WRI’s fact sheet series, How States Can Meet Their Clean Power Plan Targets, examines the ways states can meet or even exceed their standards under the Clean Power Plan while minimizing compliance costs, ensuring reliability and harnessing economic opportunities. This post explores these opportunities in Wisconsin.
The Clean Power Plan (CPP) calls for Wisconsin to reduce its power sector emissions 34 percent below 2012 levels by 2030. While the U.S. Supreme Court has temporarily halted CPP implementation while legal challenges are considered, this stay is not a reason for Wisconsin to stop planning for a lower-carbon power sector. New WRI analysisshows Wisconsin can harness economic opportunities in clean energy and put the state in a strong position to meet or even exceed its CPP targets.
The state can reduce its power sector emissions 21 percent below 2012 levels by 2030 just by following through on its existing clean energy policies and making more efficient use of existing power plants. By expanding its clean energy policies, Wisconsin can go well beyond its CPP target, reducing emissions 64 percent below 2012 levels by 2030.
Getting from Here to There
While Wisconsin’s power plant emissions in 2012 were 24 percent below 2005 levels due to reduced coal generation, increased energy efficiency, and increased use of natural gas and renewables. However, without any new policies to promote a continued shift toward a cleaner power sector, emissions are projected to grow 5 percent between 2012 and 2030.
But by taking the following three steps, Wisconsin can reduce emissions and exceed its CPP target:
Capturing more energy efficiency: Wisconsin offers money-saving efficiency programs to homes and businesses through its Focus on Energy initiative. As part of this program, the state has adopted annual electricity savings targets of about 0.8 percent of sales, with current targets approved through 2018. Wisconsin can scale up the benefits of this program by ramping the savings targets up to 2.5 percent by 2025, the upper range of what other states are aiming to achieve with their efficiency programs.
Scaling up use of renewable energy: Wisconsin reached the goals of its renewable portfolio standard, which requires 10 percent of investor-owned utility sales to come from renewables by 2015, two years early. Building on this progress to increase generation to 30 percent by 2030 can help cut emissions further.
Making more efficient use of existing natural gas and coal plants: Combined cycle natural gas plants in Wisconsin generated less electricity than they were capable of in 2012 (running at only 31 percent capacity). Running existing natural gas plants at 75 percent and making low- and no-cost operational improvements at existing coal plants could help further cut emissions.
Maximizing the CPP’s Economic Benefits in Wisconsin
Using market-based carbon pricing programs — like a cap-and-trade program or carbon tax — and increasing investment in energy efficiency and renewable energy can not only cut emissions, but yield economic benefits for the state:
Every dollar invested in Focus on Energy from 2011-14 returned $3 in benefits, saving homes and businesses a cumulative $1.7 billion.
Increasing the renewable portfolio standard to 25 percent by 2025 could lead to more than $2 billion in new capital investment in the state and $600 million in lease payments to landowners.
Wisconsin could take in $100 million every year from 2022-2030 by taking the three steps above and selling surplus carbon credits to other states (assuming a $10 per ton price). The CPP encourages states to trade credits.
Wisconsin Should Move Forward with Clean Energy Policies
Even with the stay on the Clean Power Plan, Wisconsin has every reason to move forward with its transition to a lower-carbon power sector. The state’s clean energy policies are already reducing emissions and saving money for the state’s residents. Weakening its clean energy policies will reduce these benefits and make future compliance with the CPP more costly.