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Renewable energy technology is now available, but is disadvantaged relative to existing fossil fuel-based alternatives. In part this is because the purchase price of renewable technology is higher than conventional sources in the marketplace. However, seldom does the purchase or operating cost of energy reflect the true societal costs of local air pollution, acid rain, climate change, land disturbance, water pollution and the repeated economic disruptions and job losses caused by energy price shocks. Renewable energy also provides greater economic and national security and reduces the need for military protection of distant supply sources. Despite a higher initial purchase price for renewable technology, the fuel cost of renewables is constant and zero (in most cases), providing insurance against future economic disruptions. A number of policy barriers within each of the three North American nations need to be addressed, and national and subnational laws and NAFTA trading rules need to be reconciled in order for renewable energy to achieve its full potential. While concerns have been raised that state-instituted renewable portfolio standards might conflict with NAFTA rules, proposals have appeared to resolve potential conflicts (CEC 2001; Horlick 2001; UCS 2002). It is also essential to adopt a long-term perspective for expanding the role of renewable energy in North America over the next several decades. An examination of successful renewable energy policies in North America and Europe suggests that some of the following policy goals and options might be effective in accelerating the adoption of renewable energy technologies. General Policy Principles to Promote Renewable Technology ß Establish a consistent and comprehensive system for monitoring renewable energy production and consumption in each country. ß Create a common and coordinated strategy for introducing renewables into North America, and identify ways in which the three nations might cooperate. ß Internalize the environmental, social and macro economic costs of energy into energy markets. ß Establish consistent, long-term policies and incentives for renewables so that investors will have greater certainty about rates of return on their investments. ß Align RPS and other domestic regulations and NAFTA trading rules to be consistent and supportive of renewable energy. Establish Incentives for Renewables ß Demand-pull incentives, such as assured prices or price increments, are generally more effective than supply-push technology development strategies. ß Encourage the purchase of renewable technology by providing tax credits for its installation and use, and by removing sales and property taxes for renewable technology or infrastructure. ß Establish renewable portfolio standards for electric power generation, fuels and buildings, with an increasing percentage of renewables required over time. Renewable Electricity ß Remove impediments for adding distributed sources generally to the grid, by making the transmission and distribution system open to all producers, regardless of size. 11PDF Image | Assessing Barriers and Opportunities for Renewable Energy in North America
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