ISSUE BRIEF: Promoting Renewable Energy
Support incentives over production mandates
The Issue:
With domestic energy demands on the rise, renewable energy sources are becoming an increasingly important contributor to the nation's fuel mix. However, renewable energy constitutes just one element of a balanced fuel portfolio: clean coal, natural gas, nuclear and hydro power all are necessary components as well.
In recent years, renewable energy proponents have become aggressive in pursuing State and federal purchase mandates (so-called renewable portfolio standards). In fact, key Members of the Majority Leadership in the 110th Congress have promised a substantial federal purchase mandate will be among their legislative priorities for this Congress. In addition, a number of State portfolio standards are now on the books. Such mandates put energy providers in a difficult spot. They remove the flexibility that providers need to ensure they can reliably provide energy to consumers at the lowest possible price.
There are a variety of policies besides rigid mandates that can be adopted to effectively promote renewable energy production. Production incentives are highly effective and should be made available for all forms of renewable energy, including hydroelectric facilities. Also important is regulatory reform. Because many of the renewable resources in the nation are located in public lands, a streamlined NEPA process would reduce the regulatory costs associated with permitting new renewable generation.
Impacts on the West:
In order to ensure reliability and avoid rate increases to customers, companies need flexibility to determine how best to integrate renewable energy resources into their generation portfolios. The market, not mandates, should decide what economic burdens consumers are asked to pay for renewable sources.
Status of the Issue:
Senate Energy and Natural Resources Committee Chairman Jeff Bingaman has made approval of a federal RPS among his early priorities for the Committee.
Solutions:
- Take 60 seconds to tell your member of congress to oppose any effort in Congress to pass heavy-handed, rigid renewable production mandates. Instead, support a robust set of tax and regulatory incentives for such production. There are many such actions the federal government could take, short of utility purchase mandates, to promote robust renewables development.
- Support Long-term extension of the Section 45 Production Tax Credit for renewable generation projects;
- Increase R&D funding;
- Streamline the permitting processes associated with the siting of transmission lines.
- Increase the goals for renewable purchase by the federal government to meet its energy needs.