State Policies Supporting Renewable Energy Development
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1 State Policies Supporting Renewable Energy Development Susan Gouchoe North Carolina Solar Center at NCSU Pace University/UNDESA Renewable Energy Meeting New York, NY April 8, 2004
2 Presentation Overview 1. State Renewable Energy Policies 2. National Database of State Incentives for Renewable Energy (DSIRE)
3 State Financial Incentives Personal Income Tax Incentives (22) Corporate Income Tax Incentives (28) Rebates (14) Grants (21) Production Incentives (11) Low-interest Loans (19) Sales Tax Exemptions (19) Property Tax Incentives (25) Industry Recruitment Incentives (9)
4 State Regulations & Policies Renewable Portfolio Standards/Goals (15) Public Benefits Funds (15) Net Metering (3) Green Power Purchasing Policies (7) Requirements for a Green Power Option (5) Interconnection (37) Fuel Source & Emissions Disclosure (24) Solar & Wind Access Laws (33) Construction & Design Policies (9) Contractor Licensing (9) Equipment Certification (7)
5 Corporate Tax Credits & Deductions Range from 10% - 35%; $1,000 - $10M Most are for several technologies usually solar, wind, biomass A few states use production-based credits Most states allowing carryover of any unused credits Multi-technology Single technology 3 states have declining credits over time
6 Public Benefit Funds for Renewables Cumulative $95 M $2,048 M $10 M $111 M $22 M $127 M $85 M $80 M $20 M MA: $383 M RI: $10 M CT: CT: $275 $338 mil M NJ: $279 M DE: $11 M $234 M 15 State Funds = $3.8B by 2012 Funded by Voluntary Contributions
7 PBFs: Activities Funded Investments in Companies & Projects Industry & Infrastructure Development Marketing, Business Development, Education, Technical Assistance Small-Scale Project Incentives Grants, Loans, Rebates Utility-Scale Project Incentives Production Incentives, Grants, Equity Investments, Loans, Subordinated Debt Financing, Targeted RFPs
8 PV Grants & Rebates Primarily in states with a PBF $2-$6/W or 20%-70% of cost Some incentives are based on production Most also apply to small wind Some apply to biomass and fuel cells
9 Financial Incentives: Best Practices Generous incentive, declining over time Easy application process Stable funding source Cost-effective quality assurance mechanism Qualified Installers Partnerships - banks, installers, NGOs
10 Financial Incentives: Best Practices Utility cooperation - interconnection Public sector eligibility Flexibility Track program usage details See: Case Studies on the Effectiveness of State Financial Incentives for Renewable Energy
11 Utility-Scale Support: Lessons Learned States have had varying success using grants, loans, production incentives Long-term power purchase agreements are critical to project development Stable demand from RPS and green power markets important Structure program such that state incentives to not reduce value of federal production tax credit Source: Utility-Scale Renewable Energy Projects: A Survey of Clean Energy fund Support
12 Renewables Portfolio Standards CA: 20%by 2017 *NV: 15% by 2013 *AZ: 1.1%by 2007 *NM: 10% by 2011 MN: 1,125 MW wind by 2010 WI: 2.2% by 2011 IA: 105 MW TX: 2,880 MW by 2009 ME: 30% by 2000 MA: 4% by 2008 *CT: 10% by 2010 *NJ : 4.0% by 2008 PA: varies by utility 15 States with an RPS or RP Goals State RPS Non-punitive goals RPS in utility settlements
13 RPS Issues Renewable Resource Eligibility Existing vs. New Resources Utilities Subject to Requirement The Goal - Percentage of Sales or Capacity Duration Location of Resources Tradable Credits Compliance Mechanisms
14 Renewables Expected from Standards & Funds 22,000 20,000 18,000 16,000 14,000 13,280 MW new renewables 7,460 MW existing renewables CO2 reduction equivalent to * 1.7 billion more trees * 5.7 million less cars Source: Union of Concerned Scientists 17,310 MW New Renewables Other* California Megawatts 12,000 10,000 8,000 6,000 4,000 2, *Includes Illinois, Montana, Oregon, Pennsylvania and Rhode Island. New York Nevada AZ & NM Texas Minnesota IA & WI New Jersey Connecticut Massachusetts Maine
15 Net Metering Rules Net metering is available in 38 states + D.C. State-wide net metering for certain utility types Net metering offered by one or more individual utilities
16 Net Metering: Issues & Best Practices Qualifying technologies renewables, other distributed energy technologies Maximum system size / enrollment range from <10 kw to no limit / 0.05% of peak to no limit Utilities subject to requirement IOUS? RECs? Munis? Treatment of net excess generation carryover to next month, receive retail/avoided/no cost for NEG Interconnection no defined stds, requirements based on national stds., or other stds.
17 Green Power Procurement Policies 7 states have established green power purchasing targets for state government Illinois 5% by 2010; 15% by 2020 Pennsylvania 5% New York 10% by 2005; 20% by 2010
18 Database of State Incentives for Renewable Energy The DSIRE Project
19 DSIRE Features 1. Up-to-date policy information types of policies & incentives program summaries 4. Contacts 5. Links to program web sites 6. Access to relevant legislation & policies 7. Search capabilities using different criteria 8. Summary tables & maps 9. Available at
20 DSIRE Project Scope Implementing Organizations Federal, State, Territory, Local Utility, Non profit, For profit Incentive Categories Financial Incentives Rules, Regulations & Policies Outreach & Voluntary Programs
21 Technologies Solar Wind Geothermal Biomass Hydroelectric Fuel Cells Renewable Fuels & Vehicles
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27 Search Criteria 1. State or community 2. Eligible sector residential, commercial, non profit, schools, etc. 2. Implementing sector federal, state, local, utility, private, non-profit 3. Technology solar, wind, etc. 4. Incentive type RPS, net metering, grants, etc.
28 Summary Table provides comparison of policies available in each state indicates state, local & utility incentives using color-coded buttons
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31 DSIRE Project Online
32 Contact Information Susan Gouchoe Policy Program Manager NC Solar Center NC State University
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