Study finds when utilities add renewables consumer costs drop

April 9, 2015

U.S. News & World Report recently shared an analy­sis that shows states with the high­est share of elec­tric­ity gen­er­a­tion from renew­able energy sources pay less for power. These find­ings con­firm what many believe: increas­ing renew­ables will bring down cus­tomers’ elec­tric­ity bills.

With the EPA set to issue final rules this sum­mer for its Clean Power Plan to cut power plant emis­sions, there has been greater scrutiny of the costs asso­ci­ated with increas­ing util­i­ties’ per­cent­age of renew­able power sources, like wind and solar. Along with that scrutiny have come oppos­ing claims about how these new reg­u­la­tions would affect cer­tain pop­u­la­tions, par­tic­u­larly low-​​income fam­i­lies and senior citizens.

To answer this ques­tion, DBL Investors com­pared the 10 states with the most and the 10 states with the least renewably-​​sourced energy against the national aver­age. What DBL Investors found was that states with the high­est per­cent­age of renew­ables actu­ally saw the small­est increase in their elec­tric­ity costs over a 10-​​year period. Mean­while, states with the least renew­able energy paid sig­nif­i­cantly more than aver­age. Notably, both Ten­nessee and South Car­olina are in the bot­tom 10 states.

This find­ing refutes the claim made by indus­try oppo­nents of the Clean Power Plan that requir­ing reduced emis­sions and increased renew­able energy sources will drive up elec­tric­ity costs, par­tic­u­larly for those least able to pay.

As clean energy takes off, it is crit­i­cal to under­stand how elec­tric­ity prices have fared,” wrote the report’s authors, Nancy Pfund and Anand Chhabra. “On aver­age, states that have led on renew­ables over the past ten years have had cheaper aver­age retail elec­tric­ity than both the national aver­age and states that lag ingener­a­tion from renewables.”

The full report from DBL Investors, a San Franscisco-​​based ven­ture cap­i­tal firm spe­cial­iz­ing in renew­able energy, is avail­able here.