Clean Resilient States: The Role of U.S. States in Addressing Climate Action

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Introduction

U.S. states have always played an important role in setting the nation’s energy and climate policies, each charting their own course for energy production, consumption, and environmental impact within the bounds of often inconsistent federal regulation. The Biden administration has pledged to shepherd in a new era of federal-level climate action in the United States with commitments to expand renewable energy and achieve carbon neutrality by 2050, a goal already adopted by a number of states. However, these plans will be subject to the limitations presented by a Congress that is deeply divided on climate change. For this reason, state-level policy will continue to play a critical role in shaping the country’s progress in addressing climate change.

While not all states support the Biden administration’s net zero emissions target, at some level all states do recognize value in addressing three energy-related climate imperatives: to reduce greenhouse gas emissions, to create clean economic growth and opportunity, and to build resilient energy infrastructure. States demonstrate a wide range of approaches to prioritizing these imperatives. Some are enacting comprehensive climate action plans, while others are creating policy in a more piecemeal fashion. Relative to the inconsistency in federal energy and climate policy, some states have been pursuing energy and climate strategies, with revisions, for nearly two decades. Variation in state approaches provides rich opportunities to identify barriers to, and enablers of, successful design and implementation of climate and energy measures. Studying this variation can provide valuable lessons about which strategies have worked and which have fallen short.

The CSIS Energy Security and Climate Change Program created the Clean Resilient States Initiative to draw lessons from these state-level approaches to emissions reductions, clean economic growth, and energy resilience. These insights will inform recommendations aimed at advancing state progress in each of these areas as well as better integrating initiatives across them. To set the stage for the new initiative, this introductory paper discusses how key measures of emissions reductions, clean growth, and energy resilience may shape perceptions about state performance in addressing climate change imperatives.

Emissions Reductions

Reducing greenhouse gas emissions is a central requirement for slowing the harmful effects of climate change and is therefore the central target for state-level climate policy. Most states are making progress in reducing emissions in the production of electricity through policies that expand efficiency measures and renewables. Half of all states have now established emissions reduction targets, but these targets are not always linked to specific policies or plans to achieve them. Moreover, not all of the deepest emissions reductions in the last decade have come from the states with the most ambitious policy targets. These observations highlight a growing momentum among states around climate action, but also the need for greater clarity about where and how states are affecting emissions reductions.

States have different starting points

In evaluating progress in state emissions reductions, it is helpful to bear in mind that all states need to follow the same relative path to reducing emissions. In general, this path begins with increasing end-use electricity efficiency and decarbonizing electricity production. On this front, most states have made some headway through policies that require efficiency and renewable energy production. Beyond this early part of the path, states must electrify transportation, machinery, and industrial technologies, then finally decarbonize hard-to-electrify sources of emissions.

States are imbued with different characteristics that may make this path easier or more difficult. To understand why, it is useful to differentiate between absolute emissions and emissions intensity. Absolute emissions are a function of each state’s population and economy. States with the highest absolute emissions tend to feature large populations and robust economies, such as Texas, California, Illinois, and New York. In ranking states by emissions intensity (i.e., the state’s absolute emissions by its gross domestic product), population is no longer the primary correlate. Instead, emissions intensity corresponds more closely to the structure of each state’s economy and the amount of energy it requires. States with (desirably) lower emissions intensities tend to feature more service-based economies, which require relatively little energy consumption (either per capita or per unit of GDP). States with higher emissions intensities tend to have more prominent industrial or agricultural sectors, with greater energy consumption used to power heavy equipment and machinery. Since emissions intensity reflects differences in energy consumption, it is a good proxy for the relative cost and complexity of the pathway a state must take to reduce its emissions. 

Among lower emissions intensity states, it is likely that significant emissions reductions can be achieved through energy efficiencies and the expansion of renewable energy in electricity production. These technologies are increasingly reliable, affordable, and common. By contrast, emissions reductions in states with higher emissions intensities will require a broad set of strategies and resources beyond energy efficiencies and renewables, including some “radical product innovations” to replace fossil fuels in industrial and agricultural applications.

