This working paper assesses the economic potential of renewable electricity generation in the South under alternative policy scenarios. Using a customized version of the National Energy Modeling System (NEMS), we examine the impact of 1) expanded and updated estimates of renewable resources, 2) a Renewable Portfolio Standard (RPS), and 3) a Carbon-Constrained Future (CCF). Under the Expanded Renewables Scenario, renewable electricity generation doubles the output of the Reference forecast for the South. If a Federal RPS is imposed or the policies represented by our CCF scenario are implemented, we estimate that 15% to 30% of the South’s electricity could be generated from renewable sources. Among the renewable resources, wind, biomass, and hydro are anticipated to provide the most generation potential. As the integration of renewable sources expands through the modeled time horizon, wind gradually out-competes biomass in the renewable electricity market. Cost-effective customer-owned renewables could also contribute significantly to electricity generation by 2030 in the South, under supportive policies.
Teaching Method: Background information; sample policy brief to have students update or apply elsewhere