Renewable Energy

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Federal, state, and local governments and electric utilities encourage investing in and using renewable energy and, in some cases, require it. Many programs and incentives are currently available.

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Government financial incentives Several federal government tax credits, grants, and loan programs are available for qualifying renewable energy technologies and projects. Grant and loan programs may be available from several government agencies, including the U. Department of Agriculture, the U.

Department of the Interior. Most states have some financial incentives available to support or subsidize the installation of renewable energy equipment.

Renewable portfolio standards RPS and state mandates or goals A renewable portfolio standard RPS typically requires that a percentage of electric power sales in a state comes from renewable energy sources. Some states have specific mandates for power generation from renewable energy and some states have voluntary goals. Renewable Energy Certificates or Credits RECs RECs , also known as green certificates, green tags, or tradable renewable certificates, are financial products that are available for sale, purchase, or trade.

RECs allow a purchaser to pay for renewable generation without directly obtaining the electricity generated from qualifying energy sources. Net metering Net metering allows electric utility customers to install qualifying renewable energy systems on their properties and to connect the systems to an electric utility's distribution system or grid.

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The programs vary, but in general, electric utilities bill their net metering customers for the net amount of electricity the customers use during a defined period. The net amount is the customer's total electricity consumption minus the amount of electricity that the customer's renewable system generates.

In some states, customers can sell the excess electricity that they generate with their systems to the utility. As of November , 38 states and the District of Columbia have state-developed mandatory net metering rules for certain utilities. Two states do not have statewide rules, but some utilities in those two states allow net metering, and seven states have statewide-distributed generation compensation rules other than net metering.

Most net metered systems are solar photovoltaic systems. Feed-in tariffs FITs Several states and individual electric utilities in the United States have established special rates for purchasing electricity from certain types of renewable energy systems. These rates, sometimes known as feed-in tariffs FITs , are generally higher than retail electricity rates to encourage new projects of specific types of renewable energy technologies.

Green power purchasing Consumers in nearly every state can purchase green power , which represents electricity generated from specific types of renewable energy resources. Most of these voluntary programs generally involve the physical or contractual delivery of the electricity generation resource to the customer or utility.

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Ethanol and other renewable motor fuels Several federal and state requirements and incentives are in effect for the production, sale, and use of ethanol, biodiesel, and other fuels made from biomass. The federal Energy Independence and Security Act of requires that 36 billion gallons of biofuels be used in the United States per year by Several states have their own renewable fuel standards or requirements.

Other federal programs provide financial support and incentives for ethanol and other biofuels producers. Many states have their own programs that support or promote the use of biofuels. Renewables research and development The DOE and other federal government agencies fund research and development of renewable energy technologies.

Most of the research and development is carried out at the National Labs and in cooperation with academic institutions and private companies.

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The availability of these programs depends on annual appropriations from the United States Congress. Source: Stock photography copyrighted. As of July , 29 states and the District of Columbia had enforceable renewable portfolio standards RPS or other mandated renewable energy policies, and 8 states had voluntary goals or objectives for renewable energy generation.

Renewable portfolio standards RPS , also referred to as renewable electricity standards RES , are policies designed to increase the use of renewable energy sources for electricity generation. These policies require or encourage electricity suppliers to provide their customers with a stated minimum share of electricity from eligible renewable resources. Although national RPS or other clean energy policies have been proposed, no federal RPS or similar policy is currently in place.

However, most states have enacted their own RPS programs. State RPS programs vary widely in terms of program structure, enforcement mechanisms, size, and application. No two state programs are exactly the same. A wide range of policies fall under the RPS umbrella. In general, RPS set a minimum requirement for the share of electricity supply that comes from designated renewable energy resources by a certain date or year.

Generally, these resources include wind, solar, geothermal, biomass, and some types of hydroelectricity, but they may also include other resources such as landfill gas, municipal solid waste, and ocean energy. Some programs also give credits for various types of renewable space heating and water heating, fuel cells, energy efficiency measures, and advanced fossil-fueled technologies.


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Some states set targets for specific types of renewable energy sources or technologies to encourage the development and use of those resources. Some states focus the RPS requirement on large investor-owned utilities, while others apply the standards to all utilities. A utility that generates more renewable electricity than the RPS requirement may either trade or sell RECs to other electricity suppliers who may not have enough RPS-eligible electricity to meet their RPS requirements. Some states make a certain number of credits available for sale. In general, only one entity—the generator or the REC holder—may take credit for the renewable attribute of generation from RPS-eligible sources.

In addition to the cost control mechanism of a REC, many RPS programs have escape clauses if renewable generation exceeds a specified cost threshold. States with and without RPS policies have seen increases in the amount of electricity generation from renewable resources. Do you have a clean energy idea or start up? Check out these two contests that give young entrepreneurs the opportunity to show off their ideas!

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View Blog. The energy harnessed from moving water can be used to create electricity; the two most common technologies for this are - Hydropower and Tidal Power.


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