Your donation ensures voters everywhere have access to fair, accurate, and nonpartisan ballot information. Join theBallotpedia Society today!
Energy policy in the United States
This article does not receive scheduled updates. If you would like to help our coverage grow, considerdonating to Ballotpedia.Contact our team to suggest an update.
 |
Energy policy in the United States involves federal, state, and local governmental actions related to the production, distribution, and consumption of different sources of energy, includingfossil fuels such ascoal,oil, andnatural gas, as well asrenewable energy sources such assolar,wind,nuclear, andhydroelectric power.[1]
Energy policies are enacted and enforced at the local, state, and federal levels through legislation and regulation. Given the multiple policymakers at all levels of government in the United States, energy policy is complicated and interconnected. As a result, energy policy has several stakeholders, including citizens, elected state and federal officials, government agencies, national and state-level interest groups, corporations, and think tanks.[1]
Several factors can affect the feasibility of energy policies, such as the availability of energy resources, geography, the cost of extracting certain forms of energy, consumer demand, potential impacts to the environment, and more.
This article focuses on energy policy goals in the United States from the 1970s to the present, federal energy policy legislation in the United States, federal agencies and their role in shaping energy policy, and an overview of state-level energy policy.
Energy policy goals
Energy policy goals
According to theCongressional Research Service, the three main goals of energy policy in the United States since the 1970s have been "to assure a secure supply of energy, to keep energy costs low enough to meet the needs of a growing economy, and to protect the environment while producing and consuming that energy." In a September 2016 report, the Congressional Research Service outlined the following policy goals guiding U.S. energy policies since the 1970s.[2]
Conservation and energy efficiency: According to the Congressional Research Service, energy conservation and efficiency have been a policy goal since the 1970s when Arab members of theOrganization of the Petroleum Exporting Countries (OPEC), an intergovernmental organization, imposed a ban on petroleum exports to the United States and cut oil production, leading to rising U.S. gasoline prices. In response to the embargo's aftermath and higher domestic gas prices,Congress passed the1975 Energy Policy and Conservation Act, which directed the president to bancrude oil exports except for select types of oil and set average fuel efficiency standards for passenger vehicles beginning in model year 1978. As of May 2017, other energy efficiency measures implemented at the federal level included standards for home appliances, such as refrigerators, air conditioners, washing machines, and light bulbs.[3]
Domestic supply of fossil fuels: Beginning in the 1970s with the OPEC embargo and rising gasoline prices, policymakers debated the merits of greater domestic production offossil fuels, particularlyoil andnatural gas. Proponents of greater domestic production argue that increased production would result in more employment and labor income and a larger supply of energy, which would lower prices for consumers, and that oil and gas are more efficient and reliable forms of energy than renewable sources. Opponents of greater domestic production argue that oil and natural gas are finite resources and that their use produces more air and water pollution and thus should be discouraged in favor ofrenewable energy sources, such aswind andsolar energy.[2]
Oil and gasoline prices:Gasoline prices are affected by crude oil prices, which are in turn affected by multiple factors, including supply and demand, financial markets, international politics, environmental regulation, taxes, weather, and other factors. Oil production may increase or decrease depending on advances in technology, changes in industry regulation, policy changes, political forces, and more. Policymakers consider the role of these factors that determine gasoline prices and in general debate how best to keep gasoline prices affordable for consumers in light of other policy goals, such as conservation, environmental protection, and promotion of vehicles that use other fuels, such asethanol.[4][5][6][2][7]
Electricity generation: Policymakers debate the role of different types of energy, includingcoal,oil,natural gas,wind,solar, andnuclear power, in the U.S. electricity mix. In particular, policymakers debate the role of coal, which accounted for around 16 percent of total U.S. energy consumption in 2015—91 percent of which was used to generate electricity. Proponents of coal use argue that the relative abundance of coal compared to natural gas or oil produces more affordable electricity for consumers given high supplies of coal resources. These proponents cite theU.S. Energy Information Administration, which concluded in 2016 that the United States has the largest recoverable coal reserves worldwide. Opponents argue that the replacement of coal by natural gas,wind, andsolar energy in electricity generation produces benefits in the form of fewer air pollutants, less disruption to surface land needed to mine coal, and fewercarbon dioxide emissions linked to potentially human-causedclimate change.[8][9][10]
Use of renewable energy: Under theRenewable Fuel Standard passed byCongress in 2005, transportation fuels must contain a minimum amount ofbiofuel, such asethanol, which is fermented from corn and other crops. As of May 2017, other federal policies to promote renewable energy use included loan guarantees, tax credits, and federal grants to renewable energy sources. At the state level, 29 states as of March 2017 had an enforceableRenewable Portfolio Standard, a mandate to electric utilities to generate a minimum amount of electricity from eligiblerenewable energy sources, such as wind, solar,hydroelectric power,geothermal energy, and others. Proponents of policies encouraging greater renewable energy use argue thatfossil fuels are a finite resource and produce more air and water pollution than renewable sources, which are naturally replenished by sunlight, wind, and other resources. Opponents of policies encouraging greater renewable energy use argue that fossil fuels are more efficient at producing energy, more affordable for consumers, and that renewable sources require state and federal subsidies to be affordable, unlike coal, oil, or natural gas.[11][12][13][14]
Federal legislation
Federal legislation
Below are descriptions of federal energy policy legislation passed from 1970 to 2016.
