States Take the Climate Change Lead With Renewable Portfolio Standards

While Congress and the EPA have struggled with a federal program to reduce greenhouse gas (GHG) emissions, a majority of the states have moved ahead with programs intended to cut GHGs by increasing the use of alternative energy sources, such as wind and solar.

So-called Renewable Portfolio Standards (RPS) or goals are in effect in 33 states plus Washington, D.C. The standards set a deadline by which electric utilities must generate a specified percentage of their power from renewable energy sources. The percentages and dates vary--for example, Michigan requires that utilities generate 10 percent of their power from renewable sources by 2015, while Connecticut requires 27 percent from renewables by 2020. The definition of what constitutes a renewable source also varies by state.

Mark Bennett, senior counsel at Miller Canfield, says these standards have the same goal as cap and trade and carbon tax proposals that have been the focus of media and Congressional attention--reducing greenhouse gases--but go at it from a different angle.

"They are not mandates to reduce emissions, they are mandates to move away from traditional fuel sources," says Bennett.

One reason renewable standards have proliferated is that they promote the development of green jobs.

"RPS is popular amongst the governors because wind and solar manufacturers tend to locate where demand is high because of the logistics of shipping," Bennett says.

For example, this year Gov. Bill Ritter urged the Colorado legislature to "think bigger" and increase the state's RPS to 30 percent by 2020 from the current 20 percent. The higher standard, he said, would "trigger the creation of tens of thousands of new jobs" because of increased demand for solar, wind, biomass, hyro and geothermal power.

Bennett sees the possibility of a national RPS standard if Congress fails to act on a comprehensive climate change bill.

"The administration may save face by negotiating a national RPS," he says.

But RPS is hardly free from legal complications. Bennett points out that a national renewables standard would create pre-emption issues in the states that have a different "rate and date" already in place.

And even the universally desired goal of creating clean energy jobs faces legal challenges when it gets down to building a solar plant or wind farm.

"Even green energy has to go through the permitting process and public participation," says Ronald Baylor, a principal at Miller Canfield. "There will be tension for some time while the infrastructure is put into place. No one wants a wind farm in their backyard."

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