Renewable quotas don’t cut emissions on their own — study

Source: Benjamin Storrow, E&E News reporter • Posted: Friday, November 30, 2018

Renewable portfolio standards are an excellent way of getting more wind and solar onto the grid. What they’re not as good at: reducing greenhouse gas emissions.

That’s the conclusion of a new study by the Organization for Economic Cooperation and Development, which found a weak correlation between renewable energy quotas, high net-metering prices and emission reductions.

There is a lengthy list of reasons for the finding, but it can be broken out into two broad categories. First, renewable policies are often unaccompanied by wider climate policies that might drive greenhouse gas reductions, like, say, a strong price on carbon emissions. Second, their impacts are often offset by subsidies and policies designed to support fossil fuels.

“Climate policy doesn’t exist in a vacuum,” said Brilé Anderson, a co-author of the report. “You at the same time have to pay attention to the brown side of the equation. If you don’t think about phasing out fossil fuels or carbon capture opportunities, then the effect is limited.”

The findings come as climate negotiators prepare to descend on Katowice, a coal-mining town in southern Poland, for a U.N. climate summit. Poland highlights the dynamic facing the 36 OECD member nations, which hail from North America, Europe and Asia. Even as Polish renewable capacity and generation have increased between 2000 and 2015, the per-capita carbon intensity of Polish electricity generation has fallen only slightly.

The trend points to one of the largest impediments to climate policy: the size of a country’s fossil fuel workforce. Poland remains one of Europe’s largest coal burners. More than 1 percent of its labor force is employed in fossil fuels. That number may sound small, but among OECD nations, it is eclipsed only by Canada.

Tackling the economic transition associated with the shift from fossil fuels, the OECD study argues, is one of the most important ways of advancing broader climate policy.

Poland is perhaps one of the more extreme examples, but it is hardly alone. The findings are mirrored across all but a handful of OECD nations.

When the International Energy Agency released its annual report on global emissions earlier this year, it reported that the United States, the United Kingdom, Japan and Mexico — all OECD members — were the only countries in the world to observe emission reductions in 2017 (Climatewire, March 23).

“Essentially, you have countries adding more renewables that the [carbon intensity per capita] number can go down, even though the brown side of the equation hasn’t changed,” Anderson said. “That is why we see this disconnect between renewable generation and emissions.”

The study also raises important questions for American climate hawks. Renewable portfolio standards and net metering remain two of the most popular climate policies in the United States. Seven new Democratic governors will take office in 2019, many of whom campaigned on promises to increase renewable quotas in their states (Climatewire, Nov. 8).

Among the potential roadblocks they face for turning renewable portfolio standards into effective climate policy, according to the OECD: subsidies for fossil fuel companies; research and development for fossil fuels; and recently built fossil fuel power plants, which raise the risk that ratepayers or investors are stuck with stranded assets.