Western Leadership in Clean Energy

While much work remains to be done in the transition to a low-carbon grid, several western states are poised to zero out their emissions ahead of the rest. 

Credit: Source: EIA 2019

Welcome to the Western edition of our blog series highlighting the clean energy achievements and climate action continuing across the United States―despite the Trump administration’s efforts to roll back federal climate policies. Each blog is focused on a different region of the country. (Check out our previous post about decarbonization efforts in the Midwest.)

From New Mexico to Colorado, Nevada to Washington, western states are enacting a flurry of multifaceted landmark climate legislation and initiatives in the absence of clear federal leadership. Collectively, these initiatives have set progressive decarbonization targets, unlocked economic mechanisms for speeding up coal retirements, implemented targets for electric vehicle deployment, and more. Here are just some of the highlights from 2019. 

Shooting for 100% Carbon Free

Western states have made laudable progress towards cleaning up their power sector. Since 2008, carbon emissions from the power sector have dropped by 23 percent as a result of advancement in renewable energy development, increased energy efficiency and coal retirements. With the package of state policies passed this year, these western states are poised to zero out many of those emissions curves. 

Earlier this year, New Mexico became the third state, after California and Hawaii, to aim for a 100 percent carbon-free grid by passing the Energy Transition Act, which requires the state to reach 50 percent renewable energy by 2030 and 100 percent carbon-free electricity by 2045. According to a NRDC analysis, this ambitious renewable target will spur economic benefits and job growth, reduce pollution and improve human health. 

Shortly after, the Nevada legislature unanimously passed its own landmark bill mandating that the state also source 50 percent of its electricity from renewable resources by 2030 and shoot for 100 percent carbon-free generation by 2050. Washington joined its fellow western states in passing a 100 percent carbon neutral bill, with 80 percent of their energy derived from carbon-free resources. By 2030, the state plans to phase out coal completely. 

Colorado also took a big step forward this year with passage of Senate Bill 19-236, which requires Xcel Energy, the state’s largest electric utility, to reduce its CO2 emissions by 80 percent below 2005 levels by 2030. The new policies in New Mexico and Colorado share a notable element: they unlock securitization as a financial tool to accelerate the closure of coal plants. The tool saves customers money and expedites coal retirements by allowing plant owners to forgo a long term interest payment stream in exchange for a more rapid recovery of capital invested in these plants. With coal making up over 46 percent of Colorado’s electricity generation in 2018, the state’s legislation is crucial for addressing unrecovered capital in uneconomic coal plants, one of the biggest barriers to early coal retirements.

Accelerating Renewables, Slowing Down Natural Gas 

As favorable economics of clean energy fuel the precipitous decline in coal, a rush to gas as a transition resource poses a real risk to the U.S. achieving its climate goals. Some Arizona policymakers are well aware of this risk. Early this year, the Arizona Commission extended its moratorium on all new large natural gas capacity, claiming that utilities have not fully considered clean energy alternatives to coal. No other state has taken such a strong stance against headlong and large investments in gas. Along with the Commission's clean energy proposal of reaching 80% carbon free by mid-century- and other proposals currently before the commission (including one joined by NRDC), these initiatives supplement the impressive growth of renewable energy in the region. 

Collectively, utility scale renewable generation in these western states almost tripled since 2008. Wind developments have dominated the renewables mix in Colorado, New Mexico, Oregon and Washington while solar-rich states Arizona and Nevada saw most of the growth in PV investments. 

Paving the Road for Clean Transportation

Addressing carbon emissions from the power sector is just part of the story of deep decarbonization. In both 2017 and 2018, transportation beat out the power sector for the title of biggest carbon dioxide emitter in the U.S. The good news is that states in the west are rolling out policies to tackle this sector that is heavily reliant on fossil fuels. 

As part of the efforts to advance clean vehicle policies Colorado, NRDC submitted a letter in late July with E2 and business leaders across the state to urge the adoption of California’s zero-emission vehicle (ZEV) standard, as ordered by Gov. Jared Polis just days into office. This August, Colorado air commissioners codified Gov. Polis’ order by voting to adopt the ZEV standard, which will require automakers to make 5% of vehicles available for sale electric by 2023 and to increase the actual sales of ZEVs from the current 2.6 percent to more than 6 percent of total sales by 2025. 

