This document provides an overview of renewable energy in the United States. It discusses the various state and regional programs promoting renewable energy development, including 29 states with Renewable Portfolio Standards and 26 with Energy Efficiency Standards. It also outlines major federal initiatives like the EPA's Clean Power Plan aimed at reducing greenhouse gas emissions from power plants. While progress has been made, the document notes that critical market and regulatory reforms will still be needed to significantly alter the country's energy profile and meet global climate commitments. Barriers to reform are also examined along with examples of how some jurisdictions are attempting to overcome obstacles to transition to higher renewable energy.

1. Overcoming Obstacles to High-Penetration
Renewable Energy in the United States
May 12, 2015
Professor Joseph Hunt
Environmental and Health Impact Assessment of International
Programs
Harvard University Extension School
Bruce Cohen
Jennifer James
Rebecca Sinisgalli
Matt Zito

2. 1
Table of Contents
1. Executive Summary………………………………………………………………….. 2
Bruce Cohen
2. The Untenable U.S. Energy Situation……………………………………………3
Rebecca Sinisgalli
3. Renewable Energy Landscape……………………………………………………..6
Matt Zito
4. Obstacles to Reforming the U.S. Energy System………………………….13
Bruce Cohen
5. Overcoming Obstacles………………………………………………………………19
Jennifer James
6. Recommendations……………………………………………………………………28
Bruce Cohen: A, B
Matt Zito: C
Rebecca Sinisgalli : D
Jennifer James: E
7. References……………………………………………………………………………….32

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1. Executive Summary
In December, the Conference of Parties (COP) to the United Nations Framework Convention
on Climate Change (UNFCCC) will meet in Paris to establish a global climate agreement to keep
global warming below 2 degree Celsius. As the U.S. prepares to present its climate commitments,
a critical question arises: can America’s patchwork of federal and state initiatives aimed at
reducing greenhouse gas (GHG) emissions and expanding renewable energy deployment achieve
the goals that will be expected of the global community?
To be sure, the past several years have seen the U.S. make substantial progress in advancing
clean energy amid a deeply fragmented political environment that has hindered national
renewable energy reform. Among the most notable is the Environmental Protection Agency’s
proposed Clean Power Plan that would dramatically cut fossil-fired power plant emissions.
Currently, 20 states have GHG emission targets, 29 states have renewable portfolio standards
(RPS) that expand clean energy generation, 39 states have building energy efficiency codes, and
Nine Northeastern states are members of the Regional Greenhouse Gas Initiative (RGGI), a
landmark carbon cap-and-trade program aimed at reducing electric utility emissions.
However, while these programs are necessary, they lack critical market and regulatory
elements that will be necessary to alter the nation’s climate profile. Such components include:
● Creation of new regulations, business models and markets in which the value of clean
energy is reflected in electricity prices, and utilities, energy service companies and
customers have incentives for activities that contribute to energy efficiency.

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● Modernization of the U.S. electric grid to expand transmission infrastructure, enable grid
interoperability to support high penetration of renewables, and manage distributed clean-
energy generation, behind-the-meter energy storage and demand response.
● Analysis of the total capital requirements needed to finance the necessary national
infrastructure build-out and renewable-energy market penetration.
The paper will provide an overview of the U.S.’s current energy environment, in particular
the implications for nearing the two-degree Celsius climate ”tipping point.” It will then review the
current national regulatory landscape, examining how states are variously pursuing renewable
energy transitions, including renewable portfolio standards and energy efficiency standards.
Major obstacles to reforming the energy system are discussed and examples of how these
obstacles can be overcome are provided. We suggest how New York State's Reforming the Energy
Vision (REV), a ground breaking energy plan, could serve as a blueprint for the U.S. to meet its
global climate commitments. We note the importance of utilizing an integrated assessment
approach in implementing an energy plan--for example, recognizing that low-income and
minority communities very often suffer disproportionate impacts from high electricity prices and
are more likely to live in close proximity to power plants. The paper concludes with
recommendations and suggested areas for further study.

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2. The U.S. Untenable Energy Situation
Climate Change and Fossil Fuel Impacts
During the last 100 years global average temperatures have risen by about 1.5˚ F and are
projected to rise another 2 degrees to 11.5 degrees F by year 2100 (Lotstein, 2009). Increases
above 2˚ C have been analyzed and the models indicate increased frequencies of severe weather,
potential health hazards, and negative environmental and economic impacts. A recent example
that demonstrates the devastating impact of severe weather is Superstorm Sandy. In addition to
causing at least 43 deaths, New York and New Jersey suffered significant infrastructure damage
and power loss (Tollefson, 2013) . The impacts on people, businesses and social systems were
long lasting and wide reaching, with damage estimated at approximately $42 billion (Tollefson,
2013).
The UNFCCC has established a global objective to reduce CO2 emissions to below a 2 degree C
tipping point. The UNFCCC is pushing for a global commitment to reducing CO2 emissions from
today’s average of 5.2 tons to 1.6 tons by 2050 (DDPP, 2014), and the U.S. is being pressured to
play a leading role. Another related global initiative is the Deep Decarbonization Pathways Project
(DDPP), which is a commitment to achieve aggressive CO2 reduction targets. It identifies how
countries can transition to a low carbon economy, which would result in lowering the surface
temperature to less than 2˚C (DDPP, 2014). In 2015, the DDPP will submit a comprehensive
report that will be presented to the French government who will host the 21st Conference of
Parties (COP-21).
Fossil fueled electricity generation leads to many negative health and safety impacts. The
discharge of sulfur dioxide, nitrogen oxides, and particle matter contributes to the poor air

