Clean Power Incentives
What are the trends in clean power costs and policies?
Advances in technology, declining costs, and market-based strategies have helped increase the portion of clean energy in the region’s energy portfolio. To meet our climate and economic challenges, it is critical that we build on this progress with sustained commitments to clean power.
Recent cost trends for new utility-scale generation technologies increasingly favor renewables
Even before factoring in state and federal incentives, the costs of many renewable technologies have declined in recent years, as depicted in this chart of national averages. The levelized cost of energy (LCOE) reflects the “all-in” cost of generating electricity over the life of the plant (cents/kWh), taking into account costs for capital, operations and maintenance, and fuel. Declining costs for new utility-scale renewable technologies have made renewables more cost-competitive with conventional resources.
Renewable Portfolio Standards have encouraged the growth of renewable power at the state level
All eight Northeast states have Renewable Portfolio Standards (RPSs) or equivalent policies. RPS policies support new renewable generation by requiring that increasing proportions of retail electricity be supplied by renewable sources. Eligible technologies and specifics vary by state.
RGGI demonstrates that a regional market-based regulatory program can work
States participating in the Regional Greenhouse Gas Initiative (RGGI), a market-based cap and trade program to reduce power plant greenhouse gas emissions, recently agreed to reduce the overall emissions cap by 45%. This reform locks in significant reductions in electric sector emissions and ensures a continuing decline in emissions. RGGI revenue supports energy efficiency and other clean energy programs across participating states, creating jobs and further reducing demand for fossil fuels and emissions in the region.