Local governments increasingly use policy mechanisms to drive energy efficiency and renewable energy deployment in their communities. Recent activity of this sort of clean energy deployment, financed partly by the influx of Recovery Act funding, aims to further local economic development, energy security, and environmental goals. While there has been substantial research on federal and state clean energy policies in the past, research on the impact of local policies is absent. To fill this knowledge gap, the Department of Energy’s Office of Weatherization and Intergovernmental Programs (WIP) is funding research on local policy effectiveness.

Last month, the National Renewable Energy Laboratory (NREL) published research on the extent and impact of local clean energy policies. This report identifies the following trends in local clean energy policy:

• Local governments are uniquely positioned to drive clean energy adoption and can use policy to develop the local market. By decentralizing policy development, local governments can tailor policies to their communities’ needs.
• It’s important for local governments to understand the policy context within their state so that they can implement local policies that best fit their goals.
• Local governments in states that have supportive policy environments for clean energy development are more likely to adopt goals to help mitigate climate change.
• Based on the narrow scope of locally implemented policies that the Database of State Incentives for Renewables and Efficiency (DSIRE) tracks:

  • 60% of the financial incentives that local governments offer are either rebates or incentives for green building.

  • 55% of the policies DSIRE classifies as “rules, regulations, and policies” are for renewable power purchasing or energy standard requirements for public buildings.

The takeaway is that in order to better understand the impact of local clean energy policies, more comprehensive tracking of local actions will be necessary.

To supplement existing data, local officials were interviewed to gain insight on the direction policy implementation is currently taking in their communities. The main findings include:

• Clean energy options are typically framed as a way to reduce energy-related costs and to mitigate climate change.
• Cost is still the major barrier to clean energy adoption. To address this barrier, local governments are offering financial incentives funded partly through the Recovery Act, as well as tapping into additional state and federal funding assistance.
• There is substantial interaction between local governments on clean energy policy development. Local government interaction with state governments varies greatly, however, as few local governments frequently interact with their state government.

To find out more about state and local clean energy policy development, please visit NREL’s Clean Energy Policy Analyses project for resources, case studies, and other information targeted to help state and local officials determine which policies make the most sense for their community.

Content for this Blog post courtesy of Sarah Busche, National Renewable Energy Laboratory