Emissions reductions from expanding state-level renewable portfolio standards

Area of Science:

• Environmental Science
• Energy Policy
• Economics

Background:

• State-level Renewable Portfolio Standards (RPS) are primary drivers for renewable energy expansion in the U.S.
• Interconnected electricity grids complicate the assessment of state-level energy policy impacts.
• Economic dispatch and renewable project selection models are crucial for evaluating energy policies.

Purpose of the Study:

• To develop and apply a novel method for evaluating emissions reductions and costs associated with expanding Renewable Portfolio Standards (RPS).
• To assess the impact of various RPS expansion scenarios on CO2, SO2, and NOx emissions intensity in Michigan.
• To determine the cost-effectiveness of CO2 mitigation through RPS implementation in the absence of federal subsidies.

Main Methods:

• Integrated economic dispatch and renewable project selection models.
• Evaluated Michigan's RPS expansions to 20%, 25%, and 40% renewable penetration against a 10% business-as-usual (BAU) baseline.
• Analyzed power purchase agreements, generation/capacity costs, and interstate energy trade impacts.

Main Results:

• Expanded RPS policies reduced CO2 intensity by 13%-33%, SO2 by 13%-34%, and NOx by 12%-31% by 2035 relative to BAU.
• Absolute CO2 emissions intensity decreased by up to 22% in the 40% RPS scenario by 2035.
• 26%-31% of emissions reductions occurred in neighboring states due to grid interconnectedness.
• CO2 mitigation costs ranged from $28 to $34 per ton without federal subsidies.

Conclusions:

• Expanding RPS is an effective strategy for reducing emissions intensity, though absolute reductions are moderated by load growth.
• Interstate emissions impacts highlight the complexities of state-level climate policy in a connected grid.
• RPS implementation offers a quantifiable, albeit subsidized, pathway for CO2 mitigation.