Technologies and Key Policy Trends

Technology Overview

Recent growth in the use of clean energy is fundamentally reshaping the U. S. electricity system. Some of the most pronounced changes involve the increased use of utility- scale renewables, which now account for over 75 percent of all renewables.1 Generation from utility-scale wind and solar generation are now less expensive than coal fired generation in many parts of the nation.2 Solar costs have dropped by more than 70 percent over the last decade with utility-scale prices ranging from 2.8 to 4.5 cents per kwh.3 Similarly, the cost of on-shore utility-scale wind generation has fallen 69 percent since 2009, and 7 percent in 2018 alone, with utility-scale prices below 2 cents per kwh in some regions.4 Even without soon-to-expire federal tax credits, renewable energy costs are lower than the marginal cost of conventional energy technologies under a variety of future scenarios.5 Meanwhile, nuclear power remained steady at 19 percent of the U.S. generation mix in 2018. Commercial scale use of carbon capture and storage (CCS) technology is still limited for power plants, with the Petra Nova plant being the only one in U.S operation, but technology development efforts continue alongside efforts to expand the carbon dioxide pipeline system.6

Technological innovations are occurring on the customer side of the meter as well. These “behind the meter” distributed energy resources include residential and commercial solar power, battery storage, fuel cells, electric vehicle charging, combined heat and power systems, microgrids, demand response technologies, and other energy management strategies. Electric vehicle charging and the opportunity for automotive batteries to serve as distributed storage is also a part of this transformation.


Renewable energy (both utility scale and distributed) has emerged as an engine of economic growth. The solar industry employs 242,000 Americans, more than double the number in 2012, investing $17 billion in the U.S. in 2018.7 Similarly, the wind industry employees 114,000 Americans, with over 500 factories in 42 states.8 Five classes of distributed energy resources — distributed solar, small-scale combined heat and power, residential smart thermostats, electric vehicles and battery energy storage — contributed 46.4 GWs of impact on the U.S. summer peak in 2017, a figure that’s expected to exceed 100 GWs by 2023.9 The nuclear industry encompasses some 72,000 jobs in the U.S., across the utility, professional services and manufacturing sectors.10

Key Policy Trends

  • States’ renewable energy ambitions soar

  • Governors leading efforts to address climate change

  • Natural gas and renewables booming, coal generation continues to drop

  • Incentives to continue nuclear generation expanding

  • Embrace of renewables by corporations and electric utilities growing

Opportunities, Challenges
 and State Solutions


The electricity system pioneered by Thomas Edison over 125 years ago is undergoing a fundamental transformation. Driven by technological innovations, growing consumer engagement, and heightened environmental awareness, the U.S. electricity system is evolving into a dynamic network with a decline in traditional generation sources and a rise in a more diverse array of utility-scale renewables and distributed energy resources.

Among the benefits attributed to utility-scale renewable technologies and distributed energy resources are energy cost savings, deferred infrastructure upgrades, enhanced system resilience and reliability, power quality benefits, and improved environmental performance.1 Some states are also looking to continue the use of nuclear power as a reliable, emissions-free resource and interested in the opportunities for carbon capture and storage for coal generation.


Wind and solar technologies are variable resources since the wind does not always blow and the sun does not always shine. Integrating these variable resources onto the grid requires significant planning and the use of controllable generation, such as natural gas, hydropower and battery storage, that can ramp up or down quickly as supply and demand fluctuate.

Similar care must be taken to effectively integrate distributed energy resources onto the grid. Among the unique challenges posed by distributed energy resources are the need for more robust distribution system planning, privacy concerns related to third-party access to consumer energy data through mobile energy-conservation applications and cyber-security concerns.2

Existing nuclear generation faces economic challenges while the technologies associated with carbon capture and storage or utilization are cost prohibitive and call for additional infrastructure developments to achieve scale.

