California Governor Jerry Brown Proposes Significant RPS Expansion

By Nick Lawton, Staff Attorney

During his inaugural address on January 5, 2015, California Governor Jerry Brown announced three important goals for the state’s energy portfolio. Governor Brown framed these goals as part of an effort to mitigate climate change and quoted famed biologist E.O. Wilson’s description of the fight against climate change as a “moral precept we can agree on.” Governor Brown noted California’s existing leadership on climate policies, asserting that California has “the most integrated policy to deal with climate change of any political jurisdiction in the Western Hemisphere.” However, Governor Brown was not content to rest on these laurels, noting that “[t]hese efforts, impressive though they are, are not enough.” Setting his sights on progress to be made in the next fifteen years, Governor Brown announced these three goals:

Increase from one-third to 50 percent our electricity derived from renewable sources;

Reduce today’s petroleum use in cars and trucks by up to 50 percent;

Double the efficiency of existing buildings and make heating fuels cleaner.

Although each goal is important and laudable, this post focuses on the proposal to expand California’s Renewable Portfolio Standard (RPS), because this proposal poises California to demonstrate the viability of expanding this type of affordable, effective renewable energy policy.

Many states have Renewable Portfolio Standards, but few are as ambitious as California’s current requirement of obtaining 33% of its energy from renewable resources by 2020. Most states require less renewable energy and provide more time to develop it. Governor Brown’s proposal would give California the most ambitious RPS in the nation, surpassing Hawaii’s current target of 40% renewable energy by 2030.

Governor Brown’s proposal to expand California’s RPS into the nation’s most ambitious renewable energy policy is a good idea because it will likely prove attainable and affordable. California is already on-track to meeting its current RPS targets, as Governor Brown noted in his address. Most other states are also meeting their RPS targets as well, demonstrating that achieving substantial renewable energy development is within reach. Moreover, as the National Renewable Energy Laboratory reported in 2012, current renewable energy technologies are sufficient to meet 80% of U.S. energy demand by 2050 without compromising grid reliability. This study and the history of successful RPS implementation throughout the nation suggest that California can achieve Governor Brown’s goal of 50% renewable energy by 2050.

Second, Governor Brown’s proposal will likely prove affordable. Lawrence Berkeley National Laboratory reported in late 2013 that Renewable Portfolio Standards have generally had modest impacts on electricity rates, seldom raising rates more than 2%. In contrast, the U.S. Energy Information Administration expects residential electricity rates to rise roughly 3% in 2015. Similarly, Brennan Louw at Renewable Energy World reported in late 2011 that the five states with the highest levels of solar and wind power had actually seen their electricity rates increase more slowly than the U.S. average or than states with the least renewable energy. All these facts suggest that expanding California’s Renewable Portfolio Standard will prove a sound investment.

Finally, Governor Brown’s proposal is important because it provides a counterpoint to efforts to freeze or repeal Renewable Portfolio Standards in several states. The American Legislative Exchange Council, a radically conservative advocacy group funded by the Koch Brothers and large corporations, has been spearheading this effort since 2012, when it developed a template for repealing renewable energy standards. The effort has had only limited success. Although Ohio froze its RPS requirements last year, the repeal movement largely failed in 2013 and 2014. Clare Foran at the National Journal has written an excellent article explaining the RPS repeal movement and the reasons for its general lack of success. Ms. Foran attributes the failure of the RPS repeal movement largely to Republican state legislators who support RPSs because they create jobs. This is likely true. Renewable Portfolio Standards do create large numbers of jobs, as the Natural Resources Defense Council and Mindy Lubber at Forbes both report.

But the broader point is that Renewable Portfolio Standards are good policy for the economy and the environment. Critics attack RPSs with misinformation (such as false claims about their impacts on electricity rates) and outright vitriol (including characterizing RPSs as “the crack cocaine of subsidies”), but in reality RPSs have proven effective and economically efficient. Governor Brown’s proposal to expand California’s RPS is precisely the kind of pragmatic, realistic policy that the U.S. energy market needs. It prepares California to continue its strong history of leadership in renewable energy development and to show other states that RPSs are viable policies to promote abundant and affordable renewable energy.