A portfolio standard is a mandate requiring electric companies to generate or purchase a certain percentage of their power from renewable energy resources. A portfolio standard also is known as renewable electricity standard. Currently, 30 states, including the District of Columbia, have adopted portfolio standards. Seven states also have renewable portfolio goals.
No two portfolio standards are the same—each state standard includes carefully considered targets, timetables, and eligible resources based on what makes sense for the state. There are significant regional differences in the availability, amount, and types of renewable energy resources, resulting in different regions of the country relying on different fuel mixes.
The electric power industry supports the development of renewable energy resources. We are working to advance the development of renewable energy technologies across the country. However, a one-size-fits all federal portfolio standard raises serious concerns. A federal portfolio standard ignores the specific energy and economic needs of the individual states.
A federal portfolio standard mandate will:
- Raise electricity prices for consumers;
- Affect electric reliability; and
- Result in a significant transfer of wealth from consumers in regions of the country with few renewable resources to distant suppliers and the federal government.