In the way that state economic structures pose different challenges for emissions reductions across states, other attributes may also shape the relative ease with which states achieve emissions over time. State climates may have important implications for improving the energy efficiency of buildings, for example. Likewise, it may be easier to reduce emissions associated with transportation in more densely populated states. These features and others are an important part of contextualizing state progress in reducing emissions over time.

Progress has been both intentional and incidental

In recent years, many states have made formal commitments to emissions reduction targets or goals. To date, 25 states and Washington, D.C. have committed to targets commensurate with the Paris Climate Agreement. These commitments, while emblematic of climate leadership or ambition, are not based on—and do not reflect—past progress. Moreover, the majority of states with these commitments are low-intensity emitters, which means they are states that may benefit from lower-cost, more straightforward pathways to emissions reductions. This does not detract from the merit of enshrining emissions reduction targets in formal commitments. Indeed, they are important, because they act as an unambiguous signal that reducing emissions is a state priority. Still, there remains much to be understood about how these commitments may propel emissions reduction activities and achievements in states with varying economies and emissions profiles.

In evaluating progress in state emissions reductions, it is also important to note that many states have realized emissions reductions as the result of events beyond their control. A notable example here is the market shift from coal to natural gas-powered electricity production in the last decade, which resulted in precipitous carbon reductions in many states without significant policy change or investment. In opposition to this fortuitous source of decarbonization, states sometimes also see reduced emissions as a result of undesirable economic downturns, as observed throughout the Covid-19 pandemic. Together, these examples illustrate how emissions reductions are not always attributable to state-level priorities or policy, and why past performance is not necessarily indicative of future progress.

All states need to follow the same path to achieve emissions reductions, and many states have demonstrated early progress owing to state-level initiatives, events beyond their control, or both. As states expand efficiency measures and renewables deployment, they will all face deeper challenges further down the decarbonization path. Still, some will face greater challenges than others. Beyond these observations, there remains much to be understood about which states are best positioned to deeply decarbonize and how other states can learn from their example. Nonetheless, there are some notable patterns emerging across states; assessing these patterns can provide useful insights about how state policies are contributing to emissions reductions, and it can tell us where there is room to improve and how to advance progress in this area.

Economic Benefits

Addressing climate change is often framed as a double benefit, in which reducing dependency on carbon-based energy also provides expansive potential for “clean,” “green” jobs, industries, and innovation. While most states have adopted policies to promote energy transitions, these policies vary considerably. There is a general consensus about the value of these policies for expanding renewable energy generation. However, there remains much to be understood about whether and how state energy policies supply promised economic co-benefits.

Economic and natural resource context matters

While policy support for clean energy is increasingly common across states, clean energy jobs and industries notably tend to be concentrated in particular regions. This is a reflection of the fact that state energy policies do not occur in a vacuum and that policy efficacy is shaped in part by underlying state characteristics. For example, renewable energy policies may be more effective in states with greater renewable resource potential; this potential is shaped by natural attributes beyond state control, such as topography, solar irradiation, and wind intensity. Other, more malleable characteristics may also affect how effectively state energy policies can foster economic benefits. State and local infrastructure play a factor in the technical feasibility of certain investments. For example, siting decisions for wind turbine manufacturing are often constrained by low highway underpass heights, and utility-scale solar can be limited by urban development and sprawl. Since “clean,” “green” jobs generally require higher thresholds of education and training than traditional employment, workforce characteristics are another important limiting factor. State energy policies may be more successful in attracting firms and creating jobs where there is already an established presence of mid-skill workers and subsectors (such as construction and manufacturing). Given the significance of infrastructure and workforce development, states that feature relatively similar energy policies may achieve considerably different economic benefits based on these characteristics. As a result, some states may require infrastructure and workforce development initiatives in order to maximize economic co-benefits associated with clean energy.

