Renewable Portfolio Standards Examined
Jobs is a selling point
Just after the 2008 presidential election, a national mandate for utilities to obtain a fixed percentage of their electricity from renewable energy seemed almost inevitable.
After all, pro-renewables Democrats controlled Washington, more than two dozen states had a mandate and clean energy development was starting to be seen as a way out of the economic slide that had just gained steam, with no end in sight.
Quite a bit has changed in three years. National mandates are rarely discussed, the movement to add to the list of states has trickled to a crawl, and many proponents of the policy have been forced to defend existing requirements, or fend off rollbacks or repeals. Even the green jobs movement has lost some appeal with recent bankruptcies in the clean energy sector.
Today, 29 states and Washington have renewable portfolio standards and another five states have non-binding goals. The standard creates local demand, which has led to manufacturing and support companies setting up shop in the industrial heartland.
Just in those renewable standards states, the market could exceed 115 gigawatts of generation by 2025, some observers note. The Union of Concerned Scientists estimates a renewable energy standard of 30 percent by 2030 would lead to 63,000 megawatts of non-hydro capacity development in the Midwest, up from the current 13,000 megawatts.
California is one of the few places where the standard has been increased in the past year, with the legislature adopting the standard of 33 percent of electricity from renewable sources by 2020. It failed to reach a previous interim benchmark of 20 percent by 2010, now pushed back to 2013, but the utilities are getting closer, with most rates in the high teens.
Most states are on schedule to meet the requirements of low, single-digit percentages that existed in 2011.
But in places like wind-rich Iowa -- which is ahead of schedule and is far and away the national leader, by percentage, in the amount of clean energy it produces -- wind supplied more than 15 percent of electricity generation in 2010 and industry and state officials say the total is 20 percent this year.
The state is now a wind powerhouse, trailing only Texas in installed capacity. It surpassed the former leader, California, a few years ago and now has 3,675 megawatts, with another 619 megawatts under construction, according to the American Wind Energy Association.
Iowa appears to be the laboratory model that renewable energy proponents say the country should adopt for the emerging green economy: policy support that encouraged a remaking of the electricity marketplace, which, in turn, attracted a domestic manufacturing base to serve the new energy economy.
The state had a head start -- though by modern standards, a rather modest one -- that was probably revolutionary for the time. Iowa had the first renewable portfolio standard in the United States, a mere 2 percent, but the date is significant because it was all the way back in 1983.
A high-profile result of late is the 700 manufacturing jobs at the TPI Composites wind blade plant in Newton, Iowa, which was formerly the headquarters for Maytag before those jobs moved overseas.
Now, Iowa claims over 200 wind-related businesses currently operate in 55 Iowa counties and add $5 billion to the Iowa economy.
Colorado, meanwhile, first passed a requirement by ballot initiative in 2004, but legislators have twice increased the percentage. That led to Danish turbine maker Vestas to locate three plants there that employ about 2,000 and supply its North American customer base.
"The supply chain in the United States is such a success story over the last six or seven years due to the growth of the wind industry. So much more is now being manufactured here, along with the services around wind development and maintenance," said Susan Williams Sloan, director of state relations for the AWEA, who says total employment tied to wind energy is 85,000.
Due to the nature of their technologies, larger-scale investments occur in wind manufacturing, while solar development tends to be labor-intensive. Small rooftop installations, with small companies blossoming to fill the void, rule the day.
Opponents of mandates from New England to the Southwest have made numerous attempts to scale back the requirements. Outright assaults have failed. Still, proponents of renewables failed yet again to get a mandate passed in Indiana, having to be content with a voluntary goal of 10 percent by 2025.
Generally speaking, the green jobs push is what is saving the effort so far. It’s been tough the last few years and that’s something that won’t likely change much.