EIA: State renewables targets
to account for 10% of electricity sales by 2025
By
Michael Copley
States are expected to continue meeting or exceeding the targets
contained in their renewable energy portfolio standards, with a surplus
of qualifying capacity increasing "substantially" by 2040 as renewable
power technologies "become increasingly competitive with conventional
generation sources," according to the U.S. Energy Information
Administration.
The
projection, contained in the EIA's "Annual Energy Outlook 2013," noted
RPS variations among the states and said the aggregate targets "may mask
significant regional variation, with some regions producing excess
qualifying generation and others producing just enough to meet the
requirement or even needing to import generation from adjoining regions
to meet state targets."
According to the EIA, surplus renewable energy — the level of installed
capacity above the amount required by RPS — is expected to decline
through the next decade as less qualifying capacity is added and energy
targets catch up to supply. However, the surplus is expected to widen
beginning in about 2032 as renewables technology becomes competitive
with conventional generation, the agency said in the outlook, released
April 15.
A
surplus of renewable power, though, does not mean that state renewable
energy mandates are unnecessary, the EIA said. "Just because there is,
in aggregate, more qualifying generation than is needed to meet the
targets, this does not necessarily imply that projected generation would
be the same without state RPS policies," it said. "State RPS policies
may encourage investment in places where it otherwise would not occur,
or would not occur in the amounts projected, even as other parts of the
country see substantial growth above state targets."
However, the EIA noted that a surplus does suggest that state RPS
programs "will not be the sole reason for future growth in renewable
generation." Aggregate state targets will account for 10% of U.S.
electricity sales in 2025, according to the outlook.
Favorable environment for RPS compliance
A
confluence of factors is fostering RPS compliance among the states, the
EIA found, including a surge in RPS-qualified capacity that was
Timed
to take advantage of federal incentives, like the production tax credit,
which was extended for one year in January; reductions in the cost of
renewable technology; and "generally reduced" electricity sales. Since
most RPS targets are tied to retail electricity sales, slow sales growth
means renewable generation that entered service recently goes further
toward meeting the proportionally lower targets, it said.
The
short-term availability of federal incentives, as well as declining
equipment costs for wind turbines and solar PV systems, also has helped
make renewable power projects more attractive to investors, the EIA
said.
No
new RPS programs were enacted in 2012, though the EIA outlook does note
modifications that were made in several states to existing regulations.
Maryland, which requires utilities to get 20% of their power from
renewable sources by 2020, enacted a series of bills that accelerate the
state's solar-specific compliance schedule.
State-level renewable power mandates have recently come under
attack from lawmakers and others who
say the requirements prop up the renewable energy industry at
ratepayers' expense.
American Wind Energy Association interim CEO Rob Gramlich
acknowledged the pushback during a webcast April 11. While
none of those efforts has had any impact so far, he said, the trend is
worth keeping an eye on.
|