Panel Paper: Efficiency and Renewable Energy Policies: Assessing Policy Stringency and Drivers of Adoption

Saturday, November 10, 2012 : 2:45 PM
Hanover A (Radisson Plaza Lord Baltimore Hotel)

*Names in bold indicate Presenter

Sanya Carley and Christopher Miller, Indiana University

Renewable energy policy has far-reaching implications for national and international economic, environmental, and political sustainability. Within the U.S., however, it has thus far been almost entirely the province of state governments. State policy activity in this realm provides an accessible comparative context for scholars, and considerable research has been conducted into the factors motivating adoption of state-level renewable energy policies, with particular attention to the renewable portfolio standard (RPS), a popular and flexible model that incorporates graduated goals over time. Recent work on RPSs highlights the distinction between degrees of policy stringency, ranging from entirely voluntary participation to rigorous and strictly enforced targets, a distinction which not only has implications for policy effectiveness  but also for policy adoption at the outset. Analyzing the relationship between stringent policy design and drivers of RPS adoption, this research has found that when variations in stringency are properly accounted for in an analytical model, RPS policies of different levels of stringency reveal themselves to be motivated by systematically different underlying factors.

Renewable energy policies are not the only state-level energy policy instrument that varies by stringency. Energy efficiency and distributed generation policies, for example, also demonstrate significant variations in policy design across states, which plausibly influence both the adoption and the implementation of these policies. In this comparative policy analysis, we devise stringency metrics for energy efficiency resource standards (EERS) and net metering (NM) standards, along with the previously used RPS metric. Using an event history analysis approach with a multinomial logit, we test empirically the relationship between internal state factors (e.g., political ideology and electricity price), external factors (e.g., influence from surrounding states), and policy adoption. Our objectives are twofold: first, to establish whether differences in policy stringency are important to consider in the evaluation of these policies, just as they are for the RPS; second, to determine how the significant factors influencing RPS adoption (such as political ideology) may differ from those influencing EERS and NM policies, thus potentially situating these policies as either complements or competitors to one another. We hypothesize that we will find some significant differences between our three models, with more substantive, evidence-based variables involving, e.g., economic development and government capacity driving NM policies, in contrast to the political factors underlying the RPS, with EERS policies situated in the middle of the spectrum. Our hypothesis is grounded in the distinction that NM represents a policy model that is relatively intuitive to understand and uncontroversial, whereas the RPS is both more complex and more politicized, while the EERS shares elements of both.

These findings may inform more effective policy choices in states and, perhaps, nationally, if and when sustainable energy policy again moves forward on the national policy agenda. Meanwhile, the stringency metric central to this analysis may be adapted for use by other policy scholars concerned with topics both within and beyond the realm of energy policy.