Renewable Regulations

Renewable Regulations

To assist those who are involved with renewable energy and energy efficiency projects, listed below are a number of resources related to the development and deployment of renewable energy and energy efficiency projects.
 
[spoiler title="Bond Programs" style="2"]
Bonds allow governments (and corporations) to raise money by borrowing. A few states and local governments have established bond programs to support energy efficiency and renewable energy for government-owned facilities. After a government has raised an authorized sum of money through the sale of bonds, the money collected is used to improve energy efficiency or to install renewable energy systems on government facilities. The bonding authority is usually reimbursed using the energy savings resulting from these projects.[/spoiler]

[spoiler title="Corporate Tax Incentives" style="2"]
Corporate tax incentives include corporate tax credits, deductions and exemptions. These incentives are available in some states to corporations that purchase and install eligible renewable energy or energy efficiency equipment, or to construct green buildings. In a few cases, the incentive is based on the amount of energy produced by an eligible facility. Some states allow the tax credit only if a corporation has invested a minimum amount in an eligible project. Typically, there is a maximum limit on the dollar amount of the credit or deduction. In recent years, the federal government has offered corporate tax incentives for renewables and energy efficiency. (Note that corporate tax incentives designed to recruit or cultivate manufacturing and the development of renewable energy systems or equipment, or energy efficiency equipment, are categorized as “Industry Recruitment/Support” in DSIRE.)[/spoiler]

[spoiler title="Grant Programs" style="2"]
States offer a variety of grant programs to encourage the use and development of renewable energy technologies and energy efficiency measures. Most programs offer support for a broad range of technologies, while a few programs focus on promoting one particular technology, such as photovoltaic (PV) systems. Grants are available primarily to the commercial, industrial, utility, education and government sectors. Most grant programs are designed to pay down the cost of eligible systems or equipment. Others focus on research and development, or support project commercialization. In recent years, the federal government has offered grants for renewables and energy efficiency projects for end-users. Grants are typically available on a competitive basis.[/spoiler]

[spoiler title="Green Building Incentives" style="2"]
Green buildings are designed and constructed using practices and materials that minimize the impacts of the building on the environment and on human health. Many cities and counties offer financial incentives to promote green building. The most common form of incentive is a reduction or waiver of a building permit fee. The U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) is a popular point-based certification program for green buildings. The LEED system awards points for site selection and development; material, energy and water efficiency; indoor air quality; innovation; and the application of renewable technologies. (Note that this category includes green building incentives that do not fall under other DSIRE incentive categories, such as tax incentives and grant programs.)[/spoiler]

[spoiler title="Industry Recruitment/Support" style="2"]
To promote economic development and the creation of jobs, some states offer financial incentives to recruit or cultivate the manufacturing and development of renewable energy systems and equipment. These incentives commonly take the form of tax credits, tax exemptions and grants. In some cases, the amount of the incentive depends on the amount of eligible equipment that a company manufactures. Most of these incentives apply to several renewable energy technologies, but a few states target specific technologies, such as wind or solar. These incentives are usually designed as temporary measures to support industries in their early years, and they commonly include a sunset provision to encourage the industries to become self-sufficient.[/spoiler]

[spoiler title="Leasing/Lease Purchase Programs" style="2"]
A few electric utilities offer leasing programs for prospective customers in remote areas, especially if the cost of extending electric distribution lines to the customer’s home or facility would be expensive. Through these programs, customers may lease from the utility a system that generates electricity, such as a photovoltaic (PV) system. In some cases, the customer may choose to purchase the system after a specified period of time. In such cases, the customer may choose to purchase the system after a specified period of time.[/spoiler]

[spoiler title="Loan Programs" style="2"]
Loan programs provide financing for the purchase of renewable energy or energy efficiency systems or equipment. Low-interest or zero-interest loans for energy efficiency projects are a common demand-side management (DSM) strategy for electric utilities. State governments also offer low-interest loans for a broad range of renewable energy and energy efficiency measures. These programs are commonly available to the residential, commercial, industrial, transportation, public and nonprofit sectors. Loan rates and terms vary by program; in some cases, they are determined on an individual project basis. Loan terms are generally 10 years or less. In recent years, the federal government has offered loans for renewables and energy efficiency projects.[/spoiler]

[spoiler title="Personal Tax Incentives" style="2"]
Personal tax incentives include personal income tax credits and deductions. Many states offer these incentives to reduce the expense of purchasing and installing renewable energy or energy efficiency systems and equipment. The percentage of the credit or deduction varies by state, and in most cases, there is a maximum limit on the dollar amount of the credit or deduction. A credit may include carryover provisions, or it may be structured so that the credit is spread out over a certain number of years. Eligible technologies vary widely by state. In recent years, the federal government has offered personal tax incentives for renewables and energy efficiency.[/spoiler]