State Solutions

As discussed below, states have developed a wide array of policies to promote utility-scale renewables and distributed energy resources. Some are also developing incentives to support continued operation of nuclear plants. State solutions include:

  • Establishing and/or Strengthening Renewable Portfolio Standards (RPS)

  • Encouraging Distributed Solar Generation

  • Encouraging Community Solar

  • Accelerating Adoption of Battery Storage Technologies

  • Promoting Off-Shore Wind Resources

  • Addressing Transmission Constraints and Siting Requirements for Land-Based Wind Farms

  • Expanding Clean Energy Funding and Financing

  • Adopting Greenhouse Gas Reduction Targets

  • Expanding Corporate Access to Renewables

  • Revisiting Hydropower

  • Supporting Continued Nuclear Generation

State Solutions Spotlights

The U.S. electricity system is experiencing a fundamental transformation as a result of the rapid maturation of clean energy resources like wind and solar, advanced battery storage and other distributed energy technologies. These technologies are increasingly cost-competitive, are less susceptible to fuel price fluctuations, offer customers greater control of their energy choices, and typically involve lower or no emissions, including greenhouse gases, than most traditional sources.

Establishing and/or Strengthening Renewable Portfolio Standards (RPS)

Twenty-nine states, D.C. and three territories have adopted Renewable Portfolio Standards (RPS), which require that a specified percentage of the electricity provided by utilities come from renewable or clean energy resources.1 In some states, these resources may include zero carbon technologies such as carbon capture and storage, or nuclear energy. An additional eight states and one territory have set voluntary clean energy goals. First adopted by Iowa in 1983 under a voluntary approach, these requirements have proven effective in diversifying a state’s electricity generation mix, encouraging domestic energy production and stimulating local job creation.

While most state targets are between 10 and 45 percent, twelve states and territories —California, Hawaii, Massachusetts, Maryland, Nevada, New Mexico, New Jersey, New York, Oregon, Puerto Rico, Vermont, and Washington state have requirements of 50 percent or greater.2 Five of these states and territories – California, Hawaii, Puerto Rico, Nevada, and New Mexico have set 100 percent clean energy goals.3

  • California

  • New Mexico

  • New York

Adopting Greenhouse Gas Reduction Targets

Over the past decade, twenty-nine have adopted specific greenhouse gas reduction targets to address climate change.9 More recently, over the past year, a bipartisan group of twenty-five Governors have pledged that their state will reduce carbon emissions by at least 45 percent below 2005 levels by 2030.10 Together, states making this non-binding commitment make up 55 percent of the U.S. population.11

  • Maryland

  • New Mexico

Expanding Clean Energy Funding and Financing

To stimulate private investment in clean energy projects (both renewables and energy efficiency), numerous states have launched innovative efforts to leverage public funds with private capital. Popular efforts include Property Assessed Clean Energy (PACE) programs and green banks.

  • Connecticut

  • Missouri

  • New York

Encouraging Community Solar

Community solar has emerged as an affordable way for renters, homeowners and businesses to enjoy the benefits of solar power regardless of whether their building is conducive to hosting a solar array. Community solar typically refers to a solar facility shared by multiple community subscribers who receive credit on their electric bills for their share of the power produced.23 Nineteen states have enacted policies and programs to promote community solar, with 43 states having at least one community solar project on-line.24

  • Colorado

  • New Jersey

Accelerating Adoption of Storage Technologies

The need for continuous, real-time balancing of electricity supply with demand has defined the nature of the electricity grid to date. The emergence of cost-effective electricity storage is transforming the grid, helping to avoid excess grid infrastructure, integrating variable wind and solar resources, and enhancing grid reliability and resiliency.

The global energy storage market is growing exponentially.27 In the U.S., energy storage revenue has grown from $58 million to $701 million over the last five years with technologies including flywheels, thermal energy storage, and advanced battery technologies.28

State policies that have proven successful in accelerating the adoption of storage technologies include establishing state storage targets, integrating storage into existing programs (such as RPS or clean peak standards), and incorporating storage into utility integrated resource planning and similar exercises.

