Environmental Engineering Reference
In-Depth Information
At the state level, decisions regarding electricity system management tend
to rest with public utility commissions that make strategic decisions and set
retail prices subject to state legislature or state executive approval. Since the
electricity grid in most states is owned and managed by an array of public
(regional or municipal) and private utilities, much of the work of state regu-
latory bodies relates to standard setting and enforcement, the issuance of
plant permits, pricing regulation, and overall system coordination.
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he interplay between federal and state energy authorities is complex and
complicated. As an example, FERC plays a key role in governing wholesale
electricity prices but states or substate agencies are responsible for retail
electricity price setting. he commission also oversees the transport of
gas and oil across state borders and grants permission for the siting of liq-
uid natural gas (LNG) terminals, but the states are responsible for setting
retail gas rates and for licensing in-state power plants. Under this system
of divided authority, both federal and state governments share authority in
a form of interactive federalism. It has been estimated that the electricity
sector is regulated by 53 federal, state, and substate entities and subject to
more than 44,000 state or substate codes.
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Climate change mitigation policy also inluences what happens in the
electricity sector, and in a similar manner to energy policy, both federal
and state policies interact to weave together what eventually becomes
national climate change policy. At the federal level, the overarching climate
change mitigation target stems from the commitment made by the Obama
Administration in Copenhagen in 2009. As outlined earlier, as a party to
the Copenhagen Accord, the United States departed from its previous aver-
sion to concrete GHG emission reduction commitments by agreeing to work
toward reducing emissions by 17% of 2005 levels by 2020.
Prior to the US commitment in Copenhagen, a number of frustrated state
and substate policymakers stepped up, in the absence of a federal commit-
ment, to lead subnational initiatives to reduce GHG emissions. For example,
in 2006, the California legislature passed the Global Warming Solutions Act,
which aims to reduce GHG emissions to 1990 levels by 2020—a 25% reduc-
tion from 2006 levels.
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In some cases states have even banded together to
form regional coalitions. An example is the Regional GHG Initiative of 2003,
which developed a cap and trade program for GHG emissions from power
plants in states in the Northeastern United States and Eastern Canada.
Another example is the recent coalition of Western state governors that
is aiming to coordinate renewable energy targets across state boundaries.
here are even examples of substate leadership such as the US Conference
of Mayors Climate Protection Agreement which aims to comply with the
US commitment made during the Kyoto Protocol negotiations. As of May