Energy Policy and Conservation Act (1975): The act directed the president to bancrude oil exports except for select types of oil. The act also authorized the following:[15]
- Creation of the Strategic Petroleum Reserve, a federally managed emergency supply ofpetroleum in underground caverns along the Gulf of Mexico
- Corporate average fuel economy standards for passenger vehicles beginning in model year 1978
- Federal authority for the U.S. Department of Transportation to establish fuel economy standards for light- and heavy-duty trucks and other vehicles
- A schedule to end federal oil price controls
Natural Gas Policy Act (1978): The act authorized theFederal Energy Regulatory Commission (FERC) to regulate intrastate and interstatenatural gas production and transmission. In addition, the act set price ceilings for the first sale of gas from gas wells (the ceilings were later repealed).[16]
Alternative Motor Fuels Act (1988): The act established incentives for automobile manufacturers in the form of fuel economy credits for the production of motor vehicles that use alternative fuels, such asethanol andnatural gas.[17]
Energy Policy Act (1992): The act required theFederal Energy Regulatory Commission to allow wholesale electricity suppliers to access the national electricity transmission system on a case-by-case basis. The act also required federal and state fleets to acquire vehicles that operate on alternative fuels, such asethanol, natural gas, hydrogen, electricity, biodiesel, and more.[18]
Energy Policy Act (2005): The act authorized the following:[19]
- Energy-related tax incentives totaling roughly $14.5 billion from 2005 to 2016, including $1.3 billion in tax incentives for energy efficiency and conservation, approximately $4.5 billion in incentives for renewable energy, $2.6 billion in incentives for oil and gas production and transmission, almost $3.0 billion for coal production, and around $3.0 billion in incentives for electricity generation and transmission
- TheRenewable Fuel Standard, a program mandating that transportation fuels contain a minimum amount ofbiofuel, such asethanol
- Increasedoil andnatural gas production, more electric transmission lines, and more gas pipelines on federally owned land
Energy Independence and Security Act (2007): The act authorized the following:[19][20]
- Average fuel economy standard of 35 miles per gallon for all passenger vehicles and light trucks by the 2020 model year
- Energy efficiency standards for appliances, including external power supplies, residential clothes washers, dishwashers, dehumidifiers, refrigerators, freezers, and electric motors.
- Increasing the federalRenewable Fuel Standard to require transportation fuel to contain 36 billion gallons ofbiofuels likeethanol by the year 2022
American Recovery Reinvestment Act (2009): In the aftermath of the 2008 financial crisis, Congress passed theAmerican Recovery and Reinvestment Act (also known as the stimulus bill) in 2009. The bill authorized $35.2 billion in federal funding to theU.S. Department of Energy for the following policy measures:[21][22][23]
- Operational and energy measures to integraterenewable energy sources into the electric grid
- Energy efficiency incentives for building owners
- Support for the management and disposal of nuclear waste
Federal agencies
Federal agencies
Below are descriptions of federal agencies involved in energy policy (in alphabetical order).
