200-ton half commercial vapor to liquid
distillation pilot plant in Japan. Wacker already has a 100-ton fluidized bed reactor pilot plant in Germany. The company
REC is looking to build a 200-ton pilot plant in Moses Lake, WA. These expansions ensure that an additional silicon
production capacity of 5,900 tons per year dedicated exclusively for PV arrays will come online in 2008.348
Annual revenues for the solar industry are expected to increase more than fourfold from $20 billion 2006 to $90 billion in
2010. At the same time, production costs are projected to fall dramatically.349 In April, 2007, the managing director of
Australia’s largest PV manufacturer, noted that the industry was seeing “incremental changes in innovation which are
pushing down costs and helping the sector's expansion.” He concluded that falling costs will make the solar power
industry increasingly competitive.350
ENDI 08 43
RPS aff
The irony of the Bush Administration’s argument for rejecting a national RPS is that the current
system of state-based RPS mandates itself is fostering significant inequalities between states.
While ratepayers in RPS states pick up the tab for cleaning the air and water,
other states enjoy artificially deflated electricity prices as they tap cheap sources of energy,
which pollute the environments of neighboring states.
In economics, those consuming more than their fair share of a resource while shouldering less
than their share of the costs of producing it are called “free riders”.171 Relying on states alone to
adopt RPS programs creates a classic free rider problem because environmental damage from
conventional power plants does not stop at state borders. SO2 and NOx emissions from coal-fired
plants in Midwestern states drift across borders and cause acid rain to damage watersheds in the
Northeast.172 Mercury from power plants in the Ohio Valley is deposited in Maine’s forests and
New Hampshire’s lakes.173 The resulting environmental problems provide powerful incentives
for affected states to adopt more aggressive renewable energy policies while non-affected states
(that are often the source of the pollution) get a “free ride”.
ENDI 08 45
RPS aff
The relative maturity of a technology does not appear to affect the tendency for capacity factors
to improve the more the technology is deployed.. System operators and utilities, for example,
have announced plans to build more than 150 coal-burning electricity plants in 42 states
(representing 85 GW of capacity) by 2025. During the same period, the National Energy
Technology Laboratory expects the capacity factor for coal generators to grow to above 80
percent.162
Nuclear reactors also prove the concept. The World Nuclear Association notes that nuclear
generators had a capacity factor of around 10 percent when just 22 GW were deployed. Yet their
capacity factor rose to 30 percent with the deployment of 53 GW and close to 90 percent once
installed capacity reached 97 GW. 163
Similarly, the capacity factor for hydroelectric generators and geothermal plants rose in direct
correlation with the amount of total installed capacity. 164
By forcing a greater amount of installed renewable capacity, a national RPS will
significantly improve the capacity factors of renewable energy technologies.
Recent experience with wind energy seems to confirm this rule. In 2000, for example, wind
turbines reported capacity factors in the low teens. But by 2006, when installed wind energy had
more than tripled in the U.S., wind turbines registered capacity factors in the mid 30s. Capacity
factors for wind turbines started off in the low teens before rising to the high 20s in 2000 and the
mid 30s in 2006.
Newer wind projects in Oahu, Hawaii, and San Gorgonio, California, have even achieved
capacity factors of 36 and 38 percent (respectively).165 In a 2006 analysis, the EIA observed that
wind turbine capacity factors appeared to be improving over time and concluded that “capacity
factor grows as a function of capacity growth.”166
Solar energy appears to follow this same pattern. In the early 1980s, when just 10 MW of solar
photovoltaics had been installed globally, the average capacity factor for solar panels was around
9 percent. By 1995, however, after more than 70 MW had been installed, the average capacity
factor of panels jumped to almost 15 percent. 167
In 2000, Researchers from the Institute for Energy Policy and Economics found that “over the
last 10 years ‘learning by doing’ has led to a simplification of industrial manufacturing processes
… As a result, costs have fallen considerably [and] efficiency levels on the order of 18 percent
for cells are expected in the near future at a competitive cost.”168
Given the historical trend recorded by almost every electricity generating technology, it is likely
that a national RPS will not only improve the stability of the electricity grid, but will also
accelerate the capacity factors of renewable energy technologies—further lowering their cost and
enhancing their technical reliability.
ENDI 08 46
RPS aff
Recent advances in renewable energy technologies have made them much less land-intensive. In fact, the Worldwatch
Institute recently estimated that harnessing renewable energy for electricity production requires less land than conventional
systems. The study noted that solar power plants that concentrate sunlight in desert areas, for instance, require 2,540 acres
per billion kWh. On a lifecycle basis, this is less land than a comparable coal or hydropower plant generating the same
amount of electricity.327 Similar projections from the National Renewable Energy Laboratory (NREL) demonstrate that
solar and wind technologies use extensively less land than conventional systems when their complete fuel cycles are
considered.
The American Wind Energy Association (AWEA) estimates that in open and flat terrain a large- scale wind plant will
require about 60 acres per MW of installed capacity (this drops to as little as 2 acres per MW for hilly terrain). However,
AWEA emphasizes that only 5 percent (3 acres) or less of this area is actually occupied by turbines, access roads, and other
equipment—95% remains free for other compatible uses such as farming or ranching.329
At the High Winds Project in Solano, California, 8 different landowners host 90 separate 1.8 MW wind turbines that total
162 MW of electricity capacity, but are still able to use almost all of the farmland around and between the turbines.
Using a conservative figure of 26 acres for each wind turbine, researchers from Oberlin College estimated that 40 square
miles could support roughly 38,000 turbines producing 3-4% of total US electric demand each year. The actual footprint
of these turbines would be roughly 10,000 acres, leaving the surrounding 990,000 acres of land either untouched or
available for other uses. This figure beats both coal and natural gas in terms of total land use.330
NREL estimates that solar PV could supply every kilowatt-hour of our nation’s current electricity requirements with
modules on only 7% of the country’s available roofs, parking lots, highway walls, and buildings without
substantially altering appearances.
Solar PV requires even less new land. A PV system at the California Exposition Center in Sacramento, California, for
example, fully integrates 450 kW of PV into a parking lot. Indeed, NREL concluded that, “a world relying on PV would
offer a landscape almost indistinguishable from the landscape we know today.”331
For example, the Energy Policy Initiatives Center at the University of San Diego School of Law recently estimated that the
City of San Diego could construct 1,726 MW of solar PV relying only on available roof area downtown.332
ENDI 08 47
RPS aff
Evidence from recent history also proves false the accusation that large wind systems risk power
outages from the abrupt loss of wind. In an analysis of the effects of integrating wind power in
New York State, for example, researchers for General Electric analyzed the actual output records
of wind farms in use for over 5 years and found no evidence that wind power output changed so
abruptly as to require contingency plans and back-up generation:
Analysis of historical statewide wind data indicates that loss of wind generation due to
abrupt loss of wind is not a credible contingency. Short-term changes in wind are
stochastic (as are short-term changes in load). A review of wind plant data revealed no
sudden change in wind output in three years that would be sufficiently rapid to qualify as
a loss-of-generation contingency for the purpose of stability analysis. While the wind can
vary rapidly at a given location, turbines are spread out in a project, and the projects are
spread throughout the state, making such an abrupt drop in total output an extremely
unlikely event.155
Pumped hydro and compressed air energy storage systems can also be coupled to renewable
energy technologies to smooth out intermittency. Bonneville Power Administration (BPA), a
large federal utility in the Pacific Northwest, for example, uses its existing 7,000 MW
hydroelectric and pumped hydro storage network to store renewable energy. Starting in 2005,
BPA offered a new business service to “soak up” any amount of intermittent renewable output,
and sell it as firm output from its hydropower network one week later.156 Such storage
technologies can have greater than 1,000 MW of capacity (depending on location), and operate
according to fast response times and relatively low operating costs. Storage systems like BPA’s
are already commercially available and provide a combined 22.1 GW of installed capacity in the
U.S.157
Technological Diversity
Under a national RPS, intermittent generators are not only likely to be geographically dispersed,
but also technologically dispersed. That is, a national RPS would expand the diversity of
technologies used to access renewable resources. Technological dispersion increases system
reliability by decreasing dependence on any one intermittent source of energy. Utilities can
harness wind on windy days, sun on sunny days, hydropower on rainy days, etc.
ENDI 08 48
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Short-term deflation in natural gas prices obfuscates the costs associated with natural gas price volatility. In hearings
before the House Committee on Natural Resources in 2003, the CEO of one large chemical company told Congress, “the
recent history of natural gas prices is a study in commodity price volatility.”69 For example, the price of natural gas
jumped from $6.20 per million BTUs (MMBtu) in 1998 to $14.50 per MMBtu in 2001, then dropped precipitously for
almost a year and then rebounded steadily from around $2.10 per MMBtu in 2002 to more than $14.00 per MMBtu near
the end of 2005.70
When natural gas prices swing wildly, utilities find it difficult to plan prudent investments or contract for bulk supplies.
The enormous price spikes for natural gas seen over the last few years have made natural-gas fired plants uneconomic to
operate, and have resulted in significant increases in electricity prices in several areas, much to the consternation of utility
executives.72 From April through June of 2006, Platts conducted surveys of utility executives to analyze perceptions of
important issues facing the electricity industry and to identify issues that may cause concern in the future. Natural gas
supply shocks were mentioned repeatedly as a justification for significant rate increases:
The issue for utility executives is how best to deal with the increases and volatility in natural gas prices. The added costs
to produce electricity or provide natural gas cannot be absorbed by local distribution companies (LDCs) and many are
facing the need to file for rate relief and pass those costs through to end-users. The added issue for many is timing.
Rising natural gas prices are occurring simultaneously with the end of rate caps, causing end-users to potentially see rate
increases of more than 70 percent in some regions. Managing these rate shocks and the backlash, which is often directed
towards deregulation, is a serious issue.73
Indeed, in fall of 2006 ratepayers in Illinois waged a modern-day version of the Boston Tea Party, sending teabags to the
state’s utilities in protest of projected rate increases of 22 percent to 55 percent in 2007. In Boston, homeowners and small
businesses have seen electricity prices rise by 78 percent since 2002, from 6.4 cents a kilowatt hour to 11.4 cents a kilowatt
hour.74 Across the U.S., average retail electricity prices rose by 9.2 percent in 2006 alone, a trend likely to continue
for the next several years.75
Natural-gas induced price spikes have been devastating to the U.S. economy. Because natural gas accounts for nearly 90
percent of the cost of fertilizer, escalating natural gas prices in 2005 created significant economic hardships for U.S.
farmers. As well, some manufacturing and industrial consumers that relied heavily on natural gas moved their facilities
overseas. The U.S. petrochemical industry, for example, relies on natural gas as a primary feedstock as well as for fuel.
On February 17, 2004, the Wall Street Journal reported that the petrochemical sector had lost approximately 78,000 jobs to
foreign plants where natural gas was much cheaper.76
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RPS aff
Paul Cicio , president of the Industrial Energy Consumers of America, brought his concerns and those of the businesses his
group represents to Congress. Cicio testified before Congress about the impact of higher energy prices.
"The US remains in a serious natural gas crisis that started in mid-2000," Cicio said. He said the situation is more alarming
than most of the public realizes.
"In our view, the only reason the US is not rationing natural gas today is because high natural gas prices since year 2000
have significantly contributed to the shutdown of manufacturing plants throughout the country, resulting in the loss of 3
million high-paying jobs." Cicio said. "These plant shutdowns reduced the manufacturing sectors' natural gas consumption
by 23.4 percent since year 2000, which freed up over 1.5 trillion cubic feet of natural gas for other consuming sectors."
As a result, the US is balancing its supply of natural gas on the backs of good manufacturing jobs, he said.
"This is neither good energy, economic nor employment policy," he said. "Unfortunately, this trend will continue so long as
high relative natural gas prices exist."