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quality, which is the cause of 3,500 deaths within the U.S. every year, and 1,000 heart attacks and
hospitalizations per year from related air pollution illnesses (Weiss, 2015).
Water is heavily linked with energy production. 20% of non-agricultural water
consumption is used by power plants for cooling (Lotstein, 2009). The demand for cooling energy
will increase from 5 to 20% per 1.8 degrees F, as global temperatures increase (Lotstein, 2009).
An increase in water consumption in the cooling process utilizes a constrained natural resource
and increases the cost of treating and returning the water to surface water bodies by utilities for
other uses. Increasing temperatures will also increase electricity demand for air conditioning.
Temperature increase of 2˚C will increase peak demand for electricity in most regions of the
country; this will lead to a disproportionate increase in energy infrastructure investment
(Lotstein, 2009).
Another aspect of global warming that causes significant environmental and economic
impacts is sea level rise. A significant amount of America’s energy infrastructure is located near
the coast (Lotstein, 2009). As indicated by Superstorm Sandy, this can lead to equipment damage
from flooding, storm surges and erosion. Sandy caused much of Long Island’s electrical
infrastructure to be destroyed and it took months to rebuild. As a result, the New York Power
Authority has approved $ 726 million in transmission system upgrades to improve the reliability
and strengthen the electric grid (Smith, 2013). Governments and utilities will see an increased
cost of waterproofing the electrical structure or relocating physical structures. In particular, East
Coast and Gulf Coast facilities are identified as vulnerable to sea level rise due to the flat and
already sinking terrain found there (Lotstein, 2009).

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Aging Infrastructure Impacts
Infrastructure resilience concerns related to climate change are exacerbated by aging electric
and gas infrastructure. The American Society of Civil Engineers has estimated that U.S. cities will
need to invest $3.6 trillion dollars to maintain basic infrastructures, over the next 20 years
(REinvest, 2015). New York State is an example of a state struggling with an aging infrastructure
system; Over the last decade, New York has spent $17 billion on energy infrastructure and is
expected invest $30 billion to maintain current energy systems (Carson, 2014).
The Role of Renewable Energy
These challenges have created a need to make significant investments in alternative
power sources, storage technology and distribution capability to both mitigate climate change
impacts and improve infrastructure resilience. Renewable energy technology offers a diverse and
environmentally friendly power source. Investments in diversifying power sources will need to
address the integration with the electric grid. Whether the renewable source is solar, wind, or
water, it will require a storage and distribution capability that can meet business and societal
needs. Another challenge for current utilities is how to manage the flow of electricity from
renewable sources. Today the distribution grid is a one-way power flow (Carson, 2014). The
engineering challenge is how to accept and store excess electricity generated and meet peak
demands.
This paper will next look in more detail at the current U.S. regulatory landscape for CO2
emissions and renewable energy transition, discuss the key barriers to more aggressive policies,
provide examples of how these barriers can be overcome, and suggest a future policy and
implementation plan.

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3. Renewable Energy Landscape
Currently, the United States’ plan to increase renewable energy generation consists of a
variety of state and region-wide incentive programs and legislative mandates. Plans
implemented to reduce GHG emissions also generate funds for new renewable energy generation.
Twenty-nine states as well as Washington DC and two U.S. territories currently have Renewable
Portfolio Standards (RPS) in place. (Database of State Incentives for Renewables and Efficiency)
Additionally, twenty-six states have Energy Efficiency Standards (Database of State Incentives for
Renewables and Efficiency). California and the Northeastern states have set goals to reduce GHG
emissions through binding legislative mandates that lower the amount of GHG emissions allowed
by major GHG contributors such as electricity generation stations on an incremental annual basis.
The EPA, under President Obama’s Climate Action Plan, has proposed The Clean Power Plan for
Existing Power Plants and the Carbon Pollution Standards for New Power Plants in order to cap
and reduce GHG emissions nationally.
RPSs are all structured differently. Each RPS specifies a different percentage of renewable
energy, specified in each individual RPS, that electricity service providers (ESPs) must
incorporate into the amount of electricity they sell. The technologies eligible for RPS compliance
differ from state to state and the extent that a certain technology may contribute to a state’s RPS
goal also differs. Rules on where electricity used for RPS compliance can be sourced varies
among states as well. Each state’s RPS rules are tailored specifically towards their resources and
the demands placed on them. In order for a national RPS to be successful, it needs to account for
the variations in available resources in different regions of the country and the different regional
electricity demand.

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The majority of RPSs provide an incentive to renewable generators by awarding a Renewable
Energy Credit (REC) for each MWH of renewable energy generated and distributed into the
wholesale market. ESPs may then either buy RECs to meet their RPS compliance goals or
generate the renewable energy themselves. ESPs have a third option of paying an Alternative
Compliance Payment to meet RPS requirements, but this option is typically only exercised when
there is a shortage of RECs available to meet their requirement.
On May 5, 2015 the Hawaii legislature passed House bill 623 which if signed by Democratic
Governor David Ige will make Hawaii the first state to set a RPS goal of 100% renewable energy
by 2045 (Savenije). The bill passed in the senate with a 27-1 vote and in the house with a 50-1
vote implying that Governor Ige will sign the Bill. Hawaii has the highest electricity costs in the
U.S. and is the only U.S. state where the economics of rooftop solar beats the price of electricity
from the grid by itself (Savenije). To reach their 100% RPS goal, the Hawaii Public Utilities
Commission proposes to nearly triple rooftop solar, develop energy storage, develop smart grids
to help customers monitor and use electricity more efficiently, create community solar programs
and increase demand response programs (Savenije). Hawaii Public Utilities Commission estimate
this to reduce the customer’s utility bill by roughly 20%. Although Hawaii’s electricity economics
are much different than that of the rest of the United State’s, it will likely offer valuable insight to
the rest of the country about how to incorporate renewables into the grid without compromising
reliability.

