Renewable Portfolio Standards

NLR provides information and resources for states on renewable portfolio standards (RPSs), also known as a renewable electricity standards.

Background

An RPS provides a mandate for renewable energy sales within a state. This—in combination with federal financial mechanisms and other federal, state, and local policies—is an important factor influencing energy project development. States often design RPSs to incentivize a particular technology by providing "carve out" provisions that mandate a certain percentage of electricity generated comes from a particular technology. States can choose to apply the RPS requirement to all utilities or only the investor-owned utilities. States can also define what technologies are eligible to count toward the RPS requirements.

Implementation Issues

Having adequate transmission capacity to accommodate generation from new energy resources is important for the success of an RPS. States with successful RPSs either have adequate transmission available or plans to build it.

Also, see Renewable Portfolio Standards: Understanding Costs and Benefits.

Design Best Practices

When designing an RPS, incorporate the following best practices:

RPS targets should be stable over time and not be subject to sudden or uncertain shifts.
An RPS program should be of sufficient duration to allow for long-term contracting and financing.
An RPS program should apply to all load-serving entities: investor-owned, municipal, and electric cooperatives, including suppliers of last resort.
The eligibility of specific energy technologies and generators should be well defined.
Use of tradable renewable energy credits for RPS compliance should be considered and adhered to with a robust tracking system.
The cost of RPS compliance should be allocated across utility customers.

NLR Publications

Renewable Portfolio Standard Assessment for Alaska’s Railbelt, NLR Technical Report (2022)

International Best Practices for Implementing and Designing Renewable Portfolio Standard Policies, NLR Technical Report (2019)

Additional Resources

Renewable Portfolio Standards: Understanding Costs and Benefits, NLR

Renewables Portfolio Standards Resources, Lawrence Berkeley National Laboratory

Database of State Incentives for Renewables and Efficiency, NC State University