Policy Documents

Research & Commentary: Colorado Renewable Portfolio Standard

April 12, 2013

Colorado legislators are bucking the national trend and considering a proposal that would boost the state’s renewable portfolio standard (RPS). The RPS requires utilities to obtain a specified percentage of their power from intermittent renewable sources by a certain date. Twenty-two of the 29 states with such mandates in place have considered changing those laws over the past two years.

Colorado’s current RPS requires cooperatives and their utility suppliers to get 10 percent of their electricity from renewables by 2020. SB 252 would increase the percentage, mandating 25 percent of their electricity come from renewable sources by 2020.

Supporters of the RPS say the mandates are necessary to reduce pollution, will lead to the creation of “green” jobs, and will only marginally increase electricity prices. However, there is little evidence the mandate will benefit the environment. Renewable sources such as wind and solar technologies are intermittent and thus require fossil fuel generators for backup. Running fossil fuel generators in this way can emit more pollutants than when used as primary power sources.

A report from the Colorado-based analytics company Bentek Energy evaluated this problem and found, “While meeting RPS-mandated wind generation requirements appears to have a minimal impact on CO2, it appears to appreciably increase SO2 and NOX.”

A 2011 joint report by the American Tradition Institute and Beacon Hill Institute found the mandate would increase Colorado’s electricity prices by an average of 3.75 cents per kilowatt-hour (kWh), a 40 percent rise. By 2015 this will lead to the loss of 6,000 to 29,000 jobs, according to the Beacon Hill Institute estimates.

Rolling back the Colorado renewable portfolio standard, instead of increasing it, would help keep energy more affordable for consumers, attract more business investment, and increase job creation. It would also allow more efficient use of these resources and minimize dangerous emissions. Colorado should not pick economic winners and losers by mandating the use of certain types of energy; instead, the state should encourage the development of economically competitive energy sources through non-distorting tax and regulatory policies. 

The following documents provide additional information about renewable portfolio standards.

 

Ten Principles of Energy Policy
http://heartland.org/policy-documents/ten-principles-energy-policy
Heartland Institute President Joseph Bast outlines the 10 most important principles for policymakers confronting energy issues, providing guidance to help withstand ongoing changes in markets, technology, and policies adopted in other states, supported by a thorough bibliography. 

The Status of Renewable Electricity Mandates in the States
http://heartland.org/sites/all/modules/custom/heartland_migration/files/pdfs/29330.pdf
The Institute for Energy Research analyzed the practical effects of renewable electricity mandates and found states with mandates have on average 40 percent higher electricity rates than those without such mandates. 

Study of the Effects on Employment of Public Aid to Renewable Energy Sources
http://heartland.org/policy-documents/study-effects-employment-public-aid-renewable-energy-sources
Researchers at King Juan Carlos University in Spain found each “green job” created in Spain cost about $750,000. Electricity rates would have to be increased by 31 percent to account for the additional costs of renewables. 

How Less Became More: Wind, Power and Unintended Consequences in the Colorado Energy Market
http://heartland.org/policy-documents/how-less-became-more-wind-power-and-unintended-consequences-colorado-energy-marke-0
Bentek Energy, LLC, a leading energy markets information company, evaluates the “must take” provisions of Colorado’s Renewable Portfolio Standard, which forces coal plants to accommodate the intermittency of wind power by “cycling” generating units. The report finds the requirement results in inefficiency and produces significantly greater emissions. 

Wind Farms vs. Wildlife
http://heartland.org/policy-documents/wind-farms-vs-wildlife
Clive Hambler, lecturer in biological and human sciences at Oxford University and a trained zoologist specializing in species extinction, describes how wind turbines wreak havoc on wildlife. 

U.K. Study: Renewable Fuels Kill Jobs
http://news.heartland.org/newspaper-article/2011/03/14/uk-study-renewable-fuels-kill-jobs
A 2011 study by Verso Economics, a UK-based economic consultancy, found renewable power killed 3.7 jobs in Great Britain for every “green job” created. The UK’s “renewable obligation” cost the country an additional $2.3 billion in 2009-10 when all economic costs, including electricity prices, were considered. 

The Economic Impact of Colorado’s Renewable Portfolio Standard
http://heartland.org/policy-documents/economic-impact-colorados-renewable-portfolio-standard
This American Tradition Institute study quantifies the economic harm caused by renewable energy subsidies and mandates.

 

Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this and other topics, visit the Environment & Climate News Web site at http://news.heartland.org/energy-and-environment, The Heartland Institute’s Web site at http://www.heartland.org, and PolicyBot, Heartland’s free online research database, at www.policybot.org.

If you have any questions about this issue or The Heartland Institute, contact Heartland Institute Policy Analyst Taylor Smith at tsmith@heartland.org or 312/377-4000.