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In 2006, Assembly Bill 32 (AB 32), the California Global Warming Solutions Act, was passed
requiring California to reduce GHG emissions back to 1990 levels by 2020. (California
Environmental Protection Agency Air Resources Board) On April 29, 2015, Governor Edmund
Brown Jr. increased California’s GHG reduction commitment by issuing an executive order to
reduce GHG emissions 40% below 1990 levels by 2030. (Office of Governor Edmund G. Brown Jr.)
This is the most aggressive GHG reduction commitment in North America and falls in line with the
leading international government’s commitments of the United Nations Climate Change
Conference. The European Union set this same goal in October of 2014. (Office of Governor
Edmund G. Brown Jr.) This commitment puts California on track to meet its goal, established in

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AB 32, of reducing CO2 levels 80% below 1990 levels by 2050. This goal is believed to keep the
average global climate increase below 2 degrees Celsius, the level which is thought to cause
irreversible and devastating environmental impacts such as complete arctic ice melting and
coastal destruction caused by rising ocean levels. (Office of Governor Edmund G. Brown Jr.) AB
32 includes programs targeting a variety of industry sectors, most importantly the transportation,
energy, resources and waste sectors. It is funded by fees collected annually from the
approximately two hundred fifty top contributing GHG sources in California including oil
refineries, cement plants, electricity power plants and food processors and from quarterly GHG
allowance auctions. The auction’s proceeds go towards the Greenhouse Gas Reduction Fund,
which funds a variety of GHG reduction projects including renewable energy and energy
efficiency development in low income housing.
The Regional Greenhouse Gas Initiative (RGGI), which includes nine northeastern states, is
the first program in the U.S. to cap the amount of CO2 that power plants located in the
participating RGGI states are allowed to emit. The total amount of CO2 allowance by all the RGGI
participants makes up the program’s “cap.” The 2015 RGGI CO2 Cap is 88,725,000 short tons and
the cap decreases by 2.5% annually through 2020 (Regional Greenhouse Gas Initiative). Auctions
are held quarterly by participating states during which time CO2 allowances are auctioned off and
used to meet RGGI participants’ CO2 compliance goals. Every allowance represents one short ton
of CO2. The percentage of allowances auctioned off to each state is determined by RGGI and has
been calculated to allow for a fair distribution among participating states. Proceeds from the
RGGI auctions are invested in renewable energy and energy efficiency programs. This program is
similar to the cap and trade program enacted by the Clean Air Act in 1990 to reduce ambient
levels of SO2 and NOx that contribute to acid rain. The SO2 and NOx cap and trade program has

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been very successful, boasting a 99% compliance rate (Cap and Trade: Acid Rain Program
Results).
The EPA proposed the Clean Power Plan in June 2014 to build upon existing carbon
legislation already underway in California and the participating RGGI states and develop GHG
emission standards throughout the remaining states (Carbon Pollution Guidelines For Existing
Stationary Sources: Electric Utility Generating Units). The goal of the Clean Power Plan is to
reduce CO2 levels by 30% from 2005 levels by 2030. The plan establishes state specific CO2
emission rate goals based on each state’s fuel mix and electricity market. Although it specifies the
amount each state must reduce its CO2 emissions and provides guidelines for how the states
should develop their programs, it does not specifically prescribe how the state should go about
reducing its CO2 emissions.
The strategies included in the guidelines include increasing carbon intensive power plant
efficiency, developing programs that spur private investment in low-emitting and renewable
power sources and developing programs that help homes and businesses use electricity more
efficiently. Additional strategies include upgrading the electricity grid infrastructure with current
technologies and reducing electricity demand across the grid. The EPA estimates the Clean Power
Plan will yield net climate and health benefits of between $48-$82 billion. (Carbon Pollution
Guidelines For Existing Stationary Sources: Electric Utility Generating Units) Under the plan, coal
and natural gas will remain the two leading sources of electricity.
Creating market incentives that drive clean energy development, reduce pollution and
increase energy efficiency is essential for the success of a sustainable energy infrastructure. It
allows businesses to explore different paths to achieve the legislative mandates put in place by