Regulatory tools appear effective, but more investigation is necessary

Broadly, states seek to promote clean energy and associated co-benefits through two kinds of policy: regulatory and financial. The majority of states now feature regulatory measures in the form of energy efficiency standards, renewable portfolio standards, and net metering. A smaller but growing number of states have also established regulations for grid modernization, feed-in tariffs, and energy storage targets. These regulations support job creation and investment by ensuring stable and predictable clean energy market environments and revenue streams. Financial incentives are also provided by a majority of states, including tax credits, grants, and financing mechanisms, often through public benefit funds. Such incentives aim to directly attract renewable energy investment and job creation by offsetting high initial capital costs and minimizing financial risks for new and expanding firms.

Most states feature a mix of regulatory and financial policies. However, much of the research that links state energy policies to economic impacts focuses on the design and efficacy of individual policies or policy types. Relatively few studies examine how multiple policies and policy types may work together to produce economic impacts within and across states. Among those that do, regulatory policies are generally found to be more effective than incentives in creating jobs, while financial incentives have been linked to greater renewable energy innovation. These studies provide a useful starting point for understanding how state energy policies foster economic co-benefits, but the connection is not quite so direct.

Do economic co-benefits really create additional support for more ambitious policy?

Apart from the efficacy of particular policy choices and contexts, there is another aspect of economic co-benefits that warrants consideration: how they may affect future energy policy. The promise of co-benefits is often assumed to garner support for climate action and energy transitions, and in the last decade climate action has increasingly been framed in terms of economic benefits, rather than costs. These co-benefits are often envisioned to include not only more jobs, but higher-quality jobs with better pay and greater worker protections—union jobs, for example. However, it is not clear whether states that successfully cultivate clean energy jobs and growth garner more support for more ambitious policies over time, nor is it certain that states which fail to do so lose support for climate and energy policy. The importance of jobs and growth to the future of clean energy policy may depend on the state and the kind of economic activity it aims to promote. In some states, low-cost, carbon-based energy resources continue to be the most important driver of the overall economy. On this end of the spectrum of state circumstances, clean energy may provide only supplementary economic diversification. On the other end of the spectrum, however, clean energy may be envisioned to foster technological innovation and radical economic transformation, while in the middle range, energy transitions present an opportunity to mobilize disadvantaged or inactive parts of the labor force. In each of these cases, the consequences for creating jobs and stimulating economic activity (or for failing to do so) may be different. More qualitative insights are required to understand whether and how states prioritize and achieve these different kinds of economic co-benefits.

In rhetoric and policy, states frequently frame climate action and energy transitions in terms of economic co-benefits, and their policies encompass a diverse array of regulations and incentives that aim to promote clean energy projects and associated jobs and growth. Evaluations of these policies suggest that resultant economic impacts are mixed, and that policy efficacy is shaped by state workforce, infrastructure, and natural resource characteristics. The findings provide a framework for beginning to understand whether states are successfully supplying clean energy jobs and growth through their policy mixes, and why promises may sometimes fall short. However, there are open questions about the nature of the economic co-benefits that states are pursuing, and whether co-benefits affect support for future climate and energy policies. A deeper understanding of these dynamics could play an important role in accelerating state energy transitions and climate action.

Resilience

As climate change increases the frequency and intensity of natural hazards, states are likely to face increased exposure and vulnerability in their energy sectors and beyond. Targeted energy sector resilience enhancements aim both to mitigate damage from climate hazards and impacts and to expand system capacity for operational continuity despite damage. These enhancements, and their potential to minimize the duration and frequency of power outages, will become increasingly important as states electrify their economies to support their energy transitions. Not all states are pursuing these measures with the same level of urgency, nor do their efforts materialize in the same ways.

Resilience strategies include ongoing assessments and multiple approaches

State efforts to mitigate damage from climate hazards generally take the form of anticipatory planning and energy system design choices. Vulnerability assessments are an important part of the planning process. In these assessments, states identify the nature of pertinent climate hazards and thresholds at which the severity of each hazard is likely to affect key energy assets or overall performance. Vulnerability assessments guide preemptive investment, design, and management strategies that “harden” energy systems to reduce climate hazards. System hardening also enhances their capacity for continuity of operations when climate impacts inevitably occur—a property sometimes called “absorptive capacity.”