ENDI 08 51
RPS aff
Gas. Utilities. Labor. And now, even the price of fertilizer is spiking.
Farmers are feeling the pinch and preparing to raise prices, though the actual increase hasn't been determined yet.
"I think the price of fertilizer has doubled from what it was three years ago," said Robbie Bartlett of Bartlett Farm in
Salisbury. "This year it went up quite a bit and will push prices up."
Bartlett, the tenth generation to run Bartlett Farms, has planted sweet corn and vegetables for several years. But this year he
says it will be hard to keep prices low as the price of fertilizer increases.
According to the Fertilizer Institute, a Washington D.C.-based trade association that represents the represents the fertilizer
industry, there are a number of reasons prices have risen. Thanks to factors as diverse as the ongoing natural gas crisis,
criminal uses of fertilizer to create methamphetamine, and rising worldwide demand, fertilizer prices will make growing
and eating vegetables will be expensive this summer.
"The prices of fertilizer in April were the highest on record," said Estelle Grasset, public affairs specialist for the institute.
She said the institute focuses primarily on educating the public and government of why prices are so high to begin with.
"The bottom line is the farmer is not just competing against his neighbor anymore but also the farmer in India and China as
the demand is high worldwide."
Commodity prices of fertilizer are influenced heavily by supply and demand and by high gas prices and increased demand
for fertilizer and nitrogen products worldwide, the U.S. is suffering.
"Higher energy prices, a significant demand for transportation and even weather-related events have caused shipping and
distribution costs to rise," the Fertilizer Institute says in its monthly pamphlet.
ENDI 08 52
RPS aff
ARLINGTON, Va., April 15 /U.S. Newswire/ -- The U.S. Department of Labor reported today that U.S. wholesale prices
surged 1.1 percent in March, the second-largest increase in the past 33 years, exceeded only by a 2.6 percent rise in
November 2007. Energy prices jumped 2.9 percent for March, with natural gas up 4.2 percent, and the U.S. economy
continues to show signs of weakening. In 1999, U.S. natural gas prices were $2.38 per million BTUs (MMBtu). Today, they
are $10.25 per MMBtu.
The American Chemistry Council (ACC) issued the following statement:
"U.S. natural gas prices have been rising for more than seven years while Congress failed to adequately address the
domestic energy supply problem. Manufacturers, residential consumers, farmers, small businesses, schools and hospitals
have felt the pain of the natural gas crisis in lost business, lost jobs, reduced global competitiveness and higher home
heating and electricity bills. In the business of chemistry, our energy costs have tripled, from $25.1 billion in 1999 to $72.8
billion in 2007. For our industry and others that compete globally, we cannot simply pass along these higher costs. Instead,
we lose U.S. production, business and jobs - often to overseas operations and competitors, where natural gas is far less
expensive. Already, millions of American manufacturing jobs are gone.
Increased natural gas demand for electricity generation collapses the chemical industry
Gupta 03, Chairman and CEO of Rohm and Haas company, (Federal Documents Clearing House Congressional Testimony,
3/19, lexis)
A crisis of this magnitude poses a grave threat to America's economic and national security. Current energy prices are
making it impossible for the US chemical industry, and other critical industries, to compete in global markets. Because the
business of chemistry produces the building block materials that the rest of our modem economy relies upon, we are
somewhat of a "canary in the coalmine." As we go, so goes the rest of the nation.
In particular, the US chemical industry's economic survival depends on having access to an abundant and affordable supply
of natural gas. Natural gas is almost exclusively a domestic energy source, yet we all must operate in a global marketplace.
We compete with producers from Asia, Europe, and the Middle East. Current natural gas prices have turned the US
chemical industry into the world's high-cost producer. From our perspective, it is not an exaggeration to say that an
economic disaster is unfolding in this nation because of dangerously volatile prices in natural gas markets. Critical
infrastructures like the chemical industry are extremely sensitive to wild swings in energy prices. Without a secure supply
of energy, the industries that contribute to the nation's economic and national security are deeply compromised.
What we are facing is not a seasonal disturbance, but a fundamental structural imbalance in supply and demand for natural
gas. America has developed a tremendous thirst for natural gas. It is clean. It is efficient. And until recently, it was abundant
and cheap. Consumers love it for heating their homes. Environmentalists love it because it is clean burning. Industries,
including the chemical industry, love it because it is an excellent raw material that makes its way into thousands of products
that everyone one of use, every day.
Because we love it, America is using more and more gas. Natural gas used to generate electricity has increased by 35
percent in the past five years and will nearly double in the next decade. Almost all new power generating capacity coming
on line in the US is gas fired. Half of new homes are now heated by gas. America is becoming an economy that runs on
natural gas.
ENDI 08 53
RPS aff
Most importantly, some proponents of a federal standard say it will cut costs for consumers. One of the key ways an RPS
could save money is by decreasing the use of natural gas to generate electricity.
"The reason why that's important is because the natural gas market has been extremely volatile, and there are lots of
indications it's only going to go up," said Benjamin Sovacool, co-author of the "Renewable America" report.
Investments in renewable resources will reduce the use of natural gas, driving down demand and, therefore, price for
natural gas, Sovacool said. This yields net savings.
"So the utilities save money and they can pass on those savings to rate payers," he said.
ENDI 08 54
RPS aff
Despite strong public support and rapidly rising interest in renewable ener-gy, the United States has not kept up with the
strong growth in renewables over the past decade; as a result,its marketshare has fallen steadily. For example, while
U.S. solar cell manufactur-ing has risen year by year, the nation’s share of globalproduction has declined
from 44 percent in 1996 to below 9 percent in 2005.
Time is growing short for the United States to get back in the game and compete for what could be some of the largest
new markets of the next few decades. A strong partnership between government and the private sector is essential
if that kind of leadership is to be achieved.
ENDI 08 55
RPS aff
In addition to supporting domestic job creation, clean energy is an important and fastest growing international sector, and
one where overseas policy can be used to support poor developing regions – such as Africa (Jacobsen and Kammen, 2007)
and Central America – as well as regaining market share in solar, fuel cell and wind technologies, where European nations
and Japan have invested heavily and are reaping the benefits of month to year backlogs in clean energy orders. Some of
those orders are for U. S. installations, but many more could be if we choose to make clean and green energy a national
priority for both domestic installation and overseas export.
Technology exports have impacts well beyond domestic job creation. In fact, if properly managed, the development of a
thriving ‘cleantech’ sector can address a vital global issues, namely the emissions trajectories of major developing nations.
China and India are often singled out for attention as major, emerging global emitters. China, in fact, will become the
world’s largest greenhouse emitter in the near future, if it has not already. This fact, is often used – mistakenly in my view
– to argue against unilateral climate protection efforts by nations such as the United States. This view is shortsighted in two
vital respects. First, China is demonstrably already suffering from the impacts of fossil fuel use. Crop yields in many parts
of China are significantly lower than they would be without the significant sulfur and particulate burden that results from
domestic coal combustion. (In fact, coal combustions emissions from China have significant air quality impacts on Japan,
and can be measured in the U. S. as well.) Crop losses of over 20% have been reported in part of China, with the
decrease unambiguously linked to air pollution. China also experiences significant human health impacts from this
pollution burden as well.
Second, China has committed, on paper, to a ‘circular economy’ where waste is reduced and overall productivity is
enhanced. If the United States were to become a major exporter, or even a partner, in the production of low-emissions
technologies – from truly carbon-capture coal-fired power plants, to increased numbers of solar, wind, and biofuel
technologies – China would be an eager trading partner, so that they could install increasing numbers of low-emissions
technologies. This would directly help the Chinese economy and their environmental and public health situation.
ENDI 08 56
RPS aff
Perhaps the most important, if not the most obvious, potential benefit of a national RPS is economic development and job
creation. In projecting the impact of a 20% national RPS, the Union of Concerned Scientists determined that, by 2020, such
an RPS "would generate more than 355,000 jobs in manufacturing, construction, operation, maintenance, and other
industries - nearly twice as many as fossil fuels, representing a net increase of 157,480 jobs ... ." n61 Further, it was
determined that renewable energy would "provide an additional $ 8.2 billion in income and $ 10.2 billion in gross domestic
product in the U.S. economy in 2020." n62 Although premised on a national RPS percentage higher than that in the
Proposed RPS, these numbers nonetheless indicate that a national RPS could provide significant economic benefits.
The most compelling job creation claims come from a report developed by the Renewable Energy Policy Project (REPP).
The group determined that more than 16,000 firms in all fifty states have the technical potential to enter the growing wind
turbine manufacturing sector. n63 The twenty states that would potentially benefit the most, receiving 80% of the job
creation, are the same states that account for "76% of the manufacturing jobs lost in the [U.S. over the] last 3 1/2 years."
n64
Expanding renewable energy would create economic benefits that ripple throughout the economy
Flavin and Podesta, 06 – *president of the Worldwatch Institute AND **president of the Center for American Progress,
(Christopher and John, American Energy: The Renewable Path to Energy Security
http://www.worldwatch.org/files/pdf/AmericanEnergy.pdf)
If the increased use of renewable energy led to significant reductions in fossil fuel prices, consumer savings on electricity
and natural gas bills would ripple through the U.S. economy, spawning even more jobs . It would also provide a tremendous
economic boost to rural communities. Most of the jobs created in renewable energy would be highpaying positions for
skilled workers, in fields such as manufacturing, sales, construction, installation, and maintenance.
A 2004 Renewable Energy Policy Project study determined that increasing U.S. wind
capacity to 50,000 MW—about five
times today’s level—would create 150,000 manufacturing jobs, while pumping $20 billion in investment into the national
economy. Renewable heating and biofuels also offer significant employment opportunities. The U.S. ethanol industry
created nearly 154,000 jobs throughout the nation’s economy in 2005 alone, boosting household income by $5.7 billion.
Booming markets for renewables around the world may provide additional opportunities for U.S. companies and workers.
A 2003 study by the Environment California Research and Policy Center determined that California’s Renewable Portfolio
Standard— which required that 20 percent of electricity come from renewable sources by 2017 (a target date since pushed
to 2010)—would create a total of some 200,000 personyears of employment over the lifetimes of plants built through that
period, at an average annual salary of $40,000.An estimated 78,000 of these jobs would serve overseas export markets.
By contrast, employment in the fossil fuel industries has been in steady decline for
decades, in large measure due to growing automation of coal mining and other processes. Between 1980 and 1999,while
U.S. coal production increased 32 percent, related employment declined 66 percent, from 242,000 to 83,000 workers.The
coal industry is expected to lose an additional 30,000some jobs by 2020, even if coal demand continues to rise. Further,
high prices for fossil fuels have a negative impact on the economy , even leading to the transfer of
manufacturing jobs
overseas. Expanding the
use of renewable energy can help minimize these losses and provide new opportunities for
displaced workers.
ENDI 08 57
RPS aff
• Renewables generate 80% more jobs than equal investment in fossil fuels.
A 20% RPS by 2020 would create as many as 240,000 new jobs – in manufacturing, construction, operations, maintenance,
shipping, sales and finance – versus 75,000 jobs if the energy were provided by fossil fuels.
• A national RPS creates new jobs in states with the greatest manufacturing losses.
The 20 states that would gain the most manufacturing jobs from a national investment in wind energy, for example,
represent more than 2/3 of the manufacturing jobs lost in the U.S. between 2001 and 2004.
ENDI 08 58
RPS aff
The Renewable Energy Policy Project used North American Industrial Classification Codes to map the dispersion of
manufacturing activity related to the development of wind energy and found that the 20 states that would receive the most
investment and most new manufacturing jobs account for 75% of the total U.S. population, and 76% of the manufacturing
jobs lost in the U.S. between 2001 and 2004.
