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Perspective

Congress should not impose a federal renewable portfolio standard (RPS).
Fortnightly Magazine - August 2004

but restricts plant ownership by electric utilities.

State Quotas

The states have experimented with green power quotas for years. Consistent with the observation of Justice Louis D. Brandeis that the 50 states have provided the laboratories for social and economic experiments, 14 states since 1997 have adopted an RPS in some form. 1x Each RPS reflects the distinctive characteristics of the state in which it is was adopted.

In Arizona, 0.8 percent of the electric power sold in the state this year must be derived from renewable resources. In addition, 50 percent of this green power must be generated from solar panels. Next year, the overall requirement increases to 1 percent and the solar requirement increases to 60 percent.

In Nevada, 5 percent of the electric power sold in the state this year must be green power, and 5 percent of this green power must be generated from solar panels. The overall requirement increases to 7 percent next year and to 15 percent by 2013.

In New Mexico, 5 percent of the electric power sold in 2006 in the state also must be derived from renewable resources. For purposes of compliance with this quota, the generation of 1 kWh from windmills or hydroelectric facilities is worth 1 kWh of green power, the generation of 1 kWh from facilities that burn biomass or from geothermal resources is worth 2 kWh in green power, and the generation of power from solar panels is worth 3 kWh in green power.

This premium on green power from solar panels is not reflected in New England quotas, which often exclude power from hydroelectric facilities developed long ago in the Northeast.

In Connecticut, the 1 percent quota in 2004 includes green power from windmills and solar panels, but it excludes power from hydroelectric facilities.

In Massachusetts, the 1.5 percent quota in 2004 for green power from facilities constructed after 1999 includes power from windmills and solar panels and from facilities that burn biomass, but it excludes power from hydroelectric facilities.

Although the Maine RPS includes hydroelectric power, the state green-power quota is 30 percent. This figure reflects the broad development of hydroelectric resources in the state prior to the 1997 adoption of the green-power quota.

Federal RPS Proposals

The adoption of an RPS by more than a dozen states has inspired and contributed in no small measure to proposals for a federal green-power quota. Indeed, each Congress since 1997 has debated the merits of a federal RPS.

In 1997, Rep. Dan Schaefer, D-Colo., introduced a House bill (H.R. 655) to restructure electric power markets. The bill also would have established a federal RPS of 2 percent for 2004. Sen. Dale Bumpers, D-Ark., also introduced a bill (S. 237) to restructure electric markets , which would have established an RPS of 5 percent for 2004.

In 1998, the Clinton administration proposed an electric competition bill (S. 2287) that would have required 5.5 percent of the electric power sold between 2010 and 2015 to be green power. No major energy bill, however, was enacted in the 105th Congress.

The