RPS Statutes: Does Favoritism Undercut Their Goals?

One of my law students completed a research paper showing that most state renewable portfolio statutes contain provisions favoring in-state sources to the disadvantage of out-of-state sources.  Some advocates of this approach—and of renewable energy—defend this discrimination on the grounds of necessity:  Bringing jobs and economic development to the state softens opposition to the price increases that will result.  Getting a bill passed is worth violating the U.S. Constitution.

The irony is that this favoritism ultimately hurts the renewable cause by raising consumer costs:  it limits the universe of available supply that could compete to satisfy a state's requirement.  And it invites other states to dish it back, like baseball pitchers beaning each other's batters.

Nor does the state-as-laboratories argument work.  When Justice Brandeis wrote that states were "laboratories of democracy," he was not inviting them to erect trade barriers or raise their neighbors' costs.  The Constitition is not something to invoke or ignore, depending on one’s temporary circumstances.  The very purpose of a Constitution is to have principles that override those circumstances.

A federal RPS (supplemented by states as they wish), would solve the problem, by taking the pressure off of state-level advocates who face the need to author discriminatory statutes to get the votes.

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