However, the regional dispersion of economic benefits is not limited to the wind manufacturing sector or to the states of
the upper Great Plains, where the most substantial wind resources are located. In the Southeast, for example, researchers
at the University of Tennessee estimated that renewable energy technologies (including biomass generators and
incremental hydropower) could create more jobs per MWh for the region than any other type of electricity generation.102
The American Society of Mechanical Engineers (ASME) projected even better job creation estimates for renewable energy
technologies deployed nationwide. In a 2004 study, ASME estimated that coal and gas facilities provide only 11 job-years
per MWh, while renewable technologies can provide as many as 121 job-years per MWh.103
When researchers at UCS examined the cumulative economic impact of a 20 percent national RPS by 2020, they found that
the mandate would create almost 80% as many jobs as continued reliance on fossil fuels - more than 355,000 new jobs in
domestic manufacturing, construction, operations, maintenance, shipping, sales, and finance.104
By UCS estimates, the difference in the number of jobs created compared to fossil fuels (157,480 net jobs created by a
national RPS) would generate an additional $8.2 billion in income and $10.2 billion in gross domestic product ($2002).105
This makes sense for both environmen- tal and economic reasons. Renewable sources such as wind, solar, biomass, and
geothermal produce not just very few greenhouse gas emissions but more jobs, too. A 2007 analysis by the Union of
Concerned Scientists suggests that a 20 percent national renewable elec- tricity standard by 2020 would create 185,000
jobs, save consumers $10.5 billion on energy bills through 2020, and reduce CO2 by 223 million metric tons a year.110
In the past decade, our competitors, using smart policies, have made great progress on renewable technologies, seizing
leadership in both wind and solar technology. The United States has wind and solar sources far greater than those in
Europe or Japan. The missing ingredient here is willpower and a set of clear, predictable rules.
ENDI 08 59
RPS aff
The energy problems Californians have experienced in the past six months are just a foretaste of what’s expected soon.
According to Fox’s KTVU News in San Francisco, this summer there could be 100 to 300 hours of blackouts, most
occurring during the middle of the work day when demand for energy peaks. That would mean chaos for California and
severe repercussions for much of the U.S.
California accounts of 1/6th of the U.S. economy. California produces most of the nation’s fruits and vegetables, and is the epicenter of America’s high-
tech industry. Most micro-chip and computer manufacturers are in California, and California is also the hub for much of our trade to the Pacific Rim.
Major energy problems in California would severely damage an already shaky national economy.
If the expected 100 to 300 hours of blackouts this summer occur, the effects on California residents and businesses could be disastrous: no traffic lights,
elevators, ATMs, air conditioning, refrigeration, computers, hundreds of businesses forced into bankruptcy, hundreds of thousands laid off.
Even if it’s not that bad and blackouts are less severe, major problems could still occur. Food processors in California’s
Central Valley, say it can take three days to clean up the mess created when machinery is stopped cold by an unannounced blackout. It can take four hours
to get newspaper presses up and running after a shutdown. A cut off of traffic signals for even a few hours, can cause grid-lock the
entire day. A few hours without power can also destroy days of production at high-tech plants. At plants which use volatile
chemicals, there is even the risk of chemical explosions when power shuts down unexpectedly, according to company spokesmen.
California’s energy crisis is creating another huge problem: Skyrocketing electricity prices are bankrupting people on fixed
incomes as well as scores of businesses. In San Francisco’s East Bay-area, the price of residential natural gas has gone up 5-fold since last year.
Electricity has already gone up 40% and is expected to increase another 100% this summer. Many people on fixed incomes are being forced to choose
between eating and paying their utility bills. The situation is so bad that on April 16th, officials in Contra Costa County, east of San Francisco,
recommended creating "heat shelters” for senior citizens who face cut off of electricity and no air conditioning this summer.
Businesses that don’t have long-term power contracts are also being bankrupted. One Sonoma County rose nursery owner says he was forced to close his
doors when he was warned that his electric bill would increase $20,000 in December 2000 to an estimated $310,000 in December 2001.
The cause of the energy crisis in California and throughout the nation is over-regulation, a powerful, environmental
movement which has blocked construction of new power plants and transmission lines, and local opposition to new power
plants. As a result, not a single major new power plant has been built in California in over 10 years, despite a 12% increase in population
and a rapidly expanding economy.
Improved reliability of supply is important, as blackouts and brownouts exact a considerable toll on the American economy.
The U.S. Department of Energy, for example, estimates that while power interruptions often last only seconds or minutes,
they cost consumers an average of $150 to 400 billion every year.150 The Electric Power Research Institute projects the
annual costs of poor power reliability at $119 billion, or 44 percent of all electricity sales in 1995.151
ENDI 08 60
RPS aff
A national RPS may not only compel some utilities to invest in transmission upgrades sooner rather than later, it may
actually help them to do so. Often, utilities face public opposition when trying to win regulatory approval for new
transmission lines. Environmental groups may argue that the utility is overbuilding the system or that alternative solutions
were overlooked. Local landowners may object to transmission line rights-of-way or oppose substations located too close
to their property. In Faquier County, Virginia, one county Supervisor recently rallied local opposition to Dominion
Power’s preferred route for a 500 kV line, declaring, “This is a fight to the death!”130
“Transmission is the most difficult infrastructure project to site and more so than generation,” according to Ron Poff of
American Electric Power (AEP). “You can get support from politicians. But when the not-in-my-backyard factor weighs
in, the politicians will pull the rip cord.”131 Poff should know. In 1990 AEP sought permission to build an 89-mile
transmission line through parts of West Virginia and Virginia. After major concessions to objectors (including rerouting
the line to avoid the area’s rivers and wildlife), the project finally began transmitting power some 16 years later.
Delays in transmission siting and development add substantially to the cost of infrastructure projects. To site transmission,
utilities often incur significant pre-certification expenses and risk stranded costs should a permit be denied or public
opposition halt the project. In most cases the costs of project delays are capitalized as the project moves forward, creating
investor uncertainty and adding to construction costs which are eventually passed on to ratepayers.132 The longer a
transmission project is delayed, the more it costs to finance and the more utilities must raise rates to recover those costs.
Recent experiences suggest that opposition to transmission projects turns to broad public support if it is justified by
the need to interconnect new renewable generation. In 2003, for example, Xcel Energy received approval from the Minnesota Public Utilities Commission (PUC) to
site 178 miles of new transmission lines and four new substations to facilitate a tripling in size of its Buffalo Ridge wind farm. Early in the process, Xcel justified the new transmission as critical to
expanding wind power generation at Buffalo Ridge, whose transmission lines were already fully subscribed.
In a remarkable reversal of norms, local stakeholders accused the company of not proposing an adequate amount of new transmission and not working to build it fast enough. One senior environmental
consultant noted how local landowners and advocates perceived environmental and economic benefits from renewable energy and that perception translated into overwhelming support for Xcel’s
transmission upgrades:
The combination of expanded use of renewable energy and the associated influx of potential economic gain in rural,
primarily agricultural, regions have led to unprecedented support of the transmission line projects. Environmental groups view the
increased use of a renewable energy source as a positive step and recognize the need for additional transmission capacity to support siting of renewable generation facilities.133 Xcel’s experience with
Buffalo Ridge is a case study for how other utilities can win public approval for network upgrades that ultimately benefit all generators. By justifying transmission expansions through RPS-induced
renewable generation, utilities can overcome opposition that would delay or stop transmission upgrades under normal circumstances. The cost-savings associated with quicker project approvals result in
lower rates for consumers who would otherwise pay for the delays.
And because modern transmission systems are required to respect FERC’s Open Access requirements, line owners are not allowed to discriminate on the basis of generation source in the distribution of
transmission resources. Therefore, transmission built initially to access renewable resources can facilitate infrastructure expansions that benefit the entire portfolio of generation sources.
Transmission upgrades justified by substantial new renewable generation can buy time for zero-emissions coal and carbon
sequestration technologies to become commercially viable.134
Because renewable energy projects have construction lead-times that are years (or even decades) faster than the lead-times
for conventional or nuclear facilities, they can start generating electricity to be sold over new transmission lines much
faster. Renewable energy systems, therefore, can start providing revenue to help pay down debt on transmission
investments while conventional plants are waiting to come online. If this expedited debt repayment is calculated in
hypothetical capital structures, it may depress the projected capital costs of transmission expansions and provide a natural
check to excessive rate increases. A national RPS mandate may therefore have the added benefit of decreasing the
financing costs of new transmission and protecting ratepayers from excessive price increases.
ENDI 08 62
RPS aff
Any given hour there is a 10 percent risk that electricity from conventional power plants will be unavailable or limited due
to forced outages and mechanical failures. 143 A national RPS can help respond to such failures by promoting
technologies that have a higher rated technical reliability. Modern wind turbines, for example, have technical reliability
above 97.5 percent, compared to coal and natural gas power plants with technical reliabilities that rarely exceed 85 to 90
percent.144
Because the technical availability of one wind turbine rivals that of a single conventional power plant, wind farms of
hundreds or thousands of turbines have even greater reliability (since it is very unlikely that all turbines would be down at
the same time). And even when turbines do malfunction, they take far less time to recover than massive conventional
power plants or nuclear reactors that have literally millions of individual components all arranged in complex circuits
prone to mechanical failure.145 In fact, the International Energy Agency recently concluded that: Bigger units of power
plants bring with them the need for both greater operational and capacity reserve since outages cause greater disturbances
to the system. The higher the technical availability, the lower the probability of unexpected outages and thus the lower the
requirements of short-term operational reserve. Wind power plants actually score favorable against both criteria, since they
normally employ small individual units (currently up to 5 MW) and have a record of high technical availability.146
In Europe, utilities and system operators have heavily promoted renewable energy for precisely this reason. The American
Wind Energy Association, for example, estimates that by 2005 Europe had installed almost three times as much wind
energy as the U.S.—48,500 MW of installed capacity, 9,000 MW of which had been installed in 2005 alone.147
Analysts have already confirmed the benefit of wind power’s greater technical availability in the United States. Indeed, a
November 2006 study assessing the widespread use of wind power in Minnesota, concluded that “wind generation does
make a calculable contribution to system reliability” by decreasing the risk of large, unexpected outages.148
The U.S. government has already acknowledged the ability of renewable energy systems to deter major power outages and
provide consistent power supply. A recent assessment from the U.S. Department of Defense, for instance, found that
increased deployment of renewable energy resources significantly improved overall system reliability.149 The study,
which focused on the deployment of wind, solar, and geothermal electricity generators on and near military installations,
found that:
1. Renewable energy facilities contribute to energy security by enabling military facilities to operate during simulated
outages
2. Renewable energy generators enable the possibility of storing excess energy when power output is high
3. Renewable energy resources help “segregate” a service area from outside influences, creating “self-sustaining regional
islands” that can provide “critical installation functions”
4. Renewable power may be more reliable during routine or prolonged power outages than conventional generators, which
may have restricted hours of operation
ENDI 08 64
RPS aff
By promoting wind, solar, and other renewable resources that do not consume or withdraw
water, a national RPS can help conserve this dwindling essential resource. In a 2006 report, the
Department of Energy acknowledged wind power and solar photovoltaics could play a key role
in averting a “business-as-usual scenario” where “consumption of water in the electric sector
could grow substantially.”264
A recent DOE report noted that “greater additions of wind to offset
fossil, hydropower, and nuclear assets in a generation portfolio will result in
a technology that uses no water, offsetting water-dependent technologies.”265
Ed Brown, director of Environmental Programs at the University of Northern Iowa, estimated
that a 100-watt solar panel would save approximately 2,000 to 3,000 gallons of water over the
course of its lifetime. Similarly, Dr. Brown concluded that “billions of gallons of water can be
saved every day” through the greater use of renewable energy technologies.266
The American Wind Energy Association conducted one of the most comprehensive assessments
of renewable energy and water consumption. Their study estimated that wind power uses less
than 1/600 as much water per unit of electricity produced as does nuclear, 1/500 as much as coal,
and 1/250 as much as natural gas (small amounts of water are used to clean wind and solar
systems).267
In short, by displacing centralized fossil fuel and nuclear generation, a national RPS conserves
substantial amounts of water that would otherwise be withdrawn and consumed for the
production of electricity.
