As Washington Backs Off Clean Energy, States Are Filling the Void

As a group, states are already doing more to support clean energy development than the federal government ever dreamed of.

President Obama released his first campaign ad this week, which touts his credits on clean energy. But while the president has gone further toward supporting clean energy than any other environmental policy, the federal policies that were hustling wind and solar projects into existence have expired under his watch. Renewable-energy advocacy groups are pushing to reinstate those incentives, but they're also shifting focus to the states: The Solar Energy Industries Association, the industry’s lead trade group, recently merged with the state-focused Solar Alliance to beef up its expertise on the kaleidoscope of policies emerging from legislatures across the country.

As a group, states are already doing more to support clean energy development than the federal government ever dreamed of. At the end of 2010, all but four states (Alabama, Missisippi, Tennessee, and Idaho) had approved a clean-energy policy of one kind or another. For states looking to increase their clean energy potential, the National Renewable Energy Laboratory advises using "suites of policies applied in succession” [PDF], with lower-cost strategies coming first. In other words, start small, with projects that will prove their worth quickly, then scale up as governments and citizens become more comfortable with green technology. There are three major areas in which state governments have a chance to make a significant impact in the clean-energy sphere without needing help from Congress.

Standards. State governments have the power to mandate certain outcomes. In clean energy, the two most important requirements for states to enforce are building codes and renewable-portfolio standards. Building codes can require certain levels of energy efficiency in new construction, for instance, which can lock in energy savings over the decades-long lifespan of a building. Renewable portfolio standards require utilities to source a fixed percentage of their power from renewable sources by set deadlines.

Connections. Renewable energy installations aren’t much use unless they connect back to the grid, so states need rules for distributed energy sources like rooftop solar to connect back to the grid. Regulations like these also make it possible for the owners of distributed-energy sources to sell power back to the grid or receive credit on their energy bills for the power they contributed.

Money. In the end, though, growing clean energy means building more renewable power projects, which requires financing. States have such a range of programs in place—including grants, rebates, loans, and loan guarantees—that researchers looking at state-level policies have had a difficult time deducing which ones are working best. The Brookings Institution released a report this month advocating creation of state clean energy funds to support individual projects. Brookings sees these funds as a potential engine of innovation, too, funding clean-energy startups and cutting-edge research and development.

While the federal government backs off from its support of clean energy, state policies like these are increasingly essential for the industry’s continued growth. State-level regulations have a trickle-down effect, too: It’s easier for local governments to push for clean energy in states with strong frameworks. Of course, that would be true for federal level policies, too—while it's heartening that states are taking initiative, they would be able to achieve more with some increased leadership from Washington.

Photo courtesy of the National Renewable Energy Laboratory

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