Standards: 2017 Annual Status Report Hosted by Warren Leon, - PowerPoint PPT Presentation

RPS Collaborative Webinar U.S. Renewables Portfolio Standards: 2017 Annual Status Report Hosted by Warren Leon, Executive Director, CESA September 6, 2017

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RPS Collaborative • With funding from the Energy Foundation and the US Department of Energy, CESA facilitates the Collaborative . • Includes state RPS administrators , federal agency representatives , and other stakeholders. • Advances dialogue and learning about RPS programs by examining the challenges and potential solutions for successful implementation of state RPS programs, including identification of best practices . • To sign up for the Collaborative listserv to get the monthly newsletter and announcements of upcoming events , see: www.cesa.org/projects/renewable-portfolio-standards

Guest Speaker • Galen Barbose , Research Scientist, Electricity Markets and Policy Group, Lawrence Berkeley National Laboratory

U.S. Renewables Portfolio Standards 2017 Annual Status Report Galen Barbose Lawrence Berkeley National Laboratory CESA RPS Collaborative Webinar September 6, 2017 This work was funded by the Office of Electricity Delivery and Energy Reliability (Transmission Permitting & Technical Assistance Division) of the U.S. Department of Energy under Contract No. DE-AC02-05CH11231.

Table of Contents • Evolution of state RPS programs • Historical impacts on renewables development • Future RPS demand and incremental needs • RPS target achievement to-date • REC pricing trends • RPS compliance costs and cost caps • Outlook 2

RPS Policies Exist in 29 States and DC Apply to 56% of Total U.S. Retail Electricity Sales MN: 26.5% by 2025 WA: 15% by 2020 ME: 40% by 2017 MT: 15% by 2015 Xcel: 31.5% by 2020 NH: 24.8% by 2025 VT: 75% by 2032 MI: 15% by 2021 MA: 11.1% by 2009 +1%/yr OR: 50% by 2040 (large IOUs) WI: 10% by 2015 NY: 50% by 2030 RI: 38.5% by 2035 5-25% by 2025 (other utilities) PA: 8.5% by 2020 CT: 23% by 2020 NV: 25% by 2025 IA: 105 MW by 1999 NJ: 22.5% by 2020 DE: 25% by 2025 IL: 25% by 2025 OH: 12.5% by 2026 DC: 50% by 2032 MD: 25% by 2020 CO: 30% by 2020 (IOUs) MO: 15% by 2021 CA: 50% by 2030 20% by 2020 (co-ops) 10% by 2020 (munis) NC: 12.5% by 2021 (IOUs) 10% by 2018 (co-ops and munis) AZ: 15% by 2025 NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) Source: Berkeley Lab (July 2017) Notes: In addition to the RPS policies shown on TX: 5,880 MW by 2015 this map, voluntary renewable energy goals exist in a number of U.S. states, and both mandatory RPS policies and non-binding goals exist among U.S. territories (American Samoa, Guam, Puerto Rico, US Virgin Islands). HI: 100% by 2045 3

Most RPS Policies Have Been in Place for at Least 10 Years States continue to make regular and significant revisions Year of RPS Enactment CO HI IL MA CT MD DC NH MI ME PA NJ NY DE NC MO IA MN AZ NV WI TX NM CA RI MT WA OR OH KS VT 1983 1991 1994 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 IA MN AZ MN NM CT NJ CT AZ CA DC HI CO CA MA CO IL CA DC MA WI NV MN NM CO CA CO DE IL DE CT MD CT MA CT IL MD NV PA NV CT CT HI ME IL DC NJ MD OH HI MA TX HI DE MA MN MA DE NH MN OR KS MI NJ MD MD NV MD IL NM MT WI VT NY WI ME NJ OR NJ MA NY NM OR MN RI NY MD OH NV RI Year of Major Revisions NJ NC NM WI Source: Berkeley Lab PA Current as of July 2017 TX 4