ENDI 08 65
RPS aff
Particulate matter is not a specific pollutant itself, but instead refers to a mixture of fine particles
of harmful pollutants such as soot, acid droplets, and metals. Particulate matter (PM) is the
generic term for the mixture of these microscopic solid particles and liquid droplets in the air.
Because its make-up is often complex, PM is by far the most difficult pollutant to detect and
monitor.
Roughly half of the nation’s 250,000 tons of PM emissions come indirectly from the NOx and
Sox emitted from power plants, which react in the atmosphere to form dangerous PM
particles.291 When both these primary and secondary conditions are included in estimates,
individual power plants release between 100 and 400 tons of PM every year.292
Inhalation of PM is strongly associated with heart disease and chronic lung disease. 293 Since
microscopic solids or liquid droplets are so small, they can get deep into the lungs and cause
serious health problems. Numerous scientific studies have linked PM exposure to:
• Irritation of the airways, coughing, or difficulty breathing
• Decreased lung function
• Aggravated asthma
• Development of chronic bronchitis
• Irregular heartbeat
• Nonfatal heart attacks
• Premature death in people with heart or lung disease.294
Roughly 80 million Americans live in areas where PM emissions are considered dangerous.295
Particulate matter emissions from power plants alone
are responsible for more than 23,000 premature deaths each year
…as well as nearly 22,000 hospital admissions, more than a half-million asthma attacks
(resulting in 26,000 hospital emergency room visits), more than 38,000 heart attacks, and
over16,000 cases of chronic bronchitis.296 These health affects have a devastating impact on the
U.S. economy and are estimated to have cost the U.S. workforce over three million lost work
days.297
Toxic contamination of the planet threatens human survival. In our time, we will determine whether
there is clean air to breath, water to drink and places to live for our children and theirs. Industrial
technology-with its shadow of pollution-overwhelms us and threatens the democratic structures on
which we depend.
ENDI 08 66
RPS aff
Yet carbon-intensive fuels continue to dominate electricity generation in the United States. By
2005, almost 90 percent of the country’s greenhouse gas emissions were energy-related, with the
electric utility industry outpacing all other sectors (including transportation) with 38 percent of
national carbon dioxide (CO2) emissions.
Fossil-fueled power plants in the U.S. emitted 2.25 billion metric tons of C02 in 2003, more than
10 times the amount of C02 compared to the next-largest emitter, iron and steel production.301
Put simply, of all U.S. industries, electricity generation is—by substantial margins—the single
largest contributor of the pollutants responsible for global warming.
In 2004, almost every state in country was home to at least one power plant with significant C02
emissions.
The International Atomic Energy Agency estimates that when direct and indirect carbon
emissions are included, coal plants are around 10 times more carbon intensive than solar and
more than 40 times more carbon intensive than wind. Natural gas fares little better, at three
times as carbon intense as solar and 20 times as carbon intensive as wind.304 The Common
Purpose Institute estimates that renewable energy technologies could offset as much as 0.49 tons
of carbon dioxide emissions per every MWh of generation. According to data compiled by the
Union of Concerned Scientists, a 20 percent RPS would reduce carbon dioxide emissions by 434
million metric tons by 2020—a reduction of 15 percent below “business as usual” levels, or the
equivalent to taking nearly 71 million automobiles off the road.305
These estimates are not simply theoretical. Between 1991 and 1997 renewable energy
technologies in the Netherlands reduced that country’s annual emissions of CO2 by between 4.4
million and 6.7 million tons. Renewable technologies were so successful at displacing
greenhouse gas emissions that Europe now views renewable energy as “the major tool of
distribution utilities in meeting industry CO2 reduction targets”.307
-- It is completely practical to regulate greenhouse gas pollutants through a variety of Clean Air Act authorities pertaining to
mobile and stationary sources. Through these authorities, EPA could set performance standards for global warming
pollution from the vast majority of U.S. emissions sources. Electric power plants, for example, represent 40 percent of U.S.
CO2 emissions and could be regulated under Section 111. Other major industrial sources subject to Section 111 account for
another 20 percent or so of these emissions. Motor vehicles and their fuels represent another 20 percent of U.S. CO2
emissions and their fuels and could be regulated under Sections 202 and 211.
ENDI 08 68
RPS aff
By taking the lead in transforming our own economy, we can lead in the cre-ation of a global market that can benefit
countries and communities around the world. Just as important, we can provide the global leadership that is desperately
needed to manage the impact of climate change in the developing world—as a matter of principle, as a measure of our
commitment to a more equitable world, and for practical reasons given the high costs and widespread instability that
climate change will trigger in the world’s poorest countries.
The solution to climate change must be a global one. The United States is a large part of the problem, with only 5 percent
of the world’s population yet responsible for 23 percent of worldwide emissions.147 At the same time, most of the growth
in emissions going forward will be gener-ated by developing countries whose col-lective increase in emissions will account
for over 75 percent of global emissions growth by 2030.148
Indeed, in 2006 (well ahead of even recent forecasts) China surpassed the United States as the world’s leading emit- ter of
greenhouse gases, although U.S. per capita emissions remain higher than China’s.149 It is thus clear that rapidly
industrializing countries—China chief among them—will have a big role to play in containing climate change.
The United States will simply have no credibility with other nations unless we have vigorously addressed the problem at
home. As we are putting our own mandatory system in place, we will need to re-engage vigorously in the diplomatic
arena. The principal forum for climate change negotiations to date has been the U.N. Framework Convention on Climate
Change under which the Kyoto Protocol was negotiated. The UNFCCC process is the one that President Bush walked
away from shortly after he took office. We must reverse course and reassert constructive U.S. leadership.
ENDI 08 69
RPS aff
At present there is much talk about the unparalleled strength of the United States on the world stage. Yet at this very
moment the most powerful country in the world stands to forfeit much political capital, moral authority and international
good will by dragging its feet on the next great global issue: the environment. Before long, the administration's apparent
unwillingness to take a leadership role -- or, at the very least, to stop acting as a brake -- in fighting global environmental
degradation will threaten the very basis of the American supremacy that many now seem to assume will last forever.
American authority is already in some danger as a result of the Bush administration's decision to send a low-level
delegation to the World Summit on Sustainable Development in Johannesburg -- low-level, that is, relative to America's
share of both the world economy and global pollution. The absence of President Bush from Johannesburg symbolizes this
decline in authority.
In recent weeks, newspapers around the world have been dominated by environmental headlines: In central Europe,
flooding killed dozens, displaced tens of thousands and caused billions of dollars in damages. In South Asia, the United
Nations reports a brown cloud of pollution that is responsible for hundreds of thousands of deaths a year from respiratory
disease. The pollution (80 percent man-made) also cuts sunlight penetration, thus reducing rainfall, affecting agriculture and
otherwise altering the climate. Many other examples of environmental degradation, often related to the warming of the
atmosphere, could be cited. What they all have in common is that they severely affect countries around the world and are
fast becoming a chief concern for people everywhere.
Nobody is suggesting that these disasters are directly linked to anything the United States is doing. But when a country that
emits 25 percent of the world's greenhouse gases acts as an uninterested, sometimes hostile bystander in the environmental
debate, it looks like unbearable arrogance to many people abroad.
The administration seems to believe it is merely an observer -- that environmental issues are not its issues. But not doing
anything amounts to ignoring a key source of world tension, and no superpower that wants to preserve its status can go on
dismissing such a pivotal dimension of political and economic -- if not existential -- conflict.
In my view, there is a clear-cut price to be paid for ignoring the views of just about every other country in the world today.
The United States is jettisoning its hard-won moral and intellectual authority and perhaps the strategic advantages that
come with being a good steward of the international political order. The United States may no longer be viewed as a leader
or reliable partner in policymaking: necessary, perhaps inevitable, but not desirable, as it has been for decades. All of this
because America's current leaders are not willing to acknowledge the very real concerns of many people about global
environmental issues.
No one can expect the United States to provide any quick fixes, but one would like to see America make a credible and
sustained effort, along with other countries, to address global environmental problems. This should happen on two fronts.
The first is at home in the United States, through more environmentally friendly policies, for example greater fuel-
efficiency standards for cars and light trucks and better insulation for buildings. The second is international, through a more
cooperative approach to multilateral attempts at safeguarding the environment. Simply rejecting international treaties (like
the Kyoto Protocol) then failing to offer a better proposal cannot be an acceptable option for American policymakers.
Much of the world has come together to help the United States in the fight against terrorism, out of the realization that a
common threat can only be beaten through a cooperative effort. It is high time for the United States, metaphorically
speaking, to get out of its oversized, gas-guzzling S.U.V. -- and join the rest of the world in doing more to combat global
warming and protecting the planet.
ENDI 08 70
RPS aff
WITH each passing day, the scope of the United States' and allied responses to the terrorism of Sept. 11 becomes clearer
and clearer. But the attacks on America, and the wider trends from which they emerged, point to another pressing need -
one that is so far going unnoticed. The events of Sept. 11 sealed the national security argument for a massive national
investment in renewable energy.
Without new sources of energy, the US will be increasingly hostage to the few countries still producing large amounts of
oil, and frighteningly vulnerable to energy-related aggression and terrorism. About a decade from now, we will import some
70 percent of our oil, and the Middle East will account for perhaps 70 percent of world oil exports. Energy rivalries, price
volatility, and the strategic vulnerability of oil will intensify.
The threats emerging from this vortex of energy insecurity could take many forms. Two or three small nuclear warheads
detonated in the right places in the Persian Gulf would bring the world economy to a standstill. A regional bully circa
2010 or 2015 will be able to hold at risk a far greater proportion of the world's daily energy diet than did Saddam Hussein
in 1990.
If our vulnerability to this sort of mischief was substantial before Sept. 11, it is much greater today. Osama bin Laden and
his followers are intent on sparking a war between extremist Islam and the West. To the extent that they succeed even in
part of their agenda - threatening, for example, the stability of the regime in Saudi Arabia - US and world oil supplies will
rest on even shakier foundations.
As recent events make clear, too, the problem isn't just global, it is also domestic. A fossil-fuel-dependent, long-range-
energy-grid economy is susceptible to terrorist attacks from local or global troublemakers.
How, then, can we begin a transformation in our sources of energy? Advocates of such a shift usually offer punitive or
restrictive approaches, from regulations to enforced conservation, to achieve their goal. Such regulations are politically
charged, though, and they don't really solve the problem - they only delay the day of reckoning. Truly escaping the fossil-
fuel trap demands different kinds of fuels.
It demands a visionary approach to energy security and environmental sustainability that ought to be very attractive to
President Bush. He could, for example, announce his intention to reduce the threat posed by the slow exhaustion of fossil
fuels, and commit the US to a dramatic increase in the proportion of the total energy it generates from decentralized,
renewable sources within a specific time frame - say, by 2010.
Such a goal is achievable. Many renewable energy technologies - solar, wind, fuel cells, biomass - are now within shouting
distance of the potential for widespread use in terms of reliability, practicality, and, most important, cost-competitiveness
with fossil fuels. Some renewables just need scale; with bigger markets, per-user prices will drop. In other cases, rigorous
research and development remain necessary.