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RPS’s, EESs and pollution caps. New jobs are created by such programs and new opportunities to
raise money are created. Utilizing market mechanisms that create incentives, such as RECs, has
also successfully created robust voluntary markets. There are a few key components to creating
these market mechanisms. First, there must be a desire for businesses and homeowners to
participate. Second, there must be a reliable way to measure “green” attributes such as
renewable energy generation or pollution avoidance. Finally, there must be a way to track, record
and retire these “green” attributes.
People are becoming increasingly educated and concerned about the harmful impacts the
energy economy places on the environment. This has led to businesses marketing themselves as
“green” to meet consumers’ demands to choose products that are less harmful to the
environment. Businesses and individuals have several options to be “green.”. RECs may be
purchased to substantiate claims that a business uses a certain type of renewable energy. Green-
E has set up a national voluntary market in which participants may buy a variety of different RECs
such as solar and wind RECs. Renewable energy generators may choose to fill out a Green-E
attestation form and be allocated Green-E certified RECs to sell to individuals or businesses.
Generators that choose to do so typically do not qualify to be allocated RECs from a state
mandated RPS for several reasons. Their generation facility may not be located in a region with
an RPS or their facility may be too old or too big. Green-E’s voluntary REC market has created a
financial incentive for businesses that own such facilities to continue to develop renewable
energy generating stations and a resource for businesses and individuals who wish to be seen as
“green” to do so.
In addition to RPS’s and GHG reduction programs, twenty-six states also have Energy
Efficiency Standards (EES) which aim to decrease the demand of electricity consumption through

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the implementation of efficient appliances, smart grid technologies and buildings designed to
consume less energy. These programs have created a solid foundation from which a switch from
a fossil fuel based energy system to a renewable energy based energy system may begin to
happen. There is still much that needs to be done and large obstacles to overcome before this
transformation is realized.
4. Obstacles to Reforming the U.S. Energy System
Political Realities
Among the biggest obstacles to achieving a transition is a deeply fractured political climate
resulting in a lack of a consensus on reaching any comprehensive national environmental policy.
In the debate on policy, proponents of energy reform are often overshadowed by the oil, gas, and
coal lobby politically powerful industries that have a vested interest in blocking expansion of
renewable energy.
One measure of the fossil fuel industry’s influence is the subsidies it enjoys. In 2013, the oil,
gas, and coal industries received about $21.6 billion in state and federal exploration and
production subsidies (Makhijani, 2014). Exploration subsidies allow companies to deduct costs
associated with discovering new reserves from tax payments, rather than capitalizing the
expenses over their useful life. Most production subsidies are tied to royalty payments made to
the federal government for leases on gas and coal producing lands (Makhijani, 2014). By contrast,
in 2013, total renewable energy production and energy efficiency subsidies were approximately
$8 billion (Energy Information Admin., 2015).
Political spending is another area where fossil fuel interests wield sizeable power. In the 2014
Congressional midterm election cycle, the oil, gas, coal, and electric utilities industries spent $721

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million The spending breakdown: $500 million on lobbying; $163 million on television ads; $64 in
contributions to candidates and political parties. Environmental groups spent $43 million on
lobbying and $11.7 million on contributions to candidates (Center for American Progress, 2014).
Regulatory and Market Structure
Like the political environment, the regulatory structure for electricity in the US is also
fragmented, with utility regulation lying chiefly with states. There exists no consensus among
state policymakers and regulators on a renewable energy blueprint, with each state pursuing
different approaches to reducing greenhouse gas emissions, energy efficiency, and deploying
renewable energy.
States like New York and California, which long have enjoyed histories as laboratories for
testing innovative economic and social policies are not surprisingly in the lead charting
renewable energy paths. New York’s Reforming the Energy Vision plan (REV) is notable as the
first state to lay out an energy plan to comprehensively address how electricity is produced,
managed, and consumed, with a central focus on grid modernization, which is discussed further
in the paper.
If there is one area that points to a more positive outlook, it is a growing body of research that
suggests the U.S. is technologically capable of achieving a large market penetration of renewable
energy--between 80% to 100%--utilizing current renewable technologies. (Jacobson, et al, 2015;
Mai, et al, 2012; Budischak et al., 2013). In one of the most comprehensive studies of renewable
electricity penetration, the U.S. National Renewable Energy Laboratory determined that the U.S.
could reach 80% penetration of renewable energy deployment by 2050, using a mix of
photovoltaic and concentrated solar, wind, hydropower, biomass, and geothermal (Mai, 2012). In

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addition, the NREL predicted that at 80% renewables penetration, coal and natural gas
production would be reduced by 80% and GHG emissions and electric- utility water usage cut by
50%.
Though the study noted this scenario would require a wholesale transformation of the
electric system, including increased flexibility of the grid, multi-state transmission infrastructure,
and development of new business models and market rules.
Grid Infrastructure
What the NREL study underscores is that the principal challenges to reaching high renewable
energy penetration in the U.S. are not technological, but rather barriers imposed by an aging grid
infrastructure and financing to fund the build out. Electric utilities are the most capital intensive
sector of the U.S. As noted in Figure 1, the grid will require transmission investments of $120
billion to $160 billion over the next decade just to maintain the existing infrastructure (Brattle
Group, 2015).
In the Northeast, Midwest, and California., the grid is managed by a handful of regional
independent system operators (ISOs), which both operate the system and facilitate energy
transactions in the wholesale market. Among the criticisms of ISOs is they are largely ineffective
in identifying important grid infrastructure investments that could benefit the system as a whole.
In addition, underinvestment in transmission exposes customers to higher electricity costs and
the vulnerability to price volatility in the event of grid failure.

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Fig. 1. Infrastructure Investments
Source: Brattle Group
Further, current grid planning ignores the high cost of short-term challenges and extreme
market conditions caused by factors like extreme weather, outages, fuel supply disruptions.
(Chang, 2015)
One statistic that illustrates a vexing issue of the current grid is capacity utilization. In New
York and New England between 2005-2009, electricity demand exceeded 70% of its peak for only
1,000 hours. That is, more than 30% capacity was used only 12% of the time, as illustrated in
Figure 2. The problem is low capacity utilization leads to higher electricity costs due to the need
to pay for capital that is idle most of the time. (Heidel, 2011). The U.S.’s current capacity
utilization rate is about 47%. (EIA, 2011).

