RPS in U.S. would lead to rise in biomass generation

WASHINGTON, DC, USA, July 4, 2007. A 15% renewable portfolio standard in the United States would lead to a “large increase in biomass generation” by 2020, which would grow to 320 billion kWh or three times the level in a reference case, according to the federal Department of Energy.

The Energy Information Administration analysed a RPS that would not allow current output from existing hydroelectric and municipal solid waste facilities to meet the requirement. It would allow electricity providers to generate their own green power or trade renewable energy credits to comply, or purchase credits from the U.S. government at 1.9¢ per kWh credit. Solar photovoltaic would earn three credits for every kWh of generation and the RPS would run until 2030 before it ends.

The report was requested by Senator Jeff Bingaman. At the end of 2006, 23 states and the District of Columbia had enacted a RPS or similar renewable energy requirement. The proposed federal RPS would apply to electricity retailers on a nationwide basis, establishing a target level for the market share of qualifying renewables that would reach 15% in 2020.

In addition to the large increase in biomass, “wind and photovoltaics also show significant increases in generation” and, by 2030, solar installations produce 8% of qualifying green power but account for 20% of total credits held because of the triple credits. The increased use of renewables in the RPS leads to lower coal generation, and generation from nuclear and natural gas are also lowered to a smaller degree.

After adjusting for the exemption of small power providers and removal of existing hydroelectric and MSW facilities, the target for green power is equivalent to 12% of total electricity sales in 2030. Relative to the reference case, retail power prices rise by an average of 0.9% from 2005 to 2030 with the RPS, and reduced demand for coal and natural gas results in slightly lower prices for those fuels.

Total electricity-sector emissions of CO2 are reduced by 222 Mt (6.7%) in 2030 relative to the reference case, when emissions from this sector are projected to account for 40% of total energy-related carbon emissions. From 2005 to 2030, cumulative energy-related carbon emissions are reduced by 2,925 Mt (1.7%), the report notes.

The RPS analysed in the EIA report would begin in 2010 with a required share of green power at 3.75% and grow to 7.5% in 2013, 11.25% in 2017 and 15% percent in 2020. The program would sunset in 2030. Power sellers with retail sales of 4 billion kWh (4,000,000 MWh) would be covered.

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