ENDI 08 71
RPS aff
The EIA studies, on the other hand, indicated moderate increases in costs to consumers. n143 Depending on the parameters
of the RPS, it is possible that a national RPS could change almost nothing operationally, if the cost of the major
infrastructure changes is too high or the incentives too low. For instance, if the RPS includes a cost cap that is too low, most
utilities would simply buy RECs from the government rather than invest in renewable projects. In this scenario, only the
easiest renewable energy programs would be pursued, and it is likely those programs will occur with or without a national
RPS. As discussed in Part III.C, the EIA predicted this kind of outcome in the latter stages of a proposed 15% RPS. n144
Quite simply, developers of renewable energy projects will not invest in projects if most of their customers have a cheaper
way out.
ENDI 08 72
RPS aff
The momentary relief from the supply of unconventional gas sources coming into production will not last long as U.S.
demand grows -- especially with legislation pending to set U.S. limits on greenhouse gas emissions, Souki said. With
growing opposition to coal and with the construction of new nuclear plants many years off, he said the United States has
little choice but to use more natural gas.
"We are in a natural gas crisis" when new domestic supply cannot make up for declining traditional sources, Souki said.
"When the trouble comes," he added, "it is going to come in a hurry."
ENDI 08 73
RPS aff
Lesson 4: A national RPS should apply equally to all retail power providers
Some state-based RPS statutes initially excluded some power providers in an attempt to protect
certain types of utilities. In practice, the attempt to carve out exemptions through imprecise
statutory language created confusion and uncertainty for regulated entities. In Connecticut, for
example, the state’s RPS exempted default service providers, creating speculation among all of
the state’s regulated utilities that the law would not be enforced at all.362 And in Washington,
utilities with no load growth are exempted from the state’s RPS mandate, if parts of the state
experience decreased population growth or diminished electricity demand, load serving entities
would be absolved from their regulatory burden entirely.363
Applying the standard to all retail power providers—including investor owned utilities, publicly
owned utilities, municipalities, and rural electric cooperatives—creates an equal playing field
and avoids creating inconsistencies in regulation. Requiring all retail providers to meet the
mandate reduces opportunities for “free riders” within the electricity sector. Regulated utilities,
which pay to clean the air and conserve the water, would not be required to subsidize the
generation of dirty, low-cost non-renewable electricity from exempt generators.
A standard applying to all providers also creates better economies of scale and ultimately helps
drive down the cost of renewable generation for all suppliers. By applying the mandate
uniformly and without exemption, a national RPS avoids the kind of regulatory unpredictability
that initially plagued Connecticut’s program.
ENDI 08 74
RPS aff
5. Utilities, most of which own base-load and peaking assets, would be required to comply
with a national RPS mandate, not individual power plants. Kydes comparison of the
marginal cost of electricity from each individual facility owned by a regulated utility
artificially inflated the cost estimates of a national mandate by ignoring how renewable
generation would offset energy production across a utility’s entire portfolio.
ENDI 08 75
RPS aff
1.Since a properly-designed national RPS would require all retail utilities (including
publicly owned utilities, municipal utilities, and electric cooperatives) - not individual
states - to meet RPS mandates, the burdens and benefits of a national program are likely
to reflect the emerging interstate nature of the U.S. electricity market. Regulated utilities
are not limited to developing the renewable resources within the state where they are
headquartered. They may invest in renewable resources wherever their development is
most cost competitive.
By eliminating PUCHA, Congress opened the door to “area hopping.” As utilities begin
to consider long-term consolidation strategies that include the acquisition of relatively
far-flung companies, PUCHA’s repeal creates merger options not previously available.
One investment fund analyst noted that PUCHA’s repeal “changes the planning dynamic
… a utility’s possible map is no longer just three states; it’s the whole country.”205
ENDI 08 76
RPS aff
As a second example, consider Arizona, which created a “carve out” for solar photovoltaic
technologies by mandating that at least 50 percent of the state’s RPS must be met by solar
technologies. To meet the non-solar part of the RPS, utilities bought approximately 10 MW
landfill gas and several additional MW of biomass energy. However, utilities have been unable
to fully comply with the solar mandate because of the sizeable financial commitment needed to
purchase more expensive solar technology.378
Arizona has created even more incentives for the solar market by offering $4 per watt of utility-
scale installed photovoltaics. However, utilities pass the higher cost of solar onto ratepayers.
Tucson Electric Power is scheduled to complete a 64 MW thermal solar plant in Boulder City,
Arizona, by the end of 2007, costing ratepayers an estimated $106 million,379 even though solar
photovoltaic is still by far the most expensive renewable energy technology in the state (See
Table 1) .380
Allowing the market to dictate deployment does not mean utilities will not invest in solar and
other more expensive renewable energy technologies. It does, however, mean that utilities will
not invest in them first. Instead, power providers will maximize all of their least-cost options
before moving to more expensive technologies. The Renewable Energy Policy Project put it this
way:
The RPS will tend to support those renewables that are cheapest at the margin. In
California’s case, wind power would likely benefit the most, with geothermal and
biomass also benefiting as the size of the requirement increases. Distributed renewable
generation technologies such as PV and small wind turbines are unlikely to benefit as
much from the RPS in the near term, due to their higher cost and greater barriers to
installation.381
The long term stability of an RPS ensures that investors and manufacturers will have time to
develop more cost effective methods of utilizing renewable resources. In the long run,
manufacturers may benefit from waiting until renewable energy technologies are ready for the
market instead of forcing deployment of inferior technology to meet unrealistic state targets.
In the end, the point of an RPS is not to set restrictions on when and where renewables can be
deployed. Like “natural selection”, it is the market—not the regulators or politicians—that
should decide which technologies investors should develop to meet a national RPS mandate. 382
ENDI 08 78
RPS aff
Lesson 8: A national RPS should be simple, and set no further regulatory interventions
Many advocates of both state and national RPS proposals have argued (sometimes fiercely) in
favor of adding even more complexity into such statutes. Some have argued for price ceilings on
electricity rates to give utilities a possible safety valve; others have argued for mid-course
reviews of RPS statutes to make sure that they are working; still others have argued for credit
multipliers (also called tiers or carve outs) for particular resources (such as solar), geographic
restrictions, and limits on the capacity and size of eligible resources.
While some of these ideas have merit, the burden is on those in favor further market
interventions to justify them. Further regulations may unnecessarily complicate RPS statutes and
inhibit the efficiency of a national RPS program. As researchers from the Lawrence Berkeley
National Laboratory recently concluded:
A well-designed RPS should generally encourage competition among renewable
developers and provide incentives to electricity suppliers to meet their renewable
purchase obligations in a least-cost fashion.375
Two of the fundamental elements of an RPS—competition and least cost—are violated by
creating carve outs, multipliers, geographic restrictions, or limits on capacity and size. In
principle, competition and cost effectiveness is best served by letting the marketplace dictate
when and where renewable technologies are deployed. In practice, such interventions have
weakened the effectiveness of some state RPS proposals.
ENDI 08 79
RPS aff
As might be expected, the retail electric suppliers in states with an RPS are expected to account for the bulk of the
renewable energy generating capacity in the United States. n97 It is clear that RPS states have built, and are building, more
renewable energy generation facilities than non-RPS states, but it is not clear to what extent this is the result of an RPS
policy. That is, an RPS policy provides incentives for building new renewable generation capacity, but other factors,
especially the availability of renewable energy resources, also play a significant role. n98
ENDI 08 81
RPS aff
The argument that a national RPS would hurt states without abundant renewable resources
misunderstands the modern electricity market. Since its inception nearly a century ago, the
electricity sector has become increasingly interstate in nature. And now that Congress has lifted
regulatory restrictions on electricity holdings companies, utilities that would be subject to a
national RPS are not limited to developing renewable resources within the states they are
headquartered.
Under a national RPS, utilities can invest in renewable generation
wherever renewable resources are most abundant.
Setting a floor rather than a ceiling allows states to set more aggressive target
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Lesson 7: A national RPS should set only a floor, allowing the states to be more aggressive
Setting a “floor” rather than a “ceiling” ensures that more aggressive state statutes are not
precluded or restricted under a federal standard. In essence, then, a national RPS would set a
minimum that only prohibits states (or in this case, utilities that operate within and between
states) from deploying less renewable energy than a national standard, not more. The states
should be free to exceed the federal standard as much as they wish. This type of compliance
with state programs is often called “dual compliance” or “simultaneous compliance.” The
national standard would only guarantee the promotion of a minimum level of renewable energy
deployment.
Such language should be clear and explicit in any national legislation, so as to provide the
maximum amount of clarity and predictability to utilities and investors, and to avoid leaving the
question open to political attacks during Congressional deliberations. Congress did something
similar with the Clean Air Act of 1965, which allowed California to establish vehicle air
pollution emission standards. All other states were given the opportunity to adopt California’s
standards or remain subject to the federal standards developed by the Environmental Protection
Agency.374 Such flexibility ensured that the states could continue to innovate while also
mandating that all states moved forward in promoting cleaner air.
ENDI 08 82
RPS aff
For all of the reasons just cited, a strong case can be made for federal governance to preempt state initiatives that have
proliferated on the RPS and climate change fronts. The concern, however, is that through the process of reaching federal
consensus, some of the most aggressive and meaningful state programs will be preempted, leaving a watered-down, lowest-
common denominator national standard in their place. Such a concern is not merely academic. University of Arizona law
professor Kirsten Engel has noted that in the 1970s, federal preemption was prompted by the desire to impose stronger
federal programs than states themselves would impose. The 1990s, however, saw a turnaround in which industry interest
groups are advocating federal preemption to eliminate aggressive state standards.36
At least three of these efforts have surfaced in Congress during the past three years. In 2004, a proposal was advanced that
would have overridden the states' ability to set more stringent zoning authority for the permitting of oil refineries and
utilities. Another bill would have waived all forms of liability for industries involved in the production and sale of
antifreeze coolants containing benzoate. And an amendment to a 2005 appropriations bill prohibited states from attempting
to duplicate California's efforts to create more protective automobile emissions standards.37 Thankfully, each of these
efforts failed, but there has been talk that a federal RPS might include nuclear power and clean coal as "renewable" options,
a prospect that not only goes against common sense but strains credulity as well.
The answer to this conundrum is to specifically allow for a multi-jurisdictional system of authority over RPS and climate
change. University of Michigan professor of public policy Barry Rabe and his colleagues have noted that the decision to
pursue action at the federal or state level need not be perceived as an either/or proposition. 38 In other words, jurisdictional
overlap is not only possible, but may even be preferable.
This could be accomplished by establishing a federal "floor" without a "ceiling"; that is, a rule that would impose
requirements on each and every state but that would still allow states to exceed the federal minimum standards imposed. A
federal RPS floor, for example, might be a requirement for retail electricity providers to meet a 15 percent renewable target
by 2020 or 2025. States, however, could be permitted to raise the requirement to 20-25 percent within their own
jurisdictions should they wish to do so. The federal floor might also consist of a standard set of renewables for inclusion.
Once the minimum federal requirements are met through these renewables, states could add their own preferences to meet
state-based goals, whether they want to provide special incentives to promote solar photovoltaics in the Southeast, small-scale hydroelectric in the
Pacific Northwest, or offshore wind along the East Coast.
Similarly, greenhouse gas emission reduction targets could consist of a federal minimum as well as an additional state target. It may be that a federal floor
will only set reduction targets out to 2020, while some states will want to go on record as requiring emission cuts of at least 60 percent by 2050. A multi-
jurisdictional framework can accommodate these differing goals and time frames, and it harkens back to a time in the 1960s and 1970s when federal
preemption meant requiring all states to meet a minimum level of requirements, rather than a more recent preoccupation with eliminating all the state
regulations that overlap.
