A Renewable Portfolio Standard (RPS) ensures that a minimum amount of renewable energy is included in the portfolio of electricity resources serving a state or country, and — by increasing the required amount over time — the RPS can put the electricity industry on a path toward increasing sustainability. Portfolio standards have been primarily a result of state-based electric restructuring efforts but some regulated states enacted renewable energy mandates in the 1990’s – most notably Minnesota, Wisconsin and Iowa. Those have evolved into state RPS policies over time.
None of the exisiting RPS rules is the clear winner as the best or model rule. Arizona’s most recent iteration of an RPS has a special provision that requires onsite generation to provide 30 percent of the energy required under the RPS. Nevada’s RPS has an interesting provision designed to take advantage of their most available renewable resource – the sun – we like that built-in local flavor aspect of an RPS. Some states have substantial percentage goals of 20 percent or more – we like those agressive strategies.
We feel that the following conditions should be met when installing a Renewable Portfolio Standard.
New Rules Project’s RPS Criteria:
- A good RPS will lead to an absolute annual increase in renewable energy generating capacity.
- Over time a good RPS will lead to an increase of installed renewable energy capacity on a per capita basis.
- Qualifying facilities under an RPS should NOT include waste-to-energy facilities (incinerators) or high-head hydopower resources.
Please Note: We are not listing information on all the RPS rules that have been enacted across the country. Some of them are similar to each other and/or weaker than those we have listed. Below you will find a representative sampling of the most interesting of the bunch. For a complete listing of states with RPS laws, we suggest this page at UCS or this page at DSIRE
Iowa's 1983 Alternate Energy Production law required the state's investor-owned utilities to purchase of electricity from renewable energy projects. After years of stalling by the utilities, Iowa is now becoming a leading state for wind energy development.… Read More
The 2007 Minnesota legislature has adopted the strongest renewable energy standard (as of January 2009) that applies to all the state's utilities - 25% renewables by 2025 (30% by 2020 for Xcel Energy) giving a total renewable requirement of about 27.5% of electricity sales by 2025.… Read More
The Arizona Corporate Commission (ACC) adopted an Environmental Portfolio Standard in 2001 that required utilities to have 1.1 percent of sales from renewables by 2007. The program did not work. A new plan was announced in August 2005. The ACC’s new plan will require utilities to procure 15% of the state’s electricity from renewable resources by 2025. The ACC voted to require that 30% of the EPS requirement be met by local onsite renewables installed by homes and businesses.… Read More
On September 12, 2002, a bill was enacted (SB 1078) requiring California to generate 20 percent of its electricity from renewable energy no later than 2017. The law requires sellers of electricity at retail to increase their use of renewable energy by 1 percent per year. In 2005, state regulators expressed a desire to accelerate the timeline and meet the RPS by 2010. The Governor has endorsed this accelerated schedule and has set a goal of achieving a 33 percent RPS by 2020 for the state as a whole.… Read More
Connecticutoriginally passed an RPS law in 1998 but it proved to be flawed. The most recent changes to their RPS legislation was in 2007 and make Connecticut's one of the most agressive in the nation (as of January 2009). The new law requires electricity providers to generate 27% of all retail electricity sales from renewable energy by 2020.
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On June 8, 2001, Nevada enacted the country’s most aggressive renewable portfolio standard at the time. The law required that 15 percent of all electricity generated be derived from new renewables by the year 2013. Five percent of the RPS must be from solar energy projects. In June 2005, Nevada raised the requirements of the RPS to 20 percent of sales by 2015. The bill also allows certain energy efficiency measures to qualify for up to one-quarter of the total standard in any particular year.… Read More
InApril 2006, the New Jersey Board of Public Utilities (BPU) issued new regulations that as a whole requires 22.5 percent renewable energy by 2021. Most interesting is a requirement for photovoltaics to meet 2.12 percent of the state's cosumption - representing about 1,500 MW by 2020.… Read More
In early March 2004, New Mexico Governor Bill Richardson signed into law a measure (SB 43) that requires investor-owned electric utilities to produce or buy increasing amounts of renewable energy. Renewables must make up 5 percent of the utilities' sales by 2006, and 10 percent by the year 2011. The law leaves a tiny hole that would allow utilities to ignore the new law through a provision for a PRC-established"reasonable cost threshold" beyond which a utility would not be required to add renewable energy to its energy supply portfolio.… Read More
In September 2004, The New York State Public Service Commission (PSC)adopted a renewable energy portfolio standard that requires 25 percent of the state's electricity to be supplied from renewable energy sources by 2013. The NY RPS will require about 3,700 megawatts (MW) of new renewable fueled electricity projects to come on-line between 2006 and 2013. The NY RPS also requires a portion of the renewables to come from customer-sited generation.… Read More
In July 2005, the Texas Legislature doubled their previous goal for the amount of wind power, solar power and other forms of renewable energy in the state's energy mix. The new portfolio standard calls for the state to obtain 5,880 MW, or about five percent of the state's electricity, from renewable energy by 2015. Of the total, 500 MW must come from renewable energy sources other than wind energy.… Read More