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Fig. 2 New England and New York Load Duration Curves
Source: MIT-The Future of the Electric Grid
A recent trend in electricity demand that has posed challenges to the grid is sharp increases
in demand during select hours of a year. This has contributed to an increasing ratio of system
peak loads to average loads and declining capacity utilization. One driver of the trend has been
the rapid increase in homes using air conditioners, spiking demand in the hottest hours of the
summer. Another is the decline in industrial use of electricity since the 1960s. Because industrial
companies generally use electricity 24-hours- day, year-round, they even out the demand curve.
Consequently, the decline in industrial use has steepened the curve (Heidel, 2011).
The dramatic rise in net metering, where a customer with, say, a rooftop solar system can sell
excess electricity back to the grid, poses challenges as well. That’s because net metering
compensates the customer for generating power at the retail electricity rate, rather than the

19. 18
wholesale rate. The difference between these costs is the fixed costs of distribution and
transmission, which is recovered by a per- KWH charge on a customer’s bill. The customer saves
both the wholesale cost and the charge to recover fixed costs, thus not bearing the full
distribution costs of the grid.
In essence, the U.S. cannot continue on the path of producing electricity to accommodate peak
loads. Instead, a diverse mix of variable renewable energy sources could be deployed more
efficiently and cost effectively as a resource to meet demand. Another solution is demand
response tools, a feature of smart grids, which give customers the option of reducing energy use
during hours of peak demand through financial incentives, such as time-of-day pricing.
Though as has been noted, implementing variable renewable sources and demand response
capabilities into the grid will require changing the electricity market structure. Among the key
shifts would be shifting utilities from the current structure of incentives based on volume of
energy produced to an incentive tied to how efficiently electricity is distributed across the grid, as
New York’s REV has proposed (REV, 2014).
Economics and Financing
How the U.S. will finance this new, uncharted renewable energy landscape is a question that
has garnered a great deal of attention in the clean energy literature. One of the chief tenets of a
renewable energy economy is the notion of “grid parity,” that renewable energy must become
cost competitive with fossil fuels to a create self-sustaining market. As more renewable energy
projects come online, economies of scale would lead to lower energy prices, attracting greater
private investment and spurring renewable energy penetration.

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However, some academics analyzing grid parity more closely have pointed out that for
renewables to achieve parity, the cost must be competitive with the marginal cost of the
generating resource it seeks to displace. (Olson, 2012) Thus, it is not enough for renewables to
achieve cost parity alone; their cost must be less than the value that renewables provide in
avoided conventional energy.
Olson discusses the concept of energy value: the marginal value of a renewable resource at
displacing a unit of conventional energy generation. Olson found that the grid parity cost target is
not static, but a dynamic moving target. As renewable penetration increases, its value in
displacing convention resources declines. This is because as more variable renewable resources
of a given type are added to the grid, the market becomes flooded during the hours the resource is
producing.
However, a number of mitigating factors could affect the rate at which the grid parity cost
target declines. For example, an increase in fossil fuels prices triggered by a carbon tax and
advances in renewable energy storage that would compress prices differences between peak and
off-peak energy. If renewable energy does in fact have a dynamic value, it could have vast
financial implications as there may be limits to the ability of renewables to compete on cost alone.
5. Overcoming Obstacles
Despite the obstacles, many progressive states, cities and organizations in the United
States are committed to realizing the potential of high renewable energy penetration. Several
academic and government institutions have developed models to demonstrate the technical and
financial feasibility, as well as the health, environmental and economic benefits, of displacing
fossil fuels with 100% renewable energy. Some of the more progressive states have developed

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renewable energy targets and strategies to turn theory into practical implementation. This
section will assess leading academic models and state plans to determine how their best practices
could be leveraged to develop a winning national renewable energy strategy.
Academic Studies Claim Technical and Economic Feasibility
Overview of Key Studies
Mark Jacobson, Mark Delucchi and a team from Stanford University developed a model
and published a series of plans for achieving 100% renewable energy penetration globally, across
the United States and within individual states (Jacobson & Delucchi, 2009; Jacobson et al., 2015).
The plans factored in energy uses of all types – electricity, transportation, heating and cooling,
and industry. Jacobson et al.’s updated U.S. roadmap released in April 2015 assumed that all new
electric power generation resources would become water, wind or sunlight (WWS) based by
2020, and that conventional fossil fueled generation would be phased out over time to achieve
80%-85% renewable penetration by 2030 and 100% by 2050. Their plans incorporated a broad
range of WWS energy sources including onshore and offshore wind, rooftop and utility scale
photovoltaics (PV), Concentrated Solar Power (CSP), geothermal, hydroelectric, and wave and
tidal. Detailed state-by-state analyses, recommendations and benefit estimates were made.
Another influential study was published in 2013 by a team from the University of
Delaware (Budischak et al., 2013). The study involved an intensive modeling effort that identified
cost minimized combinations of renewable energy generation compared to fossil generation.
Their area of analysis was the section of the eastern United States covered by PJM
Interconnection, a large transmission system operator. The analysis considered only electricity
and not the other energy-intensive sectors, and it conservatively considered only variable solar