  • Arizona

  • California

Promoting Off-Shore Wind Resources

U.S. offshore wind has a technical resource potential of over 2,000 GWs,33 which is one-sixth of the total existing capacity.34 The combination of steady wind, absence of buildings or mountains, and relative proximity to the nation’s largest cities, has made offshore wind an increasingly competitive clean energy resource. Rhode Island completed the nation’s first offshore wind project in 2016. Today, there are 15 active projects off the east coast, with more under consideration in California, Hawaii, New York and South Carolina.35

  • Maryland

  • Massachusetts

Addressing Transmission Constraints and Siting Requirements For Land-Based Wind

Utility scale wind energy was the number one source of new U.S. electricity generation in 2018, and is expected to keep the top spot with 10.9 GWs of new capacity scheduled to come online in 2019.39 With 2018 industry growth at 8 percent, U.S. wind power supports 114,000 American jobs, over 500 domestic factories, and more than $1 billion a year in revenue for states and communities that host wind farms.40 Three states – Texas, Iowa, and Illinois – will host more than half the planned wind additions.41

Many of the nation’s best land-based wind resources are located in the nation’s midwest and southwest, often far from large population centers.42 Major new transmission lines are therefore needed if the nation is to harness this resource. Such projects typically cross multiple states and federal lands, which makes the process of obtaining the environmental permits, right of ways, easements and licenses particularly challenging. The Transwest Express from Wyoming to Nevada recently received its final permit approval from Wyoming, clearing the way for construction to begin as early as 2020 and to be in operation by 2023.43 Other major transmission proposals currently under consideration include the SSO Green Renewable Rail from Iowa to Illinois and the Grain Belt Express from Kansas to Indiana. Expediting the often decade-long transmission permitting process can significantly accelerate land-based wind development.44

Many states are also grappling with siting concerns from nearby residents prompted by this rapid growth. Some states have designated siting authority to state agencies, while most “home rule” states rely on local governments to manage siting.45 Nine states, Maine, Massachusetts, Michigan, New York, Oregon, Pennsylvania, South Dakota, Utah and Wisconsin, have adopted a model state wind siting ordinance, such as requiring property line setbacks of 110-120 percent of the turbine’s height, to help local officials ensure safety without hindering the industry’s continued growth.46

Encouraging Distributed Solar Generation

With the cost of installing solar dropping 70 percent over the last decade, the solar industry continues its rapid growth.47 Today, the U.S. solar industry includes over 242,000 employees involved in the manufacture and installation of solar power, ranging from small rooftop systems to large utility-scale solar arrays.48

To encourage adoption of distributed solar generation, 38 states. and 4 territories offer “net metering,” which allows residential and commercial customers to sell excess solar power back to the grid.49 In recent years, many states have considered updating their net metering policies to avoid shifting the costs of maintaining the electricity grid to non-solar and other customers with distributed generation systems.50 Some states have adopted alternative “value of solar” rates to compensate solar based on the variety of costs and benefits provided rather than paying a fixed retail rate.51

Expanding Corporate Access to Renewables

Over 70 of the Fortune 100 corporations and almost 50 percent of Fortune 500 companies have set either clean energy or sustainability targets.52 Yet these businesses have discovered a range of barriers that often prevent them from purchasing the type of electricity that they want. Common obstacles include prohibitions on the use of power purchase agreements, size restrictions on solar arrays, overly restrictive wind setback requirements, and, more fundamentally, a regulatory structure that requires the company to obtain its electricity from the local regulated monopoly.

To attract new business and economic development, governors are working with corporate leaders and utilities to develop creative solutions to hurdle these barriers. For example, in Kentucky, several utilities have proposed a “green tariff” to promote local clean energy projects and economic development.53

Revisiting Hydropower

Hydropower remains the nation’s largest generator of clean energy with 101 GWs currently operational.54 As the nation incorporates more variable resources to the grid, emission-free hydropower can provide flexibility, given its ability to ramp up quickly and provide black start power when the grid is down.

Relicensing is a critical issue for the 325 hydropower plants whose licenses expire by 2032.55 Although relicensing is a federal process, states should remain aware of the timeline for in-state assets. States interested in expanding hydropower can consider upgrades at existing projects, developing non-powered existing dams, new pumped storage projects and conduit hydro projects. To support existing hydropower, states could also consider including hydropower in their Renewable Portfolio Standards.

Download The Full Toolkit

NGA’s State Energy Toolkit offers ideas to help governors respond to trends as they take action in their states.

  • Overviews of Technologies & Policy Trends

    Understand the landscape and see what’s on the horizon.

  • Opportunities, Challenges & State Solutions

    Meet state goals for advancing clean energy.

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