[spoiler title="Production Incentives" style="2"]
Production incentives provide cash payments based on the number of kilowatt-hours (kWh) a renewable energy system generates. To ensure project quality, payments based on a system’s actual performance are generally more effective than payments based on a system’s rated capacity. Production incentives are also known as performance-based incentives. (Note that tax incentives based on the amount of energy produced by an eligible facility are categorized as “Corporate Tax Incentives.”)[/spoiler]

[spoiler title="Property Tax Incentives" style="2"]
Property tax incentives include exemptions, exclusions and credits. The majority of property tax incentives provide that the added value of a renewable energy system is excluded from the valuation of the property for taxation purposes. For example, if a heating system that uses renewable energy costs more to install than a conventional heating system, the additional cost of the renewable energy system is not included in the property assessment. In a few cases, property tax incentives apply to the additional cost of a green building. Because property taxes are collected locally, some states grant local taxing authorities the option of allowing a property tax incentive for renewable energy systems.[/spoiler]

[spoiler title="Rebate Programs" style="2"]
States, local governments and utilities offer rebates to promote the installation of renewable energy systems and energy efficiency measures. The majority of rebate programs that support renewable energy are administered by states, municipal utilities and electric cooperatives; these programs commonly provide funding for solar water heating and/or photovoltaic (PV) systems. Most rebate programs that support energy efficiency are administered by utilities. Rebate amounts vary widely based on technology and program administrator.[/spoiler]

[spoiler title="Sales Tax Incentives" style="2"]
Sales tax incentives typically provide an exemption from the state sales tax (or sales and use tax) for the purchase of a renewable energy system, an energy-efficient appliance, or other energy efficiency measures. Several states have established an annual “sales tax holiday” for energy efficiency measures by allowing a temporary exemption – usually for one or two days – from the state sales tax.[/spoiler]

[spoiler title="Utility Rate Discounts" style="2"]
A few electric utilities offer rate discounts to encourage residential energy efficiency. For homes that meet certain energy efficiency criteria, such as those established by the federal Energy Star program, the owner or tenant is awarded a percentage discount on each month’s electric bill.[/spoiler]

[spoiler title="Appliance/Equipment Efficiency Standards" style="2"]
Many states have established minimum efficiency standards for appliances and equipment. In these states, the retail sale of appliances and equipment that do not meet these standards is prohibited. The federal government has also established efficiency standards for appliances and certain equipment. When both the federal government and a state have adopted efficiency standards for the same type of appliance or equipment, the stricter standard applies.[/spoiler]

[spoiler title="Building Energy Codes" style="2"]
Building energy codes adopted by states (and some local governments) require commercial and/or residential construction to adhere to certain energy standards. While some governmental bodies have developed their own building energy codes, many use existing codes, such as the International Energy Conservation Code (IECC), developed and published by the International Code Council (ICC); or ASHRAE 90.1, developed by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE). A few local building energy codes require certain commercial facilities to meet green building standards.[/spoiler]

[spoiler title="Contractor Licensing" style="2"]
Some states have adopted a licensing process for renewable energy contractors. Several states have adopted contractor licensing requirements for solar water heating, active and passive solar space heating, solar industrial process heat, solar-thermal electricity, and photovoltaics (PV). These requirements are designed to ensure that contractors have the necessary experience and knowledge to install systems properly.[/spoiler]

[spoiler title="Energy Standards for Public Buildings" style="2"]
Many states and local governments, as well as the federal government, have chosen to lead by example by requiring new government buildings to meet strict energy standards. DSIRE includes policies that have established green building standards, energy-reduction goals, equipment procurement requirements, and/or life-cycle cost analyses for publicly-owned buildings. Many of these policies require that new government buildings (and renovated buildings, in some cases) attain a certain level of certification under the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) program. Equipment-procurement policies often mandate the use of the most efficient equipment, such as equipment that meets the federal Energy Star standard, for new buildings. Life-cycle cost analysis policies generally require government entities to consider energy costs (including equipment and construction) over a planned new building’s entire life-cycle.[/spoiler]

[spoiler title="Equipment Certification Requirements" style="2"]
Policies requiring renewable energy equipment to meet certain standards serve to protect consumers from buying inferior equipment. These requirements not only benefit consumers; they also protect the renewable energy industry by making it more difficult for substandard systems to reach the market.[/spoiler]

[spoiler title="Generation Disclosure Rules" style="2"]
Some states require electric utilities to provide their customers with specific information about the electricity that the utility supplies. This information, which must be shared with customers periodically, usually includes the utility’s fuel mix percentages and emissions statistics. In states with restructured electricity markets, generation disclosure policies are designed to help consumers make informed decisions about the electricity and suppliers they choose. A few states that have not fully restructured their electricity markets require generation disclosure by utilities.[/spoiler]