- TheU.S. Department of Energy (DOE) was established in 1977. The department's stated mission is to "ensure America’s security and prosperity by addressing its energy, environmental and nuclear challenges through transformative science and technology solutions." As of May 2017, the department contained 27 offices, 21 national laboratories, four power marketing administrations, and 10 field sites. The department oversees the U.S. nuclear weapons program, the U.S. Navy nuclear energy program, and federal energy research.[24][25][26]
- TheU.S. Department of the Interior (DOI) was established in 1849. The department contains agencies such as theU.S. Bureau of Land Management, theU.S. Fish and Wildlife Service, and theU.S. National Park Service, which overseefederal land. The U.S. Bureau of Land Management has primary responsibility over permitting and regulating energy production on federal land, such ascoal,oil,natural gas,solar, andwind production.[27][28]
- TheU.S. Energy Information Administration (EIA) is responsible for collecting, analyzing, and distributing "impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment." It was established in 1977.[29][30]
- TheFederal Energy Regulatory Commission (FERC) is responsible for regulating the interstate transmission and wholesale sales ofelectricity and overseeinghydroelectric dams and utility mergers. In addition, the agency oversees the siting, permitting, and construction of interstatenatural gas pipelines.[16][31]
State energy policy
State energy policy
- Click here for Ballotpedia's coverage of energy policy in the 50 states
Energy policy at the state level includes legislation, regulation of energy extraction, taxes, incentives for energy production or use, energy efficiency standards, and more. Below are descriptions of energy policies adopted by state governments:
Oil and natural gas regulation: States withoil and/ornatural gas production adopt regulations to ensure environmental protection and worker safety. State-level regulations cover the drilling of all wells used for oil or gas exploration, the spacing of wells, permitting requirements for oil and gas operators,injection wells used to enhance oil and gas recovery or to dispose of wastewater, protection of groundwater and underground sources of drinking water, the cementing and plugging of wells, the underground storage of natural gas, the prevention of well blowout and leaks, well restoration, reporting requirements, and more. These regulations are generally issued and enforced by state-level energy departments or commissions.[32]
Renewable energy: As of May 2017, states implemented funding and financial incentive programs to subsidize or otherwise increase investment inrenewable energy resources such aswind,solar, andhydroelectric power. These programs includerenewable portfolio standards, grants, rebate programs, tax incentives, loans, performance-based incentives, and more. The aim of the policies generally involves reducing the cost of renewable energy production for consumers, reducing regulatory compliance costs, reducing investment risks involving renewable energy, and/or increasing the adoption of renewable energy sources by individuals and businesses.[33]
Energy efficiency: State-level energy efficiency standards can include voluntary or mandatory energy efficiency standards for new residential and commercial buildings built on or after a particular date. These standards generally include efficiency standards for heating, ventilating, air conditioning, water heating, and lighting in residential and/or commercial buildings.[34]
Utilities: States and localities generally have a role in regulating utilities, which are firms that own and/or operate facilities to generate, transmit, and/or distribute electricity, gas, and/or water to the public. For example, state and local regulators can oversee electricity transmission and distribution charges. Utilities are defined differently in each state and in federal legislation. Two general types of utilities are private and public utilities. Private utilities, commonly known as investor-owned utilities, provide stocks to investors and sell bonds. These utilities are regulated by state regulatory agencies. State agencies are also responsible for setting retail rates charged by investor-owned utilities, overseeing utility infrastructure, and ensuring that investor-owned utilities respond to customer service demands. Public utilities include government or municipally owned utilities regulated by local or municipal governments.[35][36]
Fuel taxes: Revenue collected by federal, state, and local governments from fuel taxes is usually used to fund transportation infrastructure such as roads and bridges. Some states may charge anexcise tax based on how much gas or diesel is purchased. Some states may charge retail tax based on the average price of gas over a certain period. Additionally, some states may charge an environmental tax to be used for environmental projects.[37][38]
Recent news
The link below is to the most recent stories in a Google news search for the termsEnergy policy United States. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.