22. 21
and wind energy sources, i.e. inland wind, offshore wind and solar PV, along with three types of
energy storage.
The model used real load data from PJM as well as actual wind and sunlight data from the
National Oceanic and Atmospheric Administration (NOAA) and the National Energy Renewable
Energy Laboratory DOE/(NREL) in hourly increments over a four-year period. It compared 28
billion combinations of wind power, solar power and electrochemical storage to identify the least-
cost options within the constraint of always keeping the lights on.
A third study was undertaken by the U.S. National Renewable Energy Laboratory (Mai et
al., 2012). RE Futures provides an analysis of scenarios for high levels of renewable electricity in
the United States and an analysis of associated grid integration opportunities and challenges. RE
Futures describes the system characteristics needed to accommodate high levels of renewable
generation, but does not attempt to address institutional, market, or regulatory aspects of such a
transformation.
Cost/Grid Parity
To compare the costs of transitioning to WWS generation by 2030-2050 to the costs of
continuing with mostly fossil fueled energy sources, Jacobson et al.’s 2015 Stanford research
compared average annualized, levelized business costs of the various traditional and renewable
energy sources for each state and for the country as a whole. Cost estimates included capital, land,
operating, maintenance, storage, fuel, and transmission costs, as well as internalized costs
associated with global warming damage and air pollution morbidity and mortality. The analysis
found that 2013 business costs of hydroelectric, onshore wind, utility-scale solar and solar
thermal for heat are comparable to, and in some cases less than, natural gas combined cycle

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generation. The analysis also revealed that all WWS technologies except wave power would cost
less than conventional fossil fueled technologies by 2050.
Budischak et al.’s Delaware research (2013) on intermittent renewable electricity
generation also demonstrated that a transition to high penetration renewable resources was
financially feasible. The Delaware plan used 2030 as the target year for 100% penetration instead
of 2050. It also looked at non-subsidized costs and included the capital costs of financing and
building new generation capacity; operating and maintenance (O&M) costs for the generation and
storage assets; and health and environmental costs to third parties. However, unlike Jacobson et
al. they did not include transmission costs. The Delaware model determined that 2013 electricity
costs would be lowered by using renewable energy from WWS sources 30% of the time, which
equals about 60% of total energy, assuming 2008 equipment costs, no subsidies and factoring in
air pollution costs. The model also demonstrated that a transition to using renewable energy
99.9% of the time is feasible by 2030 at costs comparable to today’s electricity costs.
Neither analysis followed the grid-parity marginal-cost approach recommended by Olsen
(see Section 4). However, Budischak et al. did model the changing relative values of different
technology combinations in hourly increments over a four-year period and Jacobson et al.
performed calculations at 30-second intervals to address changing values and attributes over
time. Their costs also considered broader environmental and health costs of fossil fuels, which are
less affected by the marginal cost analysis. It can also be argued that Olsen’s approach speaks to a
much narrower analysis of specific renewable technology adoption over time rather than the
complex options analyses performed by the Stanford, Delaware and NREL research, and that
Olsen looks at cost and not at a more comprehensive cost-benefit analysis.

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Even so, there are limitations to the academic studies; there is no way to accurately
predict the costs of 100% renewable energy adoption compared to fossil fueled options using a
point-in-time study given the many complex, changing system dynamics. These academic models
are helpful in showing the theoretical potential but do not replace the type of granular regional
modeling like that conducted by the State of Hawaii in establishing a plan for 65% renewable
energy adoption. In addition, State renewable energy plans must be developed with the goal of
updating models regularly to incorporate new understanding and changing dynamics, and with
adequate flexibility to adjust plans as needed.
Grid Integration and Service Reliability
Jacobson et al. (2015) addressed grid integration and reliability concerns using a grid
integration model that showed a 100% WWS energy system could match load every 30 seconds
while accounting for resource variability. They found that frequency regulation of the grid could
be managed by storing excess heat and electricity from hydroelectric, CSP and pumped hydro
sources instead of shedding load, and by minimally leveraging demand response. The Jacobson et
al. analysis revealed many low-cost, stable options for a 100% WWS system, suggesting that
reliability is not an insurmountable obstacle.
Budischak et al.’s Delaware model (2013) considered only variable wind and solar
resources, increasing the challenges of reliably meeting load requirements. To manage generating
variability Budischak et al. used a combination of techniques. Solar and wind resource
diversification along with geographical dispersion of WWS assets were used to produce more
consistent power output; energy storage was used to fill in supply gaps, absorb excess generation
and enable rapid response to output fluctuations; and traditional gas-fired generation was
considered a last resort backup. The Delaware team noted that load curtailment, demand

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response, and leveraging adjacent grids are often additional options but were not considered in
this analysis to simplify and be conservative. Like Jacobson et al. the Delaware team was able to
identify cost effective ways to reliably meet load requirements 99.9% of the time by 2030 even in
a situation where only variable wind and solar resources plus minimal storage were used. The
least cost options prioritized excess WWS energy production over storage due to the relative cost
advantage in most scenarios.
NREL also concluded that electricity supply and demand could be balanced in every hour
of the year to meet the assumed target of nearly 80% electricity from renewable resources by
2050, including 50 percent from variable renewable generation (Mai et al., 2012).
In summary, all three studies show that even using today’s existing technology, very high
levels of renewable energy penetration are technically possible without causing additional
disruptions in service quality. However, the issues of aging grid infrastructure, interoperability
requirements, adequacy of transmission assets, and smart technology investments must be
addressed in any generation scenario.
From Theory to Practice: How Progressive States are Overcoming Obstacles
Regulations and Politics
As outlined in Section 3, most states now have GHG, RPS and EE mandates or targets,
indicating that regulatory reform is attainable. For instance, the State of Hawaii’s commitments to
transition from 26% renewable energy generation to 67% in 15 years and to achieve 100%
renewable energy penetration by 2045 show that rapid, massive change is possible (Hawaiian
Electric Companies, 2014). California’s announcement of a 40% reduction in GHG emissions over
1990 levels issues a challenge to the rest of the country to step up and match the more aggressive