The 1967 amendments to the Clean Air Act of 1963 is an example as it allowed California to establish vehicle air pollution emission standards that were
more stringent than those developed by the U.S. Environmental Protection Agency (EPA). In the Clean Air Act Amendments of 1977, all other states were
given the opportunity to adopt California's standards in the future or remain subject to the EPA standards. California has requested and been granted more
than 40 exceptions to EPA emission standards, and the system has not been overly burdensome to automakers.39
In areas outside of environmental regulation, the federal government has a long history of promoting minimum national
standards that the states can exceed. The Fair Labor Standards Act, for instance, establishes a national minimum wage of
$5.15 per hour and preempts Kansas's miserly rate of $2.65 but is surpassed by 38 other states that have set their own laws
higher than the federal statute-with Connecticut offering $7.65 and Oregon $7.80.40 Other federal "floors," "savings
clauses," and "safety valves" have been established in the areas of health care insurance, civil rights, drug safety, and the
sentencing of hate crimes.41
Federal environmental law generally allows states to enact standards stricter than federal laws as reflected in the Clean
Water Act, and more recently in the Toxic Substances Control Act, Resource Conservation and Recovery Act, Federal
Insecticide Fungicide and Rodenticide Act, and in the area of brownfields regulation.42 Such flexibility in terms of a
federal RPS or climate change statute would ensure that the states can continue to innovate while also mandating that all
states move forward in promoting renewable energy and addressing climate change.
ENDI 08 83
RPS aff
Legal challenges over state RPS are inevitable – both from utilities and lawmakers
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor of Government and
International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC), a national non- profit organization committed to
reforming U.S. energy policy (Benjamin and Chris, Renewing America: The Case for Federal Leadership on a National Renewable Portfolio Standard
(RPS), June, http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
A particularly ugly legal battle arose from one utility’s claim that Iowa’s RPS mandate was inconsistent with existing
federal statute. In 1984, MidAmerican Energy Company, the largest investor-owned utility in the state, challenged the
legality of Iowa’s RPS mandate on the grounds that it obligated the utility to purchase power from renewable energy
facilities at rates in excess of the avoided cost set by the federal Public Utility Regulatory Policies Act (PURPA).216
MidAmerican and the state of Iowa spent 15 years and countless dollars locked in a heated legal battle before the issue was
settled in 1999 (in the utility’s favor).217
The legal morass generated by state-based RPS strategies also can discourage renewable energy investments by
creating risky and unpredictable markets. While MidAmerican was busy fighting Iowa’s RPS statute in court, it was not
installing new renewable capacity. Upon settlement of the dispute, however, the company invested roughly 10 percent of
its entire portfolio in 568 MW of new wind energy. Similarly, PacifiCorp held back on investments in nearly 1,400 MW of
renewable capacity throughout the nation until the situation in Iowa was resolved.218
Similar delays in renewable energy investments will occur with the continued emphasis on a state-by-state approach to
RPS. Indeed, MidAmerican has signaled that it is prepared to litigate against new RPS statutes in Oregon and Washington,
risking uncertainties in renewable energy investments in the Pacific Northwest for years, possibly decades.219
Professor Joel B. Eisen, Director of the Center of Environmental Law and the University of Richmond, doesn’t mince
words in declaring his belief that the retail electricity market represents the essence of interstate commerce:
Electricity involves a national marketplace that reaches every American and cannot be carved into neatly defined or clearly
distinct markets and regulatory jurisdictions. It is perhaps the clearest case of unfettered Commerce Clause jurisdiction
extant today.220
Yet, state RPS mandates remain perpetually unprotected from constitutional legal challenges. In many ways, the conflict
created by having state RPS policies regulate an interstate electricity market sits precariously atop a legal house of cards
that could collapse at any time. Article 1, section 8 of the Constitution grants Congress the power “to regulate commerce
with foreign nations, and among the several states, and with Indian tribes.” In the many years since ratification of the
Constitution, the U.S. Supreme Court and other lower courts have consistently repealed state legislation that may hinder or
prohibit interstate trade.221
ENDI 08 85
RPS aff
A Commerce Clause challenge may also be imminent because of a growing tension between state and federal
electricity regulators.
While the legality of state RPS geographical restrictions has yet to be challenged on Commerce Clause grounds, Eisen
warns that state and federal regulators are starting to engage in a kind of “Commerce Clause brinksmanship”. 233 As
recently as 2006, for example, Constellation Energy threatened to sue Maryland’s Public Utility Commission on
Commerce Clause grounds for rejecting its merger with Baltimore Gas and Electric. 234
A June 2006 report from the Pew Center on Global Climate Change speculates that recent changes on the U.S. Supreme
Court also call into question how long state restrictions can avoid Constitutional challenge:
But it is conceivable that policies that are in some way designed to minimize the role of out-of-state renewables in meeting
RPS targets could face a constitutional challenge. Examples of such policies include those that confine acceptable imports
to those that arrive via a dedicated transmission line, most notably Nevada and Texas. The constitutional boundaries are
not at all clear in this area, especially given the recent departure from the Supreme Court of Justices William Rehnquist
and Sandra Day O’Connor, who held strong views on the power of the states in relation to the federal government.235
If a state RPS were found to violate the Commerce Clause, the practical affect would be its immediate repeal. While state
legislatures could try to craft an RPS that would pass constitutional muster or appeal to a higher court, one successful
challenge would be enough to risk a cascade of copy-cat litigation as regulated entities piggy-back on judicial precedent.
In any event, the result is a risky and unpredictable regulatory environment threatening the longevity of state-based RPS
mandates and the long-term stability of the nation’s renewable energy market.
Finally, state-based renewable portfolio standards risk challenges on legal grounds. Article 1, section 8 of the U.S.
Constitution grants Congress the power "to regulate commerce with foreign nations, and among the several states, and with
Indian tribes."23 In the many years since ratification of the Constitution, the U.S. Supreme Court has consistently used the
converse of this part of the commerce clause (hence its description as the "dormant commerce clause") to strike down state
legislation that it has determined might hinder or prohibit interstate trade. In 1986, the Court defined this to mean that a
state cannot "needlessly obstruct interstate trade or attempt to 'place itself in a position of economic isolation.'"24 The
smooth functioning of the national market requires the federal government to prevent states from adopting protectionist or
autarkic policies that would attribute a product's market share to its geographic origins rather than to market mechanisms.
Two potential conflicts exist between state RPS policies and the dormant commerce clause: geographic restrictions on
eligible renewable resources and the different ways states assign value to RECs. Illinois, Nevada, New Jersey, and Texas
have all adopted restrictions that only count in-state renewable resources toward their respective RPS mandates. Some
states that have implemented their own RPS mandates have adopted policies that devalue RECs from other states.
California's RPS, for example, requires RECs to be bundled (thus disallowing unbundled RECs from other states). While no
one has yet challenged the legality of these restrictions, several legal precedents suggest that a legal case against these
restrictions could prevail.25
Taken together, state action on RPS is insufficient in significantly promoting national renewable energy capacity. Despite
the progress made by state RPS, the deployment of renewable resources has stayed relatively the same. Almost 10 years
ago, renewable energy technologies constituted approximately 2 percent of the country's electricity supply (when excluding
large hydroelectric facilities).26 In 2006, the U.S. Energy Information Administration (EIA) estimated that
nonhydroelectric renewables still provided about 2 percent of America's electricity supply. Even when all state RPS are
included in projections, EIA estimates that the contribution of renewable resources is unlikely to exceed 3 percent of total
electricity supply by 2017 or 4 percent by 2030.27
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Local and regional efforts to combat climate change suffer from analogous difficulties relating to design, complexity,
fairness, and sufficiency. Like RPS programs, state climate change policies lack consistency and harmony. Most attempt to
promote research, ensure economic stability, and encourage public-private cooperation. However, they tend to place very
little emphasis on mandatory standards and fail to create predictable regulatory environments. In other words, state policies
"provide lots of carrots but without any sticks."28
Having a multitude of state greenhouse gas policies is also more costly than a single federal standard because it creates
complexity for investors. State-by-state standards significantly increase costs for those attempting to conduct business in
multi-state jurisdictions.29 Statewide programs also require separate inventory, monitoring, and implementation
mechanisms to check progress against goals and provide feedback, adding to their costs.30 In addition, state programs
provide incentives for local and regional actors to duplicate their research and development efforts on carbon-saving
building technologies and energy systems, compromising a degree of efficiency.31
In addition, as mentioned above, stateby- state action on climate change is prone to what is known as the "free rider"
phenomenon. For example, utilities operating in a region that includes those states with mandatory emissions regulations
and those without has an extra incentive to build new power plants only in those without. PacifiCorp, a utility serving
customers in the Pacific Northwest, has repeatedly attempted to build coal-fired power plants in Wyoming and Utah-states
without mandatory greenhouse gas reduction targets- but not in Oregon (which has mandated a stabilization of greenhouse
gas emissions by 2010) or Washington (which has mandated 1990 levels by 2020).32 The state-by-state patchwork of
climate change policies, in other words, allows stakeholders to manipulate the existing market to their advantage.
Localized climate action also sends distorted price signals. By lowering demand for carbon-intense products, state
standards reduce the regional (and even global) price for carbon-intense fuels. But in doing so, they provide further
incentives for nearby states without climate regulation to do nothing because of lowered prices.33 Put another way, states
acting on climate change depress the cost of fossil fuels and other carbon-intense commodities by lowering demand for
them and thus their price. Yet reduced prices encourage overconsumption in areas without carbon caps, decrease the
incentive to enact energy efficiency and conservation measures, and discourage the adoption of alternative fuels for
vehicles and renewable energy technologies.
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Other policy initiatives and reforms need to be evaluated in light of changing electricity markets. For example, utilities--which can often integrate
intermittent capacity by changing how other generating units are dispatched or exploiting portfolio effects--have less incentive to do so when they are not
investing in the capacity themselves. Independent developers cannot take advantage of the systemwide opportunities for integrating intermittent
renewables that would be available to the purchasing utility. Regulatory changes may be needed to help independent developers offer firm capacity by
bundling projects in a range of locations to sell power to one or more utilities, or by using renewables with fossil fuel or other back-up capacity located
elsewhere. Such options would allow them to compete with nonrenewable power producers for utility solicitations limited to dispatchable power.(26) In
addition to prohibiting dispatchability requirements in power purchases, regulators should require utility planners to fully evaluate measures for integrating
intermittent renewables from independent developers. A critical task for a national strategy is to reduce the cost per kilowatt-hour of
electricity from renewable technologies to enhance their competitiveness. To address the chicken-or-egg dilemma in
marketing renewables, one must alleviate the uncertainties facing renewable equipment producers regarding future demand.
Costs for several technologies would fall if the federal government coordinated regional and national programs to aggregate
renewable equipment needs of individual utilities into a predictable stream of orders (see Table 1 on this page). (Table 1 omitted)
Need for a National Strategy
Restructuring trends underscore the urgency of developing a national strategy for advancing renewable energy that
coordinates public and private efforts and targets the barriers facing certain technologies. The strategy must be national
because some of renewable energy's benefits--such as the creation of jobs--accrue to states, whereas others--such as
slowing climate change and reducing air pollution--affect much larger areas and groups of people. A national strategy could
help balance the costs and benefits of commercializing and deploying renewable energy technologies at different
geographic scales. Visible and consistent national leadership would guide the development of states' electricity industry
policies. Without federal leadership, state policies on electric utility competition, rate design environmental protection, and
demand management are less likely to benefit the nation as a whole.
In this era of fiscal austerity, the old axiom that there is no free lunch must be taken seriously. The chronic federal budget crisis makes new initiatives that
cost money a hard sell. Many policies recommended here entail only minor government spending, but others can be costly. The need for cost-effectiveness
should underpin all program decisions. Even if one utility engages in a successful collaborative demonstration project with the renewable energy industry,
for example, other utilities in the region may not be interested. The federal government should therefore sponsor such cost-shared projects only in states
where the market and policy environment is conducive to replication--for instance, where the PUC requires utilities to fully account for the attributes of
renewables in resource planning and acquisition.
