Clean Energy Equity

47 Pages Posted: 4 Dec 2018 Last revised: 5 Dec 2018

See all articles by Felix Mormann

Felix Mormann

Texas A&M University School of Law; Stanford Law School

Date Written: December 1, 2018

Abstract

Solar, wind, and other clean, renewable sources of energy promise to mitigate climate change, enhance energy security, and foster economic growth. But many of today’s policies promote clean energy at the expense of equity, offering an uneven distribution of costs and benefits. Tax incentives for renewables cost American taxpayers billions of dollars every year, yet the tax code effectively precludes all but the largest banks and most profitable corporations from reaping the benefits of these tax breaks. Other policies, such as renewable portfolio standards that set minimum quota to create demand for renewable electricity require such high levels of market expertise and financial acumen that they engender similar social inequities—all in the name of an environmentally sustainable energy future.

To date, policymakers and scholars have focused primarily on the efficacy and, more recently, the efficiency of clean energy policy. This Article makes the case that the next generation of policies should incorporate equity as another first-order consideration in policy design and implementation. Properly defined as the commensurate matching of costs and benefits, equity offers a more reliable metric for distributional impacts than the charged and polarizing concept of fairness.

Empirical assessment and qualitative analysis of today’s leading clean energy policies reveal widespread issues related to equity and distributional fairness. Insights gleaned from a representative sampling of the global policy potpourri yield valuable design recommendations for the next generation of clean energy policies—a generation that is at once effective, efficient, and equitable.

As the green grid becomes ever more interactive and participatory, so, too, should the policies that enable the clean energy transition become more participatory. This Article suggests Elinor Ostrom’s polycentricity model as a powerful governance tool to produce more equitable clean energy policies.

Keywords: renewables, climate change, tax credits, equity, fairness, decarbonization, clean energy, solar, wind, polycentric governance, feed-in tariff, net metering, renewable portfolio standard, RPS, tender, auction, policy equity, outcome equity, distributional justice, environmental justice,

JEL Classification: D40, D62, E60, F01, H30, H51, H60, H70, K23, K32, L10, M13, O10, O32, O38, Q20, Q28, Q40, Q42, Q48

Suggested Citation

Mormann, Felix, Clean Energy Equity (December 1, 2018). Utah Law Review, 2019, Forthcoming; Texas A&M University School of Law Legal Studies Research Paper No. 18-67. Available at SSRN: https://ssrn.com/abstract=3295296

Felix Mormann (Contact Author)

Texas A&M University School of Law ( email )

1515 Commerce St.
Fort Worth, TX 76102
United States

Stanford Law School ( email )

Steyer-Taylor Center for Energy Policy and Finance
559 Nathan Abbott Way
Stanford, CA 94305-8610
United States

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