On March 21, Sens. Jeff Bingaman (D-NM) and Lisa Murkowski (R-AK) released a white paper on the design of a Clean Energy Standard (CES) , which would require a certain percentage of the nation's electricity (and potentially thermal energy) to be produced from "clean" resources. The Senators, who are the Chair and Ranking Member of the Senate Energy and Natural Resources Committee, respectively, requested comments on the design elements of a CES — including what resources should count as clean, what role energy efficiency and thermal energy should play, what utilities should be subject to the CES, how a federal standard would interact with the 30 existing state standards, and the role of complementary policies.
To download the full comments submitted by the Environmental and Energy Study Institute, please click here . The executive summary is written below.
The design of a Clean Energy Standard (CES) must set goals and incorporate parameters that focus on explicit positive outcomes. While the rationale for a CES could purely be to address environmental degradation from power plant pollution, it could also be to spur economic development or to keep electric and heating bills affordable to American homes and businesses. If designed accordingly, a CES can achieve all three outcomes.
In other words, what do we want a clean energy standard to do? The goal of a CES is to meet energy needs at minimum impact to people and the planet—which can be broken down into the fundamental elements of air, water, land, and climate. The challenge would be to ensure the following occurs:
- Enable regions to develop their own local clean energy resources;
- Allow markets to determine the most efficient/cost-effective use of clean energy resources, taking into account the cost of environmental externalities;
- Create a self-sustaining market for all clean energy sources, which should be clearly outlined in statute;
- State which pollutants should be reduced;
- Monitor, evaluate and verify pollution reduction, economic development, and effect on energy bills that come as a result of the CES;
- Allow current regional, state, and local plans (e.g. climate action plans, renewable portfolio/energy standards, etc.) to continue operation to minimize costs and uncertainties that come with upsetting existing regulatory frameworks as long as they equal or surpass CES goals;
- Incorporate thermal energy and demand-side energy resources like energy efficiency and distributed generation into the CES in addition to pollution mitigation schemes on the supply side, such as installation of pollution control equipment and making existing generation more energy efficient;
- Ensure that any entities deemed exempt from compliance with the CES have an opportunity to be credited for taking voluntary action;
- Build a revision mechanism into the legislation so that Congress can adapt the goals to changing market and other relevant conditions, such as by adding breakthrough technologies to the list of energy resources and increasing the overall goal should the cost of clean energy drop or the need for non-carbon resources becomes more immediate than expected; and
- Create a framework for cross-sectoral pollution reduction—for example, utilities that aid in the creation of an electric vehicle infrastructure in which they can demonstrate that the pollution reduction taken away from the transportation sector is greater than that increased in the electric sector.