Who Owns the Clean Energy Future? Comparing Public and Private Utilities' Pathways to Decarbonization
Powell, Devyn Weis
Wise, Andrew M
This paper compares investor-owned, public, and cooperatively-owned utilities’ performance in transitioning their power mix to low- or zero-carbon sources, as well as different utilities’ responsiveness to state policy mandates. As the worsening impacts of climate change have accelerated the urgency of transitioning to carbon-free sources of energy, understanding how to design effective policies to decarbonize the power sector — responsible for more than a quarter of U.S. greenhouse gas emissions — is imperative for regulators and policymakers. Most electric utilities in the United States fall into one of three ownership categories: investor-owned, public, and cooperative. A renewable portfolio standard (RPS), which mandates a renewable energy generation target by a certain date, is one of the most widely-adopted state-level policies to drive utilities and other electricity providers to increase their generation of renewable energy. Several RPS policies are designed to exclude certain utility types. In analyzing the relationships between utility ownership, RPS policy design, and renewable generation, this paper finds that investor-owned and cooperative utilities may outperform public utilities in renewable generation, and also finds stronger evidence that RPS policies that are more ambitious in their target and apply to all utility ownership types are more effective at increasing renewable generation at both the utility and the state level.
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