Thursday, June 4, 2015

Renewable Portfolio Standards are Effective and Politically Popular

By Nick Lawton, Staff Attorney

A solid majority of Americans favors government mandates for renewable energy development, according to a new study by the University of Michigan’s National Surveys on Energy and the Environment. The study found that 74% of Americans “agree that state governments should require a set portion of all electricity to come from renewable energy sources such as wind and solar power.” In short, the study reveals that despite the political turmoil around Renewable Portfolio Standards (RPSs), these effective, economically efficient policies enjoy strong support from the American people.

However, many Americans do not actually know what policies are already in place. Of those surveyed, 59% did not know whether their state had an RPS in place, and . of the 41% who claimed knowledge of their state’s policies, “only half answered correctly.” The survey thus reveals a lack of effective communication from governments and the renewable energy industry about existing policies.

The survey also revealed that support for RPSs depends strongly on their perceived costs. In the absence of information about costs, 74% of respondents support RPSs. If respondents were told that RPS policies increase electricity bills by $25 per year, only 58% were in support. And if told that RPS policies increased rates by $50 per year, only 45% were in support. In reality, the average cost premium of RPS policies is roughly $15 per year, and the average utility bill increase from an RPS policy is under 3%, which is the average national rate increase even in states that lack these policies.  Since RPS policies do not raise rates beyond business as usual, a majority should support these policies

This study should also undermine the political campaign against RPSs that is underway in many states—assuming politicians respond to popular will rather than special interests. Kansas recently rescinded its mandatory RPS, instead opting for an aspirational target. The RPS in Texas narrowly survived the legislative session. West Virginia and Ohio repealed and froze their RPS requirements, respectively, in the past year. The movement against RPSs does not, it appear, represent the will of the people.

Success stories around RPSs are mounting as well. A new report from Clean Edge reveals that Iowa, Kansas, and South Dakota generated more than 20% of their energy from wind power in 2014. Each of these states has a RPS, although South Dakota’s is aspirational and Kansas’s just lost its legally binding status. Meanwhile, California became the first state to reach 5% solar power in 2014, also driven by an RPS.

This progress and the University of Michigan survey suggest that effective communication is essential for more renewable power deployment. RPSs clearly work well, but many citizens do not know that they are even in place. Moreover, renewable energy advocates are working against a misinformation campaign. The renewable energy industry’s best bet for improving the situation is effective communication of accurate information.


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