[spoiler title="Green Power Purchasing/Aggregation Policies" style="2"]
Governments at all levels, businesses, residents, schools, nonprofit organizations and other entities can play a significant role in supporting renewable energy by buying electricity from renewable resources, or by buying renewable energy credits (RECs). Many state and local governments, as well as the federal government, have committed to buying green power to account for a certain percentage of their electricity consumption. A few states allow local governments to aggregate the electricity loads of an entire community to purchase green power and, potentially, to join with other communities to form an even larger purchaser of green power – a concept known as “community choice.” Green power purchases are typically executed by contracts with green power marketers or project developers, with utility green power programs, or through community aggregation.[/spoiler]

[spoiler title="Interconnection Standards" style="2"]
Interconnection standards govern the technical and procedural process by which an electric customer connects an electric-generating system to the grid. Interconnection standards specify the technical, contractual, metering, and rate rules that system owners and utilities must abide by. Standards for systems interconnected at the distribution level are typically adopted by state public utility commissions, while the Federal Energy Regulatory Commission (FERC) has adopted standards for systems interconnected at the transmission level. Not all states have adopted interconnection standards, and some states’ standards apply only to investor-owned utilities – not to municipal utilities and electric cooperatives.[/spoiler]

[spoiler title="Line Extension Analysis" style="2"]
When a prospective electric customer requests service for a home or facility that is not currently serviced by the electric grid, the customer usually must pay a distance-based fee for the cost of extending power lines to the home or facility. In many cases, it is cheaper to use an on-site renewable energy system to meet a prospective customer’s electricity needs. Certain states require utilities to provide information regarding renewable energy options when prospective customers request a line extension.[/spoiler]

[spoiler title="Mandatory Utility Green Power Option" style="2"]
Several states require certain electric utilities to offer customers the option of buying electricity generated from renewable resources, commonly known as “green power.” Typically, utilities offer green power generated using renewable resources that the utilities own (or for which they contract), or they buy renewable energy credits (RECs) from a renewable energy provider certified by a state public utilities commission.[/spoiler]

[spoiler title="Net Metering" style="2"]
For electric customers who generate their own electricity, net metering allows for the flow of electricity both to and from the customer – typically through a single, bi-directional meter. With net metering, during times when a customer’s generation exceeds the customer’s use, electricity from the customer flows back to the grid, offsetting electricity consumed by the customer at a different time. In effect, the customer uses excess generation to offset electricity that the customer otherwise would have to purchase at the utility’s full retail rate. Net metering is required by law in most U.S. states, but some of these laws only apply to investor-owned utilities – not to municipal utilities or electric cooperatives.[/spoiler]

[spoiler title="Public Benefit Funds" style="2"]
Public benefit funds (PBF) are state-level programs typically developed during electric utility restructuring by some states in the late 1990s to ensure continued support for renewable energy resources, energy efficiency initiatives and low-income energy programs. These funds are most commonly supported through a very small surcharge on electricity consumption (e.g., $0.002/kWh). This charge is sometimes referred to as a system benefits charge (SBC). PBFs commonly support rebate programs for renewable energy systems, loan programs, research and development, and energy education programs.[/spoiler]

[spoiler title="Renewables Portfolio Standards/Set Asides" style="2"]
Renewable portfolio standards (RPS) require utilities to use renewable energy or renewable energy credits (RECs) to account for a certain percentage of their retail electricity sales – or a certain amount of generating capacity – within a specified timeframe. (Renewable portfolio goals are similar to RPS policies, but renewable portfolio goals are not legally binding.) The term “set-aside” or “carve-out” refers to a provision within an RPS that requires utilities to use a specific renewable resource (usually solar energy) to account for a certain percentage of their retail electricity sales (or a certain amount of generating capacity) within a specified timeframe. More than half of all U.S. states have established an RPS.[/spoiler]

[spoiler title="Solar and Wind Access Laws" style="2"]
Solar and wind access laws, which may be implemented at both the state and local levels, are designed to protect a consumer’s right to install and operate a solar or wind energy system at a home or business. Some solar access laws also ensure a system owner’s access to sunlight. In some states, access rights prohibit homeowners associations, neighborhood covenants or local ordinances from restricting a homeowner’s right to use solar energy. Easements, the most common form of solar access law, allow for the rights to existing access to a renewable resource on the part of one property owner to be secured from an owner whose property could be developed in such a way as to restrict that resource. An easement is usually transferred with the property title. At the local level, communities use several policies to protect solar access, including solar access ordinances, development guidelines requiring proper street orientation, zoning ordinances that contain building height restrictions, and solar permits.[/spoiler]

[spoiler title="Solar and Wind Permitting Standards" style="2"]
Permitting standards can facilitate the installation of wind and solar energy systems by specifying the conditions and fees involved in project development. Some local governments have adopted simplified or expedited permitting standards for wind and/or solar. “Top-of-the-stack” or fast-track permitting saves system owners and project developers time and money. Some states have established maximum fees that local governments may charge for a permit for a solar or wind energy system. In addition, some states have developed (or have supported the development of) model wind ordinances for use by local governments.[/spoiler]