Report: State RPS Policies Will Drive 250% Increase In RE Generation

State renewable portfolio standards (RPS) will be the most critical driver determining the pace of U.S. renewables growth going forward, according to a new IHS Emerging Energy Research market study ‘U.S. RPS Markets and Utility Strategies: 2010-2025.’ IHS estimates that cumulative renewables demand across all states with binding RPS policies will grow from an expected 137 TWh this year to 479 TWh by 2025 – an increase of approximately 250%.

As of June, mandatory RPS policies, which require states to procure a percentage of generation from renewable energy, have been passed in 31 U.S. states and the District of Columbia, with six additional states approving conditional or non-mandatory renewables goals. While utilities in a few states, led by Washington, Maine, Colorado and New Hampshire, are already well on their way toward meeting their 2015 RPS targets, the majority of states will require rapid renewables growth if they are to meet near-term objectives, according to the report.

RPS policies are estimated to require more than 1,000 investor-owned utilities, load-serving entities and competitive retail suppliers to procure renewable power over the next decade, according to the study. Beginning this year, significantly escalating RPS demand will create gradually intensifying compliance pressure across the U.S., the report says.

‘The next five years will be especially critical as the industry faces its first real test of a significant ramp-up in RPS demand,’ says Alex Klein, IHS Renewable Power research director. ‘Before the industry can attempt to reach already lofty longer-term renewable energy goals, utilities and regulators must prove in the next few years that they can reach initial compliance with the RPS targets coming due in many U.S. states.’

According to the study, state RPS would be significantly strengthened if complemented by a federal RPS or energy policy that addresses transmission bottlenecks and siting issues on federal lands, both of which will be critical to sustaining renewables growth toward the middle of the next decade.



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