Effect of Natural Gas Prices on Renewable Portfolio Standard Impacts


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Authors

  • Christopher Hannum University of Central Asia, Tajikistan.

DOI:

https://doi.org/10.32479/ijeep.13741

Keywords:

Electricity, Natural Gas, Energy Policy, Renewable Portfolio Standard, Computable General Equilibrium

Abstract

Climate policy in the United States is often carried out at the state level rather than the national level, including renewable portfolio standards for the electricity generation sector. We assess the impacts of the RPS in the State of Colorado, one of the first to be implemented, using a recursive dynamic CGE model CO-E. The RPS reduces real household income in the state by an annualized value of $134.8 million in 2025 if natural gas prices are low, but results in increased incomes with medium or high natural gas prices although with medium natural gas prices the RPS causes electricity prices to rise. The impacts of the RPS are negatively correlated with those of natural gas price shocks to the overall state economy.  As a result, the RPS serves as a partial insurance policy for the State against natural gas price shocks, which adds $4.53 million to the annualized benefit of the policy.

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Published

2023-03-24

How to Cite

Hannum, C. (2023). Effect of Natural Gas Prices on Renewable Portfolio Standard Impacts. International Journal of Energy Economics and Policy, 13(2), 391–403. https://doi.org/10.32479/ijeep.13741

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Section

Articles