General Trends in RPS Revisions Increase and extension of RPS targets: More than half of all RPS states have raised their overall RPS targets or carve-outs since initial RPS adoption; many in recent years Creation of resource-specific carve-outs: Solar and DG carve-outs are most common (18 states + D.C.), often added onto an existing RPS Long-term contracting programs: Often aimed at regulated distribution utilities in competitive retail markets; sometimes target solar/DG specifically Refining resource eligibility rules: Particularly for hydro and biomass, e.g., related to project size, eligible feedstock, repowered facilities Loosening geographic preferences or restrictions: Sometimes motivated by concerns about Commerce Clause challenges or to facilitate lower-cost compliance In addition, although many states have introduced bills to repeal, reduce, or freeze their RPS programs, only two (OH, KS) have thus far been enacted 5

RPS Legislation and Other Revisions in 2016 and 2017-to-date Most proposals sought to strengthen or make small technical changes RPS-Related Bills Introduced and Enacted in 2016 & 2017 Contrasts to previous years Strengthen Weaken Neutral Total with more prevalent efforts Introduced 96 51 81 228 to repeal or weaken RPS Enacted 13 3 17 33 requirements Data Source: EQ Research (August 31, 2017) Notes: Includes legislation from 2016 sessions and from 2015-2016 sessions active in 2016, as well as legislation active in 2017 sessions. Companion bills are counted as a single bill. Major RPS revisions (legislative and administrative) made in 2016 and 2017-to-date: – DC: Increased and extended RPS to 50% by 2032 – IL: Created requirements for “new” solar and wind, with additional carve -outs; IPA takes over procurement for retail suppliers – MA: Created requirements for off-shore wind (1,600 MW by 2027) and new solar procurement program (1,600 MW) – MD: Increased and accelerated RPS to 25% by 2020 – MI: Increased and extended RPS to 15% by 2021 – NY: Increased and extended RPS to 50% by 2030, and expanded coverage statewide – OR: Increased and extended RPS to 50% by 2040 for large IOUs – RI: Increased and extended RPS to 38.5% by 2035 6

Table of Contents • Evolution of state RPS programs • Historical impacts on renewables development • Future RPS demand and incremental needs • RPS target achievement to-date • REC pricing trends • RPS compliance costs and cost caps • Outlook 7

RPS Policies Have Been One Key Driver for RE Generation Growth RPS requirements constitute ~50% of total U.S. RE growth since 2000 • Total non-hydro RE generation in the U.S. grew Growth in Non-Hydro Renewable Generation: 2000-2016 by 283 TWh from 2000-2016 – Many factors contributed to that growth (tax 300 283 credits, other incentives, cost declines, etc.) 250 • RPS policies required 146 TWh increase over 200 that period 146 TWh Actual Growth in Total 150 – Not strict attribution: some of that would have U.S. Non-Hydro RE occurred without RPS Generation Since 2000 100 • Additional RE growth associated with: Minimum Growth 50 Required for RPS – Economic utility purchases 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 – Corporate procurement and other voluntary green power markets Notes: Minimum Growth Required for RPS excludes contributions to RPS compliance from pre-2000 vintage facilities, and from hydro, municipal solid waste, and non-RE – Accelerated RPS procurement technologies. This comparison focuses on non-hydro RE, because RPS rules typically allow only limited forms hydro for compliance. 8

RPS Role in Driving RE Growth Varies by Region Seemingly most critical in the Northeast, Mid-Atlantic, West Growth in Non-Hydro Renewable Northeast, Mid-Atlantic, West Generation: 2000-2016 – Actual RE growth closely matches RPS needs 100 – Northeast and Mid-Atlantic rely, to some degree, on Actual Growth in Total Non-Hydro RE 90 RECs from neighboring regions to meet compliance Min. Growth Required for RPS 80 obligations 70 Texas and the Midwest 60 TWh – Actual RE growth far outpaced RPS needs, given 50 40 favorable wind energy capacity factors/economics 30 in those regions 20 Southeast 10 – Minimal RE growth or RPS demand, with just a 0 Northeast Mid-Atlantic West Texas Midwest Southeast single RPS state (North Carolina) Notes: Northeast consists of New England states plus New York. Actual growth shown for that region is estimated based on new RE capacity that meets the vintage requirements for RPS eligibility. Mid-Atlantic consists of states that are primarily within PJM (in terms of load served). 9