26. 25
EU commitments in time for the COP ‘21 events. The RGGI CO2 market proves that a carbon
trading system that crosses state boundaries is both possible and beneficial. Finally, the proposed
EPA Clean Power Plan indicates that the political tides may be starting to turn in the favor of a
national climate mandate. Another positive indication that political obstacles are not
insurmountable is the Obama Administration’s call for phasing out fossil fuel tax subsidies in its
FY 2014 budget, a step that would significantly alter the entire incentive structure for the U.S.
energy market (U.S. Dept. of State, 2014, p.16).
Comprehensive Energy Reform -- New York’s Progressive Approach
Although the federal government and many individual states are taking positive steps
toward a renewable energy future, New York’s Reforming the Energy Vision (NYS DPS, 2014) and
associated State Energy Plan (NYS EPB, 2014) propose to take energy reform to a whole new
level. Our analysis indicates that the New York plan is the most comprehensive, integrated
approach to energy transformation and many aspects of it can serve as a model for the U.S..
Beyond setting aggressive renewable penetration and energy efficiency targets, New York is the
first state to wholly address the future of how electricity is produced, managed and consumed
(Carson & Davis, 2014). New York’s REV calls for a regulatory and market overhaul, takes a
comprehensive systems approach to renewable adoption in the context of broader energy reform,
and proactively promotes future technology innovation. Some of the key features of the New York
approach will be assessed here from the perspective of overcoming real and perceived national
barriers to high penetration renewable energy.
Market Reform
A central aspect of New York’s approach is a major market restructuring toward a system
that is primarily renewable energy based. To achieve this, the utility role must shift from

27. 26
producing electricity from a few central hubs and distributing it to consumers, to one that
facilitates power flow between numerous independent, distributed systems (McDonnell, 2015).
As such, New York intends to:
● Limit utilities’ ability to own distributed renewable generation sources, while encouraging
new entrants and competition to stimulate technological innovation and drive down rates
(McDonnell, 2015).
● Shift to a performance-based rate structure for utilities based on how efficiently and
effectively they distribute power, making it advantageous to use distributed energy
resources (McDonnell, 2015).
● Change the role of the utility to that of a Distributed System Platform Provider (DSP)
essentially acting as a dispatcher for a future grid that would contain many more
distributed energy resources. The DSP would act as the retail interface to coordinate
customer activities across the service area, using programs such as demand response to
more efficiently meet demand. It would also act as an overall aggregator that interfaces
with NYISO to bid load. The expectation is that leveraging an advanced technology
platform, demand management programs and more responsive distributed energy
resources would enable the DSP to bid load in a more predictive fashion that saves money
for customers and creates greater system efficiencies (NYS DPS, 2014).
This market structure overcomes concerns about utilities gaining too much control, thereby
stifling innovation; utilities not being incentivized toward renewable energy and energy
efficiency; and the potential for negative reliability and efficiency impacts in the event that
distributed energy resource adoption is uncoordinated.

28. 27
Innovative Financing Solutions
Upfront financing of renewable energy capital investments was identified in Section 4 as
one of the biggest barriers to high-penetration renewables. New York acknowledges the great
difficulty in obtaining financing and plans to overcome it by attracting greater private sector
financing, leveraging ratepayer funds, and providing policies to foster the long-term stability
needed to promote investment (NYS EPB, 2014). New York has several renewable energy and
energy efficiency funding programs in place, including the NY-Sun initiative, Build Smart NY and
funds obtained through its RGGI participation (NYS EPB, 2014). The individual funding programs
are managed by a central body, the New York State Energy Research and Development Authority
(NYSERDA) to ensure coordination, tracking and management. Newly announced is the
establishment of the New York Green Bank, which will fill financing gaps by partnering with
private sector entities to create a larger supply of clean energy project financing, provide different
forms of financing support, facilitate the development of clean energy bond markets, and enhance
market confidence in clean energy investing through greater communication and transparency
(NYS EPB, 2014).
Addressing Social and Economic Impacts
New York has extensively engaged stakeholder groups during the REV process, including
community and social groups through town meetings and online feedback solicitation. Among the
goals is to provide consumers with incentives for efficient energy use, for instance smart meters
and online tools to track usage as well as time-of-use rates to encourage peak load reduction.
Consumers will also be encouraged to invest in distributed energy renewables, for example
rooftop solar incentives and net metering. Consumers will ultimately have much more control
over their energy usage and supply, and New York is committed to making decision support data
more available, transparent and easy to consume (NYS EPB, 2014). To overcome potential energy

