“State’s Rights” Prevail: How state renewable energy policy is combating climate change

“State’s Rights” Prevail: How state renewable energy policy is combating climate change

By Lauren Phillips, Staff Contributor

Many commentators feared that Donald J. Trump’s presidential election sounded the death knell for any United States public policy to address climate change.[1] Indeed, since his inauguration in January 2016, the Trump Administration has attempted to roll back multiple regulations that had designed to reduce U.S. greenhouse gas emissions, including regulations limiting carbon emissions from power plants and constraining methane emissions from oil and gas drilling operations on public lands. Perhaps most infamously, President Trump pledged to withdraw the U.S. from the Paris Climate Accord, leaving the U.S. as the only nation on earth to have rejected the climate agreement.[2]

But climate hawks[3] need not lose hope. Both before and since the election, states have independently taken ambitious steps to fight climate change– especially steps to reduce greenhouse gas emissions from power plants. The electric power sector accounted for 29% of U.S. greenhouse gas emissions in 2015: the largest share of greenhouse gases in any sector.[4] Luckily for the planet, state governments have control over their own intrastate energy markets[5] and have used that control to take steps to reduce their emissions.

The two most common tools states have used to reduce emissions from the power sector are renewable portfolio standards and carbon pricing.  Thirty-nine of the fifty states currently have renewable portfolio standards: regulatory mandates requiring a utility to source a certain percentage of its electricity generation from renewable sources.[6] Renewable portfolio standards have successfully increased renewable electricity generation in the United States, displacing greenhouse gas-emitting fossil fuel generation. Such standards accounted for 58% of all non-hydroelectric renewable energy capacity built nationally from 1998 through 2014.[7]

States have also reduced carbon emissions by capping emissions through carbon pricing in cap-and-trade schemes. Carbon pricing is the act of putting a price on carbon emissions,[8] which forces entities producing carbon pollution to internalize the external costs of their pollution.[9] In a cap-and-trade carbon pricing system, regulators set a ceiling for the total level of greenhouse gas emissions within an industry. Lower-emitting facilities are then permitted to sell their allowances to higher emitters, creating a market for greenhouse gas emissions.[10] Over time, regulators lower the cap, which in turn lowers total emissions.[11] Eleven states participate in inter- or intrastate carbon cap-and-trade systems.[12] The United States’ oldest cap-and-trade system is the Regional Greenhouse Gas Initiative (RGGI), composed of nine northeastern states.[13] RGGI states have reduced CO2 emissions from power generation by 45% since 2005[14] and set higher emissions reductions goals in the wake of the 2016 election.[15] RGGI may be poised to grow: the winners of the 2017 Virginia and New Jersey Gubernatorial elections have both expressed interest in joining the trading scheme.[16]

After President Trump announced the U.S.’s withdrawal from the Paris Agreement, fifteen states and territories (so far) have pledged to reduce their emissions in line with Paris’ greenhouse gas reduction goals via renewable portfolio standards and cap-and-trade systems.[17] Neither regulatory tool is one that President Trump can take out of their hands. So, climate hawks: if you disagree with the President’s approach to climate change, try calling your Governor.

As President Trump rolls back federal climate change action, Governors put established policy tools to work.

[1] See, e.g., Leo Benedictus, Noam Chomsky on Donald Trump: ‘Almost a death knell for the human species’, The Guardian (May 20, 2016), https://www.theguardian.com/film/2016/may/20/noam-chomsky-on-donald-trump-almost-a-death-knell-for-the-human-species.

[2] At the time President Trump announced his decision, Syria and Nicaragua had not yet signed the pledged. Since that time, both have announced intentions to do so. Lisa Friedman, Syria Joins Paris Climate Accord, Leaving Only U.S. Opposed, N.Y. Times, Nov. 7, 2017, https://www.nytimes.com/2017/11/07/climate/syria-joins-paris-agreement.html.

[3] A colloquium referring to people who care about climate change and clean energy. David Roberts, Introducing ‘climate hawks’, Grist (Oct. 21, 2010), http://grist.org/article/2010-10-20-introducing-climate-hawks/.

[4] U.S. Envtl. Prot. Agency, Sources of Greenhouse Gas Emissions, https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions (last visited Sept. 16, 2017) (comparing electricity to the transportation, industrial, commercial/residential and agricultural sectors).

[5] Scott Hempling, Regulating Public Utility Performance: The Law of Market Structure, Pricing and Jurisdiction 393 (Am. Bar. Ass’n 2013).

[6] Scott Hempling, Regulating Public Utility Performance: The Law of Market Structure, Pricing and Jurisdiction 373 (Am. Bar. Ass’n 2013).

[7] Wiser et. al, A Retrospective Analysis of the Benefits and Impacts of U.S. Renewable Portfolio Standards, Nat’l Renewable Energy Lab., 1 (Jan. 2016) https://www.nrel.gov/docs/fy16osti/ 65005.pdf.

[8] The World Bank, Pricing Carbon, http://www.worldbank.org/en/programs/pricing-carbon (last visited Nov. 5, 2017).

[9] Id.

[10] Id.

[11] Envtl. Def. Fund, How Cap and Trade Works, https://www.edf.org/climate/how-cap-and-trade-works, (last visited Nov. 5, 2017).

[12] See appendix.

[13] Reg’l Greenhouse Gas Initiative, https://www.rggi.org (last visited Nov. 5, 2017).

[14] Reg’l Greenhouse Gas Initiative, The Investment of RGGI Proceeds in 2015 3 (Oct. 2017) https://www.rggi.org/docs/ProceedsReport/RGGI_Proceeds_Report_2015.pdf.

[15] Press Release, Reg’l Greenhouse Gas Initiative, RGGI States Announce Proposed Program Changes: Additional 30% Emissions Cap Decline by 2030 (Aug. 23, 2017), https://www.rggi.org/docs/ProgramReview/2017/08-23-17/Announcement_Proposed_Program_Changes.pdf.

[16] See Valerie Volcovici, Democratic wins in U.S. state elections boost hopes for carbon trading, Reuters, Nov. 8, 2017, http://www.reuters.com/article/us-usa-election-climatechange/democratic-wins-in-u-s-state-elections-boost-hopes-for-carbon-trading-idUSKBN1D82V8.

[17]  U.S. Climate Alliance, 2017 Annual Report: Alliance States Take the Lead 3 (2017), https://gielr.files.wordpress.com/2017/11/8760b-usca_climate_report-v2a-online-rgb.pdf