As the Obama administration announces a 20 percent national goal for renewable electricity generation by 2030, today the American Council On Renewable Energy (ACORE) is releasing a public policy insights package for lawmakers and regulators. The package consists of two reports detailing sector recommendations for public officials working on renewable energy policy, and the impact of various policy scenarios on private sector investment in renewables.
"From Washington, D.C. to the 50 state capitals, energy policy is a matter of critical importance," said Dan Reicher, interim President and CEO of ACORE and Executive Director of the Steyer-Taylor Center for Energy Policy & Finance at Stanford University. "With the right policies in place, the White House's announcement yesterday seeking 20 percent renewable electricity by 2030 is achievable. However, the question remains whether Congress and state lawmakers will back the impressive progress of the American clean energy industry over the last several years."
Part I of the ACORE policy pack, titled: Setting the Renewable Energy Policy Agenda: Insights from ACORE's 2015 National Renewable Energy Policy Forum, emphasizes the risk to the sector due to policy uncertainty, and outlines several policy recommendations at both the state and federal level:
Extend the federal renewable energy tax incentives: Congress should extend the PTC and ITC now, without waiting for comprehensive tax reform, to avoid a market cliff for renewables.
Consider other improvements to renewable energy incentives: These include expansion of MLPs to cover renewable energy, changes to start-of-construction rules, changes to passive-active rules and reinvigoration of state Renewable Portfolio Standards.
Support the domestic renewable fuels industry: The biofuels industry, like all parts of the energy industry, depends on access to customers and stable policy in order to attract the necessary capital to grow.
"Advancements in renewables are redefining the energy landscape in America today," said Joe Desmond, Senior Vice President of Marketing and Government Affairs for BrightSource Energy. "If we want our nation to stay competitive and continue to develop clean energy resources domestically, then our public policy needs to reflect this. ACORE's research makes a very compelling case for public investment in the future of our nation's energy infrastructure."
Part II of the ACORE policy pack, titled: Why Policy Matters: Renewable Energy Market Momentum at Risk, is authored by ACORE's US Partnership for Renewable Energy Finance (US PREF) and presents data and analysis illustrating the unacceptable market cliff derived from inaction on public policy.
The report specifically notes that new wind installations are forecasted to fall 73%, to 2.3 GW in 2017, due to inaction on the Production Tax Credit (PTC). Additionally, the Investment Tax Credit (ITC) is scheduled to decrease from 30% to 10% in 2016 for commercial solar systems and will expire altogether for residential solar systems. The report indicates that this ITC step down and expiration is forecast to cut solar installations by almost 50% and is already affecting the market.
- Other sections in the report include:
- Renewable Energy Policies Are Saving Consumers Money
- Historical Impact of Finance Policies: Massive Private Capital Investment
- Impact of Renewable Energy Finance Policies: MACRS
- Benefits of Extending Master Limited Partnerships (MLPs) to Renewable Energy Projects
"Renewables have enjoyed a long history of bipartisan policy support," said ACORE's Senior Vice President for Policy and Chief Strategy Officer, Todd Foley. "We see today that renewable technologies are rapidly growing, with increased demand from consumers and companies alike. However, as market analysis demonstrates, without action by Congress soon on the important tax policies we are likely to see a dramatic reduction in renewable energy deployment. The fastest growing source of new electricity in the United States over the last five years -- renewable energy -- is facing a market cliff due to an uncertain policy signal from Washington."