See also
External links
- U.S. Department of Energy
- U.S. Environmental Protection Agency
- U.S. Energy Information Administration
- Official House Natural Resources Committee Page
- Official House Energy and Commerce Committee Page
- Official Senate Energy Committee Page
Footnotes
- ↑1.01.1Webber Energy Group, "Energy Policy in the United States," accessed April 1, 2017
- ↑2.02.12.2Congressional Research Service, "Energy Policy: 114th Congress Issues," September 2016
- ↑Congressional Research Service, "Energy Policy: Historical Overview, Conceptual Framework, and Continuing Issues," December 21, 2004
- ↑U.S. Energy Information Administration, "What Drives Crude Oil Prices, Overview," accessed April 17, 2016
- ↑The Federal Reserve Bank of St. Louis, "Behind the Signs: Factors That Affect Gasoline Prices," accessed April 27, 2016
- ↑Resources for the Future, "Does Speculation Drive Oil Prices?" November 26, 2012
- ↑The Economist, "Why the oil price is falling," December 8, 2014
- ↑U.S. Energy Information Administration, "International Energy Outlook 2016," May 2016
- ↑Forbes, "Trump's Sisyphean Coal Revival Requires A Battle With The Free Market," March 8, 2017
- ↑American Coalition for Clean Coal Electricity, "Coal Facts," May 15, 2017
- ↑Heritage Foundation, "Eliminate favorable treatment of biofuels," July 25, 2016
- ↑American Enterprise Institute, "US biofuels policy, global food prices, and international trade obligations," May 2015
- ↑Natural Resources Defense Council, "Advance cleaner fuels," accessed March 7, 2017
- ↑Advanced Biofuels Association, "Advocacy," accessed March 7, 2017
- ↑Cite error: Invalid
<ref>tag; no text was provided for refs namedCRS 2004 - ↑16.016.1U.S. Energy Information Administration, "Natural Gas Policy Act of 1978," accessed August 21, 2014Cite error: Invalid
<ref>tag; name "about" defined multiple times with different content - ↑U.S. Department of Energy, "Alternative Motor Fuels Act of 1988," accessed May 1, 2017
- ↑U.S. Department of Energy, "Key Federal Legislation," accessed May 1, 2017
- ↑19.019.1Congressional Research Service, "Energy Policy Act of 2005: Summary and Analysis of Enacted Provisions," March 8, 2006Cite error: Invalid
<ref>tag; name "crsreport" defined multiple times with different content - ↑U.S. Environmental Protection Agency, "Summary of the Energy Independence and Security Act," accessed August 25, 2014
- ↑U.S. Department of Energy, "Recovery Act," accessed June 12, 2014
- ↑U.S. Department of Energy, "Department of Energy: Successes of the Recovery Act," January 2012
- ↑U.S. Government Printing Office, "American Recovery and Reinvestment Act of 2009," January 6, 2009
- ↑U.S. Department of Energy, "Mission," accessed October 4, 2014
- ↑U.S. Department of Energy, "A Brief History of the Department of Energy," accessed June 12, 2014
- ↑U.S. Department of Energy, "Offices," accessed June 12, 2014
- ↑U.S. Department of the Interior, "Strategic plan FY 2011-2016," accessed January 2, 2013
- ↑U.S. Department of Energy, "Interior Organizational Chart," accessed June 12, 2014
- ↑U.S. Energy Information Administration, "Mission and Overview," accessed June 12, 2014
- ↑U.S. Energy Information Administration, "EIA Offices," accessed June 12, 2014
- ↑Federal Energy Regulatory Commission, "An Overview of the Federal Energy Regulatory Commission and Federal Regulation of Public Utilities in the United States," December 2010
- ↑Railroad Commission of Texas, "Oil and Gas," accessed February 28, 2017
- ↑U.S. Environmental Protection Agency, "Chapter 3. Funding and Financial Incentive Policies," accessed March 1, 2017
- ↑DSIRE, "Building Energy Code," accessed March 7, 2017
- ↑Business Dictionary, "Electric utility," accessed February 28, 2017
- ↑U.S. Department of Energy, "A Primer on Electric Utilities, Deregulation, and Restructuring of U.S. Energy Markets," May 2002
- ↑U.S. Energy Information Administration, "Gasoline and Diesel Fuel Update," accessed April 25, 2016
- ↑Tax Foundation, "How High Are Gas Taxes in Your State?" July 23, 2016
| |||||||||||
