This document by Professor Robert J. Michaels and published in Energy Law Journal provides an economist's perspective on a National Renewable Portfolio Standard as considered by the U.S. Government. The synopsis of the document appears below. The full paper can be downloaded by clicking on one of the links below.

Synopsis: Concern over emissions and climate change has led over half of the states to enact "renewable portfolio standard" (RPS) legislation requiring regulated electric utilities to obtain some fraction of their power requirements from sources defined as "renewable." Legislation to institute a federal RPS may follow. In reality, RPS is a policy in search of a rationale, at odds with principles of efficient environmental regulation and poorly suited to promote other policies favored by its supporters. The actual record of state implementations has been largely symbolic. Very few states with binding RPS requirements are currently in compliance with their own programs, and a federal RPS will be subject to the same forces that have led to state-level failure. The recent history of renewables leads to a conclusion that existing and proposed mandates are better viewed as special interest legislation than as rational responses to climate change and fossil-fuel power plant emissions.

Table of Contents

I.Introduction

II. Renewables Today
A. Types of Renewables
B. Sources of Electricity
C. The Coming Costs

III. A National RPS as EnvironmentalPolicy
A. Efficient EnvironmentalRegulation
B. RPS and Emissions
C. Efficiency Through Time

IV. Other Rationales for a National RPS
A. RPS as Macroeconomic Policy
B. RPS as Technology Policy and Foreign Policy
C. RPS as Risk Management Policy
1. Renewable Energy Credits
2. Diversification and Risk
3. National Security

V. The Effects of a National RPS
A. Data and Assumptions
B. NEMS
C. Some Scenarios
1. Business as Usual and Beyond
2. RPS, Emissions and Wind
3. The Economics of Falling Gas Prices

VI. State RPS Experiences
A. Why Examine the States?
B. Some State Experiences
C. California: Gestures and Strategies
1. How Large a Shortfall?
2. Why the Lack of Compliance?
E. The Federal Alternative

Web link: http://www.eba-net.org/docs/elj291/national_renewa...

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