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The U.S. Energy Industry Is Charging Toward Big Carbon Reductions No Matter What the Supreme Court Does

Although the Clean Power Plan is caught up in legal limbo, states and utilities are moving ahead with the transition to clean energy.
February 24, 2016

When the Supreme Court unexpectedly placed the EPA’s Clean Power Plan on hold earlier this month, it was seen as a sharp blow to the Obama administration’s efforts to hasten the transition away from fossil fuels to cleaner forms of energy. As it turns out, that may not be the case, as utility executives grapple with huge market forces that are transforming the energy sector, whether the Clean Power Plan is eventually upheld or not.

That’s the conclusion of an informal survey of big utilities by SNL Energy, which found that “planning for a lower carbon future will continue regardless of the Supreme Court's recent stay of the rule.”

Duke Energy CEO Lynn Good seemed to corroborate the survey’s findings during the company’s earnings call on February 18, when she said, “I think for the near term, the strategy will be to watch the litigation, and then execute the plan that we already have in front of us in terms of modernizing our system."

State governments are also moving ahead. The New York Department of Public Service last week released its plan to meet Governor Andrew Cuomo’s goal of obtaining 50 percent of the state’s power by 2030. Hawaii, with the highest energy prices in the country, is the first state to set a goal of 100 percent renewable energy, aiming to eliminate fossil fuels by 2045—although recent moves by Hawaiian Electric, the state’s major utility, call that target into doubt.

California governor Jerry Brown approved a landmark bill in October that will increase the state’s renewable target to 50 percent, in addition to increasing energy efficiency by half by 2030. Among the other states moving aggressively toward deriving half or more of their power from renewable sources are Vermont (75 percent by 2032) and Oregon (50 percent by 2040).

A more powerful driver than the stick of EPA regulations is the carrot of tax incentives: the National Renewable Energy Laboratory released a study on Monday showing that the extension of federal tax credits for rooftop solar, announced in December, will add between 48 and 53 gigawatts of installed renewable generation capacity by 2025. Even more dramatic will be the effect on greenhouse-gas emissions: between 540 million and 1.4 billion metric tons of carbon dioxide will be eliminated between now and 2030 thanks to the tax credit extension, the NREL report found.

(Read more: "Supreme Court Strikes Blow Against Obama's Climate Agenda")

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