Home

2004-05 Seminars

Costs of the Texas renewables portfolio standard

Katerina Dobesova
Visiting Fulbright Scholar in EPP from the University of Economics, Prague, Czech Republic

Abstract
Texas implemented a renewables portfolio standard (RPS) in January 2002. The seminar will discuss the impacts of the federal production tax credit for renewables, transmission curtailment, construction of new transmission lines to relieve congestion, price of renewable energy credits (RECs), and RPS administration in 2002. The RPS has resulted in a cost premium for renewable power of 3.4 (US) ¢/kWh in 2002, which may fall to 2.8 (US) ¢/kWh after transmission constraints are relieved (these do not include the costs associated with buffering the intermittent generation from renewable sources with storage or backup generation). If the costs of the RPS are allocated to carbon emission reduction, the Texas RPS carbon mitigation cost is 60% higher than that of an integrated gasification combined cycle plant with carbon capture and sequestration (CCS), but below that of pulverized coal or natural gas combined cycle plants with CCS.