Hardening measures encompass a broad swath of investments and improvements. Energy diversity, redundancies, pole reinforcing, and undergrounding electric lines improve absorptive capacity in ways that are fairly intuitive. Measures frequently associated with grid modernization—including energy conservation and efficiency measures, demand response, and smart meters—may also harden the grid by enabling more sensitivity to, and swifter resolution of, system disruptions. Renewable technologies are a growing feature of grid-hardening decisions, and they are increasingly viewed as a source of absorptive capacity because they are conducive to storage and microgrid configurations. Microgrids are distributed renewable electricity infrastructure (typically solar) that normally operate in connection with traditional, centralized utilities (i.e., macrogrids). If and when damage to a macrogrid occurs, microgrids can be disconnected from them and set to continually operate in “‘island mode” until the macrogrid is repaired. Islanding is especially valuable for ensuring the continuity of operations in electricity-reliant “lifeline networks,” such as well water pumps and telecommunications. As such, some states have invested in microgrids for critical infrastructure, such as emergency shelters and hospitals. Expansion of these distributed renewable energy applications will be increasingly important as states proceed with energy transitions and electrify transportation and other sectors of their economies. To this end, seven states have already created energy storage targets to facilitate the adoption of this technology, and three additional states have utilities which offer financial incentives for doing so. Six states have also established publicly-financed banks or funds to increase the availability of low-cost financing for renewable technologies that reduce vulnerabilities. Examples include New Jersey’s energy resilience bank, Rhode Island’s infrastructure bank and Connecticut’s green bank.

Past experience may shape initiatives

While all states face escalating climate hazards, the perceived need for resilience planning is shaped in part by the frequency and severity of disasters in recent memory. In some cases, disasters provide momentum to expand low-carbon, more resilient energy systems as part of their recovery efforts. Following Hurricane Sandy, about two-thirds of New Jersey residents and nearly a quarter of New York residents lost power. Subsequently, bothstates developed policies to support the development of cleaner, more resilient energy systems. Likewise, persistent wildfires have prompted an accelerated deployment of microgrids in California, and prolonged outages in Oregon’s coastal communities prompted plans for small-scale wave energy devices that supply standby renewable capability during disaster recovery.

Alongside initiatives spurred by disaster, there is growing interest in resilience across states. Eighteen states have adopted or begun work on a dedicated climate resilience or adaptation plan, and six more states have plans in development. While these plans generally support the creation of task forces or working groups and vulnerability assessments, the resulting recommendations and timelines for implementation vary considerably. A few states have created public platforms to depict anticipated vulnerabilities, sometimes overlaid with plans to mitigate them. These platforms help local governments and residents understand climate-related vulnerabilities. They also support efforts to “mainstream” resilience, integrating considerations of resilience into investments, policies, and practice as a matter of course at the state level—but also at the community level, where resource management decisions can play an important role in fostering resilience. While post-disaster initiatives and preemptive planning point to resilience as an area of growing policy attention, the unpredictable nature of natural disasters means that it can be difficult to assess whether these investments are adequate or cost-effective. As a result, case studies and qualitative findings may be especially important in understanding how state policy choices are reducing vulnerabilities and enhancing resilience.

Although this review of state efforts to bolster energy resilience captures the fundamentals, it also presents a convenient level of abstraction. The diversity of climate hazards that states face varies considerably, and so do strategies to harden energy systems. This creates some “conceptual fuzziness” about what resilience looks like in practice, which may explain why there is relatively little systemized data about how states are pursuing energy resilience. While each state’s particular context is unique, there are some overarching themes about how renewable and low-carbon energy technologies fit in to broader state resilience strategizes. Optimal deployment of these technologies is increasingly important, but the rise of renewables is likely to create a new set of vulnerabilities and resilience challenges. Anticipating and resolving them will be increasingly important as state energy transitions advance.