Sales of battery electric vehicles (BEV) and plug-in electric vehicles (PHEV) across Western States

Credit: Source: Auto Alliance

To date, of these Western states only Oregon and Colorado have adopted ZEV mandates while policy makers in Washington and New Mexico are still considering joining the existing 10 ZEV states. These mandates do not themselves compel drivers to purchase EVs, but rather requires that manufacturers increase sales to car dealerships. Getting EVs from the hands of dealerships to state drivers will require jumping over many hurdles ranging from public education to charging infrastructure. Arizona, Nevada and New Mexico are introducing (and passing) bills to accelerate utility investment and funding for much needed public charging infrastructure that will work to quell consumer range anxiety, one of the many factors that have stalled EV adoption. 

In a bipartisan bill signed by Governor Lujan Grisham in April, New Mexico is sparking investments in EV infrastructure by requiring state regulated utilities to propose programs with companies to deploy charging infrastructure and removing regulatory barriers on independent EV charging companies. Colorado, which already boasts an impressive number of charging stations, is also working to remove statutory prohibitions on partnerships between utilities and independent charging stations through SB77, passed and signed into law this May. The removal of these prohibitions can help low-income and disadvantaged communities gain access to public charging stations. 

The Arizona Corporation Commission has begun looking into expanding EV adoption through the approval of their EV implementation plan this summer, which would consist of guidelines for utility EV pilot programs focusing on infrastructure, rate design, incentives, rebates and cost recovery. 

Nevada’s legislature ended its 2019 session with a series of clean transportation bills including SB299, which will create a pilot program to fund electric bus fleets in Nevada school districts and SCR3, which will direct the Legislative Committee on Energy to study the benefits of EV adoption in the state. 

Credit: Source: US Department of Energy, Alternative Fuels Data Center

As emphasized in our previous blogs, investments in EV infrastructure would benefit all utility customers, not just EV drivers, through effective utilization of the grid (EV charging at low-cost hours) that would spread the costs of grid maintenance and reduce per-kilowatt-hour price to all customers. 

Investing in the First Fuel—Energy Efficiency

While not as flashy as an electric car, energy efficiency is one of the most powerful weapons against climate change that is, unfortunately, often forgotten. As the nation’s largest energy resource that employs over 2.2 million Americans, energy efficiency has the potential to reduce 2 billion metric tons of CO2 in the US by 2050, as outlined by NRDC’s 2017 pathways report. Here are some of the ways the west is looking to advance this extremely effective climate strategy in their states. 

Nevada bill AB54 fights back against the Trump Administration’s attempt to roll back lightbulb efficiency standards by adopting federal standards into state law before the rollbacks can take place. According to the American Council for Energy-Efficient Economy (ACEEE), this standard would not only save Nevadans $85 million in electricity bills, but will reduce carbon emissions equivalent to a year’s worth of emissions from 60 thousand cars. Other western states are adopting similar backstops to ensure that DOE’s proposed rollback does not come to fruition in their respective regions. This includes Colorado’s new water and energy efficiency standards that cover 16 products, many of which were ignored by illegal DOE delay on passing important energy efficiency standards. The new state policy is expected to save consumers $1 billion on electricity bills, 85 billion gallons of water, and avoid 3 million metric tons of carbon pollution. 

In Oregon, which has long been a leader in energy efficiency, officials revealed a 10-year plan to address the disparity in energy burden and costs for low-income residents through funding for energy efficiency programs. Energy burden—or the percent of household income spent on electricity bills—is particularly higher for low-income households of color. As emphasized by a 2017 report from ACEEE and Energy Efficiency for All (a coalition which includes NRDC), energy efficiency can reduce 35 percent of the average US household energy burden. That potential is even higher for African-American (42 percent), Latino (68 percent), and renting households (97 percent). 

Climate Action Continues

Faced with the task of implementing climate solutions without strong federal action, the west has proved that significant progress can be made at the state level. While much work still remains to be done in the transition to a low-carbon energy system, these western states show no signs of slowing down. 

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