For Obama's Clean Energy Goal, Details Behind the Policies Matter

This post originally appeared on the National Journal Energy & Environment blog.

In his State of the Union address, the president called for a goal of 80 percent clean energy by 2035. If implemented, President Obama’s goal should give American businesses the certainty to make clean energy investments and retool our aging power fleet. By encouraging innovation, this concrete goal will empower American businesses to compete in the global clean energy market, boosting our competitiveness. As Members of Congress develop a clean energy standard to meet this goal, the details behind the policies matter. Questions policymakers will need to address include:

Do technologies count evenly?

For a clean energy standard to be most effective, technologies should compete on an even playing field so that the cleanest, cheapest technologies are the ones that move forward. This lowers overall program costs. Giving certain technologies preferential treatment – for instance, through giving extra credits per megawatt to one technology—could stifle the effectiveness of the standard.

Which technologies count?

Policymakers will need to decide if the clean energy standard will provide incentives for truly transformational clean technologies or lock in the outdated technologies of the past. Will they aim to bring solar, wind and other renewable energy options to scale? Will they incentivize the use of new high-efficiency natural gas turbines? Will they prioritize the application of carbon capture and storage (CCS) for conventional technologies? If done right, a clean energy standard can drive innovation and investment while achieving real greenhouse gas emissions reductions. A broad portfolio of technology options should make an 80 percent target by 2035 attainable if we start soon.

How would the federal clean energy standard interact with state policies?

Any federal standard must ensure that innovation at the state level is protected. While Congress has struggled for years to pass comprehensive energy legislation, the states have led the way in developing renewable energy standards and other incentives that are driving investments in clean technologies today. Congress must ensure that a federal law doesn’t weaken existing state efforts or hinder states from developing the next wave of transformational energy policies down the road.

Which utilities are subject to the standard?

In the past, some federal energy standard proposals have exempted small utilities. The greater the number of utilities exempted from the standard, the harder it will be to reach the 80 percent goal.

Right now, there is no clear path forward for clean power generation in the United States. A clean energy standard will kick start a long-overdue transition to cleaner energy.

It’s important to note, though, that a clean energy standard is not a substitute for policies that regulate greenhouse gases and directly deal with climate change. Greenhouse gas rules and clean energy standards are not mutually exclusive. Much more will be needed to combat climate change, including using existing regulatory authorities and future climate legislation, to avoid the worst impacts. A clean energy goal, however, is a good place to start.