29. 28
equity and social justice issues, NYSERDA has a mandate to provide clean energy options to low-
income customers who may otherwise not benefit from the new market transition.
From a broader economic perspective, REV encourages new jobs by leveraging New York
companies, providing incentives for technological innovation, and opening the market to new
entrants, which should also stimulate competition and decreasing energy rates (NYS DPS, 2014).
6. Recommendations
The December 2015 UNFCCC Conference of Parties presents an opportunity for the
United States to demonstrate its commitment to global leadership for climate action -- a
commitment that would not only get the nation on track for a clean energy future but also put
pressure on other nations to do the same. Following are several recommendations the U.S.’s
approach.
A: Integrated Assessment Approach
As the U.S. moves to develop energy plans to meet its climate commitments, it is
important to utilize an integrated impact assessment. This is underscored by the fact that the
disparate impact of state energy policies on low-income and minority groups has often been
overlooked. Energy affordability is a case in point. Households with incomes below 50% of the
federal poverty rate pay more than 40% of their income for energy, while households above
150% of the poverty rate pay just 6% (REV, 2014). Because more power plants, landfills,, toxic
waste sites, and sewage treatment plants are located in low income communities,. people of color
are exposed to far higher levels of air pollution.,(Bullard, 1994; Bryant, 1995). In the U.S., 57% of
all whites, 65% of African-Americans, and 80% of Hispanics live in counties that failed to meet at
least one of the EPA's ambient air quality standards (Weitzman, 1990). As New York’s energy

30. 29
plan explicitly recognizes environmental justice goals in its mandate, it serves as a strong model
for states seeking to develop an integrated assessment approach.
B: Metrics
As is often said, “What gets measured gets managed.” The effectiveness of any energy
plan rests on the ability to measure results. We see value in using a sustainability analysis
approach that would use environmental, economic and social metrics to assess outcomes. One
study by NREL offers an example of using sustainability indicators to analyze measures such as
job growth, energy affordability, energy diversity, and cost effectiveness (Cowlin, 2014). For
example, the NREL study’s diversity indicator reflects the fractional share of a utility’s electricity
generation take-off from a generation source. As we move toward a clean energy system, energy
diversity will play an increasingly important role in managing renewable power resource
variability to match electricity load demand.
C: Expand Existing State and National Plans
By increasing the supply of clean energy sources, mitigating GHG emissions and
decreasing the overall demand of electricity, The United States will become less dependent on
foreign energy commodities and reduce the negative impact on the environment caused by
electricity production while meeting the Country's energy needs. There are some major obstacles
that must be overcome prior to the U.S. being able to make the switch from relying primarily on
fossil fuels for electricity generation to using renewable sources as primary fuel sources.
However, by expanding the key elements of existing state and region wide energy programs such
as renewable generation development, maximizing grid efficiency, reducing peak demand and
mitigating the dispersion of harmful air pollutants on a national level, the U.S. may successfully

31. 30
make the transition from fossil fuels to renewable energy sources. The Clean Power Plan is the
first legislative mandate to establish solid GHG reduction goals on a national level. The way the
program operates establishing non-negotiable GHG reduction targets but allowing states to
decide how to best reach those targets is essential for any national renewable energy program to
succeed. Expanding the existing strategic multi-faceted approaches in place in state and regional
energy programs, establishing state specific goals nationally and giving states the freedom to
decide how to reach those goals, is the key to creating a national sustainable energy policy.
D: Invest in New Technology and Infrastructure Upgrades
The energy industry needs to invest in the development of storage technologies. The
improved ability to store energy that is produced is a necessity to increase the efficient use of
renewable energy sources. The energy produced by renewable such as solar or wind is not able
to store and use energy in an integrated manner with the existing electric grid to meet customer
demands. There has been increased research and development in battery storage and fuel cell
storage. Both technologies have advanced their capacity. The current limitations are the size of
the batteries required to store sufficient energy. There needs to be a breakthrough in the
technologies which will compress the physical space needed for the batteries.
Investment is required to harden the electrical grid specifically on the coasts and in lower
lying land. With the accelerated rise of ocean waters, the current electric distribution system is at
risk as demonstrated by the recent storm activities. The prediction of increased frequency and
severity of storms, it is imperative that investments be made in increasing the resistance of the
grid to water. Today, there is more substation construction that is being built upon pillars. These
pillars not only rise the substation structures off the ground they meet engineering standards for

32. 31
earthquakes. The biggest challenge with be the extensive underground portions of the grids
specifically in large cities like New York and Boston. There will need to be increased investments
in making the grid components water resistant as well as constructing the grid with multiple
ways to divert the electricity from damaged areas.
E. Use New York’s REV as a Model for National Reform
The academic studies and state, regional and national energy plans reviewed in this paper
argue strongly that moving toward a 100% renewable energy nation is both possible and
beneficial. To get to a binding, progressive national energy plan, the U.S. should apply best
practices from these existing state plans and studies -- particularly New York’s REV. REV could
act as a model for system-wide energy reform that includes energy production, management and
consumption. It considers the environmental, economic, social and health impacts in an
integrated and comprehensive manner.
One concern with the New York approach is that it does not yet have the regulatory teeth
to ensure reform, other than the binding but relatively modest RGGI commitments. Thus
combining New York’s integrated approach with lessons from California’s and Hawaii’s
aggressive RPS mandates and the Northeast States’ binding RGGI carbon market would enhance
the REV program and provide greater industry certainty and likelihood of success. Using this
model to complement the Clean Power Plan would put the United States in a strong and critical
leadership position in addressing global climate change.

33. 32
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