Policy tools should be designed and implemented to push renewables toward commercial maturity. Accordingly, the implementation period should be
ample and predictable, and any necessary subsidies designed to buffer emerging technologies from extreme market swings without insulating them from
all competition. At the same time, the performance of various strategies must be tracked so that future policymakers and program managers are not in the
dark.
With relatively low fossil fuel prices, market forces in the United States are less auspicious for renewable energy development now than they were during
the 1970s, Only with a concerted push from high-ranking officials in state and federal government and under the aegis of a
national strategy can the nation ever fully harness the enormous potential of renewable energy.
A Federal RPS is needed to set a clear target for industry research, development and market growth
Kammen, 1 – Professor of Energy and Society Director at the Renewable and Appropriate Energy Laboratory Energy and
Resources Group
(Daniel, FDCH Congressional Testimony, “Energy Tax Incentives,” 7-11-2001, Lexis-Nexis Universe) // JMP
Energy Policy and Financial Recommendations (continued) A Federal Renewable Portfolio Standard (RPS) to Help Build
Renewable Energy Markets
I support a 20 percent RPS by 2020. A number of studies indicate that this would result in renewable energy development in
every region of the country with most coming from wind, biomass, and geothermal sources. A clear and properly
constructed federal standard is needed to set a clear target for industry research, development, and market growth. I
recommend a renewable energy component of 2 percent in 2002, growing to 10 percent in 2010 and 20 percent by 2020
that would include wind, biomass, geothermal, solar, and landfill gas. This standard is similar to the one proposed by
Senators Jeffords and Lieberman in the 106th congress (S. 1369).
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Meanwhile, in the United States, the federal government has set no national target for renewable energy, established no
national cap on greenhouse gas emissions, and refused to create a nationwide trading system for carbon credits. As a result
of the administration's unwillingness to take forceful actions commensurate with the nation's leadership and responsibilities,
the country remains unprepared to face the unprecedented energy and environmental challenges that loom in the future.
Prior to the 1970s, the country faced a similar situation. U.S. regulation consisted of a medley of state laws, local
ordinances, and common law nuisance protections that left significant gaps in the scope and duration of environmental
protection. However, it was generally believed that significant inconsistencies were present in state regulation based on
their relative differences in wealth, knowledge, and interest group pressure. A significant disparity also occurred concerning
the rate at which states adopted environmental regulation-a disparity influenced by trends in population growth, the extent
that environmental services were perceived to have a value in a state's economy, and the revenue that individual states
received from recreational activities such as hunting and fishing.3
Congress responded with an array of environmental statutes-most notably the Clean Air Act (PL 91-604) in 1970 and the
Clean Water Act (PL 92-500) in 1972-to reorient the federal-state relationship in environmental law. Its efforts were largely
inspired by the unappealing prospect of having to live with 50 different state air and water statutes. It was generally agreed
that clean air and water necessitated federal preemption-that is, federal laws needed to trump state laws to provide
regulatory clarity in addressing problems of national magnitude.
Of course, the discussion of federal versus state governance dates back to the country's founding, and debates about
federalism became especially pronounced during the era of the New Deal in the 1930s. The Supreme Court has long fought
to maintain a balancing act, towing the line to create "dual federalism," where the federal government regulates issues of
national import, and the states respond to issues of local import. This balance was believed to help achieve responsive
governance, governmental competition, innovation, participatory democracy, and resistance to tyranny.4
Fast-forward to today, and such roles have oddly been reversed. In what Case Western Reserve University law professor
Jonathan Adler termed a "jurisdictional mismatch," the state and federal governments have seemingly subverted each
other's traditional roles.5 In a "poaching of state and local government territory," national policymakers have preempted
state action concerning drinking water contamination, solid waste disposal, land restoration, and educational standards for
teacher qualification and student performance. 6 Congruously, in what Adler termed "letting fifty flowers bloom,"7 state
and local governments have effectively shut down the national market on bromated flame retardants, adopted international
treaties on human rights, promoted smoking bans in bars and restaurants, and attempted to protect public health by
regulating obesity and red meat.8
Free market advocates have occasionally derided the case for national action on renewable portfolio standards (RPS)- laws
mandating that electricity suppliers use a certain percentage of renewable energy by a particular date. But proponents point
out that these regulations are needed to correct three major market failures in the electric utility industry. First, they argue
that electricity prices do not reflect the social costs of generating power; second, that energy subsidies have created an
unfair market advantage for fossil fuel and nuclear technologies; and third, that renewable energy generation is subject to a
"free rider" phenomenon.9 To gain the transparent and multiple benefits from renewable energy at a larger scale, bold
federal action is essential. It is true that some states and regions of the nation are better positioned to exploit renewable
resources, but all regions can exploit some form of renewables, and RPS proposals have been crafted to allow for a large
portfolio of choices at the electricity retail level. Most compelling, under the current state initiatives, renewables will still
only account for 4 percent of national capacity by 2030.
Climate change has been described as a "textbook example of an environmental issue best addressed at the national and
international levels."10 Greenhouse gas emissions are produced around the globe and accumulate in the atmosphere such
that the impacts are not restricted to states, regions, or even countries. When problems are national or international in scale,
the "matching principle" in environmental law suggests that the level of jurisdictional authority should best match the
geographic scale of that very problem. In the case of climate change, this principle calls for national and international
action, not solely local or regional intervention.11
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Water shortages risk becoming more acute in the coming years as climate change alters precipitation patterns. In the
Pacific Northwest, for example, global warming is expected to induce a dramatic loss of snow-pack as more precipitation
falls as rain. As a result, numerous studies have suggested that the hydrology of the region will be fundamentally altered
with increased flood risks in the spring and reductions of snow in the winter. 255 Consequently, power retailers in the
region have expressed concern that large hydroelectric and nuclear facilities will have to be shut down due to lack of
adequate water for electricity generation and cooling.256 During the steamy August of 2006, the record heat sparked
unplanned reactor shutdowns in Michigan and Minnesota as nuclear plant operators scrambled to find enough water to cool
radioactive fuel cores.257
Nuclear power doesn’t reduce fossil fuel emissions – enrichment massively increases them
Sovacool and Cooper, 07 - *Senior Research Fellow for the Virginia Center for Coal and Energy Research and professor
of Government and International Affairs at Virginia Tech AND ** founded the Network for New Energy Choices (NNEC),
a national non- profit organization committed to reforming U.S. energy policy (Benjamin and Chris, Renewing America:
The Case for Federal Leadership on a National Renewable Portfolio Standard (RPS), June,
http://www.newenergychoices.org/dev/uploads/Renewing%20America_NNEC_Final.pdf)
Nuclear energy is not much of an improvement, despite recent claims by the Nuclear Energy Institute (NEI) that nuclear
power is “the Clean Air Energy.” Reprocessing and enriching uranium requires a substantial amount of electricity, often
generated from fossil fuel-fired power plants. Data collected from one uranium enrichment company alone revealed that it
takes a 100- megawatt power plant running for 550 hours to produce the amount of enriched uranium needed to fuel a
1,000 megawatt reactor (of the most efficient design currently available) for one year.302 According to the Washington
Post, two of the nation’s most polluting coal plants (in Ohio and Indiana) produce electricity exclusively for the enrichment
of uranium.303 Because uranium enrichment consumes so much electricity derived from fossil fuels, many nuclear power
plants contribute indirectly, but substantially, to global climate change and do virtually nothing to end U.S. dependence on
foreign oil.
At the reactor site, electricity generation using nuclear technology creates waste water
contaminated with radioactive tritium and other toxic substances that can leak into nearby
groundwater sources. In December 2005, for example, Exelon Corporation reported to
authorities that its Braidwood reactor in Illinois had since 1996 released millions of gallons of
tritium-contaminated waste water into the local watershed, prompting the company to distribute
bottled water to surrounding communities while local drinking water wells were tested for the
pollutant. The incident led to a lawsuit by the Illinois Attorney General and the State Attorney
for Will County who claimed that “Exelon was well aware that tritium increases the risk of
cancer, miscarriages and birth defects and yet they made a conscious decision not to notify the
public of their risk of exposure.”263
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Those are some of the positives, but the need for government action remains. Despite legislation passed by Congress to
encourage the expansion of nuclear power, the implementation of legislative directives at the agency level has often been
out of step with real-world timeframes. The delay in implementing the Loan Guarantee program, for instance, may prevent
new nuclear facilities from coming online as soon as possible because companies may have to delay or cancel their
projects. The NRC also faces a funding shortfall from its budget request that may force it to defer or delay the review of
applications for new projects.
Specifically in nuclear fuel, domestic producers need legislative support to backup the Russian Suspension Agreement
Amendment to ensure that the U.S. government can enforce recently agreed terms that allow measured Russian access to
the U.S. market while permitting our domestic industry time to secure contracts needed to secure financing for new mines
and production facilities. Additionally, near- and medium-term support for the Paducah plant with a contract to enrich
DOE's high-assay tails would ensure that it remains available to meet the needs of domestic utilities past 2012, a period
when the new centrifuge facilities will be starting up operations. As mentioned before, DOE needs to complete its plan for
managing and selling its uranium inventories to provide the market, and specifically miners and enrichers, clarity on how
DOE's inventory will affect supply and demand during the next decade. Finally, any assistance with education, job
development, and infrastructure improvements in the next few years will go a long way to assisting us with creating a
stable, long-term nuclear fuel industry in the United States.
William Durbin: Well, what's interesting here is what I was just talking about. We need a lot more time to develop the
carbon capture and sequestration technologies. We need more time for the coal and nuclear power plants to really start to
come online. That's a seven to ten year window before we start to see that capacity, online. So what can we do in the short
run? Well, an RPS standard will actually help us to begin the process of bringing down CO2 emissions so it can be viewed
upon as a first step, a relatively easy first step. There's a lot of wind projects being proposed, roughly 100,000 megawatts of
wind is being proposed today. That's a significant amount. If we can get some of that capacity built we can start moving
towards mitigating some of those CO2 increases. Not the one answer, but it will help. And when you look at other options
as well, geothermal, solar, etc., those too will help contribute. So it's not a one for one issue. One doesn't replace the other.
They require all in order to try and meet those goals.
Monica Trauzzi: You had mentioned nuclear and clean coal earlier. How would instituting a federal RPS affect these two
industries?
William Durbin: It shouldn't. In the context of a CO2 legislation, it shouldn't really have an effect because it doesn't meet all
of our future capacity needs. It's just a small piece and it can't meet all of the CO2 reductions that we're looking at under the
CO2 legislation. So, from our perspective, we think there's plenty of room at the table for all types of capacity to
participate. We're looking and we need a portfolio approach to meeting these challenging demands.
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The question of whether nuclear power should be eligible for the CDM cannot
be reduced to a simple measurement of carbon dioxide emissions. Nuclear
power technology is fundamentally a military technology that was developed
to build weapons of mass destruction; the spread of nuclear technology
inevitably increases the risk of nuclear proliferation. To pretend that somehow
this can be overlooked because nuclear reactors don’t emit carbon dioxide
would be reckless in the extreme. The above examples indicate clearly that if
nuclear power is included in the CDM, the Kyoto Protocol will fuel nuclear
proliferation in some of the most unstable regions on the planet. Not only
will nuclear power not save the climate, it will bring countries closer to nuclear
confrontation. That is not “clean development”, and it is not a solution to
global warming.
Nuclear proliferation isn't a problem. Rhodes and Beller claim that it's beyond the capability of terrorists to process reactor-
bred plutonium into explosives, and go on to state that, in any case, proliferation would still be a risk even if nuclear power
ceased to exist—as if the size of the risk were immaterial. Yet the link between nuclear power and nuclear bombs has been
well established, by RMI and others (see "A Treaty Whose Time Has Come," summer 1995). The risk of terrorists or rogue
governments turning stolen plutonium into bombs has increased since the breakup of the Soviet Union, while many nations
(Pakistan, India, Iran, Iraq, and North Korea come to mind) have used their civilian nuclear power programs as covers for
making weapons.