Coordination and Conflict

Emissions reductions, clean growth, and energy resilience are distinct but interrelated imperatives, and states that are serious about addressing climate change must consider them all. However, these imperatives are not always thought of together, so it can be difficult to anticipate all of the potential co-benefits and trade-offs they might beget. For this reason, state success in each of these areas is partly contingent on efforts to strategize around and coordinate across all three imperatives. States demonstrate wide variation in their coordination efforts, which may take the form of comprehensive policy documents, designated planning committees, or new administrative agencies. A clear understanding of outcomes resulting from state climate and energy policies must account for these the coordination efforts, because they often reflect new and evolving state priorities. For example, states are increasingly incorporating considerations of environmental justice into energy policy, seeking to enhance clean adaptive capacity and opportunity in communities that have been disproportionately burdened by pollution and climate change. Since this emerging priority takes on dimensions of emissions reductions, clean growth, and resilience, it cannot be fully accounted for without a wider view of how states are coordinating across policy areas.

Alongside the challenges of internal coordination, states face choices about whether and how to engage on issues of climate action beyond their borders. There are potential benefits to be had in “horizontal” coordination among states. Consortiums to facilitate policy learning, foster green growth, and plan for climate hazards are typical examples of these benefits. Willingness to coordinate is often conditional on some degree of priority alignment across states. Conversely, where states lack shared priorities there is potential for conflict to arise, particularly among states that trade energy or rely on common energy infrastructure. These conflicts may complicate, slow, or reverse state climate and energy initiatives.

Similar potential for coordination and conflict arises between states and the federal government. Research and development of energy technologies and resilience planning are two areas wherein states have historically benefitted from “vertical” coordination with federal agencies. However, divergent priorities between states and federal authorities have also led to conflict, notable examples of which have emerged in federal preemption efforts respecting power plant and vehicle emissions. Apart from a new national agenda, President Biden may support considerable progress in state-level climate initiatives simply by scaling back such challenges to them.

States demonstrate varying degrees of proficiency in managing competing policy imperatives, navigating conflict, and capitalizing on the potential for coordination. Over time, those that anticipate, manage, and resolve disjunctions and inefficiencies are likely to fare the best in advancing goals. Therefore, identifying and expanding successful strategies to address these kinds of challenges hold value for improving state climate and energy initiatives.

Conclusion

Across states, there is growing momentum around climate and energy policy, and their efforts represent significant contributions to the country’s overall progress in addressing climate change. Still, there are looming questions about how states’ varying strategies will affect meaningful progress in emissions reductions, clean growth, and energy resilience.

With respect to emissions reductions, some states have committed to ambitious targets. Most of these targets are fairly recent, so it is not yet clear how they may translate into material reductions. At the same time, states without declared targets may be achieving emissions reductions, but it is unclear to what extent these states prioritize emissions concerns; and their lack of targets may suggest they face greater barriers to deep reductions.

“Clean,” “green” economic growth opportunities are an impetus for many climate initiatives, but different states’ policies may affect how those benefits are defined and distributed, and there is much to be understood about how these values are reflected in policy and realized in implementation.

In addressing resilience, every state faces pressure to harden power grids against climate hazards that are growing in frequency and severity. Grid modernization and the incorporation of renewable and distributed technologies are critical aspects of ensuring energy resilience. However, the specific means by which these enhancements are achieved and the form they take are greatly dependent on the unique combination of hazards each state faces.

As addressing climate change becomes increasingly imperative, states are demonstrating a wide range of related policy priorities and management approaches within their borders and in coordination beyond them. Given this variation and complexity, it is not immediately obvious which states are making the most progress or why, but there are important insights to be drawn from this wealth of diverse policy experience. Learning from these experiences is important even as the president may ring in a new era of climate action at the federal level, because climate and energy policy will continue to be a critical issue of multilevel governance.

Morgan Higman is a fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Sarah Ladislaw is senior vice president, director, and senior fellow with the CSIS Energy Security and Climate Change Program. Nikos Tsafos is a deputy director and senior fellow with the CSIS Energy Security and Climate Change Program.

This report is made possible by the Alfred P. Sloan Foundation.

This report is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2021 by the Center for Strategic and International Studies. All rights reserved.

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Morgan Higman

Morgan Higman

Fellow, Energy Security and Climate Change Program
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Sarah Ladislaw

Sarah Ladislaw

Former Senior Associate (Non-resident), Energy Security and Climate Change Program

Nikos Tsafos