Proliferation. The possibility exists that nations wishing to acquire or enhance a nuclear weapons capability will use
commercial nuclear power as a source of technological know-how or nuclear weapons usable material, notably
plutonium. Although this has not proved to be the preferred pathway to nuclear weapons capability, the possession of a
complete nuclear fuel cycle, including enrichment, fuel fabrication, reactor operation, and reprocessing, certainly
moves any nation closer to obtaining such a capability. The key step for achieving nuclear weapons capability is acquisition
of sufficient weapons-usable fissionable material, either high-enriched uranium or plutonium.
Current international safeguards are inadequate; nuclear power expansion will cause proliferation.
Michael Driscoll, Professor of Nuclear Engineering at MIT, et al, 2003 [“The Future of Nuclear Power: An
Interdisciplinary MIT Study,” http://web.mit.edu/nuclearpower]
Proliferation. The current international safeguards regime is inadequate to meet the security challenges of the expanded
nuclear deployment contemplated in the global growth scenario. The reprocessing system now used in Europe, Japan, and
Russia that involves separation and recycling of plutonium presents unwarranted proliferation risks.
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A 15% federal renewable energy portfolio standard (RPS) will reduce natural gas and power costs, but not have a
significant impact on greenhouse gas (GHG) emissions levels, concludes a report from international energy consultants
Wood Mackenzie. The lower RPS will drive down natural gas demand and prices, lower the overall costs of power, but only
lead to a slowing in the growth rate of GHGs, not an absolute reduction from current levels. The report is entitled, The
Impact of a Federal Renewable Portfolio Standard.
Wood Mackenzie analysts posit that a switch to renewable energy will drive down both the demand and price of natural
gas. Renewable energy in this case is defined as wind, solar, landfill gas, biomass, and small hydro power. "Lower natural
gas prices also reduce the total value of other generation technologies, particularly coal and nuclear capacity, potentially
impacting the value of transactions involving existing generating assets." "The lower fuel costs and fossil fuel consumption
will lead to lower electricity costs," according to Joe Sannicandro. "Over the next 20 years, the Federal RPS case leads to a
savings of $240 billion (2006 dollars) in wholesale power costs, outweighing the higher capital investment to build the
additional capacity."
Recent RPS proposals in Congress call for an average of 15% of power generation to come from renewable sources within
the next two decades, up from 6% today. While the U.S. Congress contemplates a federal standard, 24 states have already
adopted legislation mandating targets for renewables.
According to analysts Sannicandro and Michael Pickens, "currently, the U.S. power sector produces 39% of the country's
total CO2 emissions. Our study shows that a Federal RPS would be only one small piece in a large and complicated puzzle
to halt the growth of or reduce the absolute level of CO2 emissions."
The study shows that implementing the Federal RPS would reduce total domestic CO2 levels in 2025 by only 10% from the
Wood Mackenzie base case. Equally important, the growth rate in CO2 production is still a positive 0.8% per year under a
Federal RPS compared with a growth rate of 1.2% per year in Wood Mackenzie's base case outlook. "Clearly, a reduction in
total CO2 levels will require other options to be implemented including nuclear power, integrated gasification combined-
cycle (IGCC) with carbon sequestration and demand-side approaches to reduce the growth rate of electricity consumption."
ENDI 08 94
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A 20 percent by 2020 federal RPS would decrease consumer energy bills by an average of 1.5 percent per year, and save
consumers in ever region billions of dollars:
- West South Central: $13.3 billion
- East North Central: $8.4 billion
- California: $6.0 billion
- Mid-Atlantic: $5.7 billion
- Mountain: $5.0 billion
- South Atlantic: $2.9 billion
- Northwest: $2.6 billion
- West North Central: $2.2 billion
- East South Central: $1.6 billion
- New England: $1.4 billion
• Larger economies of scale decrease costs 20% to 60%.
A national RPS by 2020 could lower construction costs for wind turbines by more than 20 percent and decrease the cost of
biomass generators by nearly 60 percent.
• Lower natural gas prices save consumers $10 to $40 billion.
Renewable generation offsets natural gas combustion. A 1 percent decrease in natural gas demand can reduce the price of
natural gas by up to 2.5 percent. Nine of fifteen studies found that a national RPS would save consumers $10 to $40 billion
in natural gas expenditures.
• Higher RPS targets save utilities 0.4 to 0.6 cents per kWh.
Renewable resources can serve as a “hedge” against the financial risks associated with volatility in the natural gas market.
The value of this “hedge benefit” increases as the percent of the RPS mandate increases.
• Uniform rules for trading renewable energy credits (RECs) save utilities $14 billion.
By eliminating geographical barriers, a national REC trading system would increase market volume and provide a
predictable rate of return for investors. A federal RPS with a nationwide REC trading system saves utilities $14 billion
compared to an RPS without national REC trading.
ENDI 08 95
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In March 2007, the Lawrence Berkeley National Laboratory (LBNL) released the most comprehensive and rigorous
analysis ever conducted of the economic impact of state-based RPS policies. Researchers analyzed the results of 28
different state or utility-level RPS cost impact projections since 1998. Together, these projections modeled proposed or
adopted RPS policies in 18 different states.
LBNL concluded that the long-term rate impacts of state RPS policies were projected to be relatively modest. 19 of the 28
state cost studies predicted rate increases of no greater than 1 percent, and only two of the 28 studies projected increases of
greater than 5 percent. Six of the studies, in fact, projected rate decreases. LBNL calculated that the median impact on a
monthly residential electric bill would be 38 cents. When combined with projected natural gas savings, the overall cost
impacts of state-based RPS policies are even more modest, resulting in net consumer savings in at least seven of the
cases.45
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Congressional proponents of the Proposed RPS (and most versions of an RPS) cite several goals, including: reduced
pollution, improved national [*56] security, job creation, and lower consumer prices. n44 Additionally, a national program,
rather than a state-by-state program, is more likely to provide a strong national market, thus leading to more renewable
energy projects. n45
In May 2007, the House Committee on Energy and Commerce sent a letter to more than forty "interested parties" from
varying constituent groups inviting responses to several questions regarding a possible renewable energy portfolio standard.
n46 Not surprisingly, the constituent groups supporting an RPS emphasized these key areas in their responses. n47 One of
the broader descriptions of the potential benefits of a national RPS can be found in the Union of Concerned Scientists'
response, which stated that a national RPS "standard can provide many benefits for the nation, including increasing energy
security, fuel diversity, price stability, jobs, farm and ranch income, tax revenues, technology development, customer
choices, and reduced environmental impacts, water consumption, and resource depletion, as well as reduced compliance
costs with current and future environmental regulations." n48
If the claimed benefits are accurate (and, as noted below, there are many who believe they are not), there are several ways
in which these benefits would be achieved. Probably the most obvious would be the potential environmental benefits. n49
Although electricity accounts for less than 3% of U.S. economic activity, "the burning of coal, oil, and natural gas for
power currently accounts for more than 26 percent of smog-producing nitrogen oxide emissions, one-third of toxic mercury
emissions, and 64 percent of acid rain-causing SO<2> [*57] emissions." n50 One expert has asserted that if "20 percent of
our electricity in 2020 were to be provided by renewables, then we would be displacing the equivalent of 71 million cars
from the nation's highway." n51 Others have noted that the increased use of renewable energy would reduce harmful
emissions or reduce the cost of compliance with requirements to reduce pollution. n52 "And by reducing the need to
extract, transport, and consume fossil fuels, a national RPS would limit the damage done to our water and land and
conserve natural resources for future generations." n53
From a national security perspective, the primary benefit would come from a reduced dependence on foreign energy
supplies, because renewable resources such as wind, sun, and biomass, tend to come from domestic sources. n54 In the
electricity sector, the most significant source would be reduced need for natural gas, which is increasingly coming (in
liquefied form) n55 from overseas. n56 Enormous amounts of natural gas are used for electric generation, including as
much as 90% or more of new electric generation. n57
[*58] A reduction in the use of natural gas would also, by many accounts, lead to lower prices for consumers. A recent
study by Woods Mackenzie, an energy-industry consultancy, indicated that a 15% national RPS would "drive down" the
demand for, and price of, natural gas and "lower the overall price of power." n58 The company found that regardless of
whether a national RPS is implemented, the "United States needs to build 420 GW of capacity over the next twenty years to
replace aging facilities and meet its ever-growing need for electricity." n59 A national RPS would create incentives
ensuring, essentially requiring, that some of that new generation be fueled by renewable sources. This switch, according to
the Woods MacKenzie study, to renewable generation sources would lower fuel costs and reduce fossil fuel consumption,
leading to lower electricity costs, amounting to approximately $ 100 billion in savings. n60
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In February, 2007, EIA researcher Andy Kydes published the results of his analysis of the
market impact of a federal RPS of 20 percent by 2020.41 Kydes found that a 20 percent national
RPS would have a relatively mild affect on electricity prices, projecting rate increases of no more
than 3 percent higher than the reference case.42
Many of Kyde’s assumptions caused his analysis to underestimate
the cost savings of a national RPS.
For example, Kydes assumed that the penetration of renewable energy technologies induced by a
federal RPS would offset the construction of hyper-efficient integrated gasification combined
cycle (IGCC) power plants rather than far less efficient conventional coal-fired plants. This
assumption seems remarkably optimistic considering the immaturity of IGCC technology. For
example, while defending TXU’s plan to build 11 new conventional coal-fired units in Texas,
one TXU VP noted:
IGCC is a promising technology, but is not yet viable on a large-scale commercial basis
for the types of coal available in Texas. There are only two IGCC units in operation
today in the U.S. – both are small, were heavily subsidized, and actually have dirtier
emissions profiles than the supercritical plants we have proposed. Further, both these
plants continue to operate at low reliability levels more than five years after coming on
line.43
In practice, therefore, RPS-induced renewable energy systems are for more likely to offset
traditional coal-fired power plants that produce far less energy per ton of coal and generate far
more pollutants and carbon emissions than the units Kyde’s analysis assumed.
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Large-scale production of renewable energy induced by a federal RPS could also decrease costs, according to the
"Renewable America" report, which points to wind power as an example.
When the Department of Energy installed its first commercial wind turbines in 1980, wind energy cost about 81 cents per
kilowatt-hour. By 2004, when the wind turbine capacity had increased from a few megawatts to 6,000, the cost fell to 5
cents per kilowatt-hour.
Some utility companies are pushing for a federal RPS precisely because of this rationale, including Alliant Energy, a power
company with its headquarters in Wisconsin.
"We believe that a national RPS would help to create a floor for renewables and give us and the wind turbine industry a
greater level of certainty," said Scott Smith, spokesman for Alliant, which just received approval to build its first wind farm.
"Instead of a boom-and-bust cycle, it will help to solidify the demand which will create a robust market."
The implications of a national RPS may not be quite as burdensome as they initially appear, however, because, many states
have RPS programs already, and, as explained below, even those operating in non-RPS states are often served by
organizations, e.g., Regional Transmission Operators (RTOs) and Independent System Operators (ISOs), n112 with the
expertise necessary to facilitate compliance. Nonetheless, it is retail electricity suppliers that would bear the greatest burden
of a nationally imposed RPS, because they would need to participate in facilitating compliance, as well as facilitating the
renewable generation market.
For covered utilities operating only in non-RPS states, a federal mandate would mean initiating a new program for tracking
and reporting RECs. As such, it does appear that it would be more burdensome for such facilities because it would require
setting up a process to deal with RECs in the first place. For those utilities that already track RECs for state compliance, the
adaptability of many of the RECs tracking systems should make compliance with the additional federal requirement less
burdensome and more straightforward than it would be otherwise.