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REN21 10 Years Report

33 01 NORTH AMERICA n GENERAL OVERVIEW Over the past decade, North America has become one of the top regions for renewable energy in terms of installed capaci- ties. The United States in particular dominates the country rankings for installed capacities and is considered to have the largest installed renewables power capacity with and without hydropower after China. Much of this has been driven by the decreasing costs of wind energy, cheap hydropower, diverse renewable energy resource potential, and the active role states, provinces and communities have play in promoting renewable energy. Overall, the continued expansion of renewable capacity has allowed the United States to remain among the top countries for employment in the renewable energy sector. Despite the advancements in terms of installed capacity, the United States’ share of renewables in overall power generation is still minimal, especially when benchmarked against other countries. Developments have been accompanied by a gradual shift in the perception of renewables among electric industry professionals. In the early 2000s, non-hydro renewable energy sources were generally still considered to be minor contributors to the energy mix, and were often termed “alternative” energy sources. Ten years later, electric utilities and grid operators increasingly rec- ognise renewables as serious contributors to the energy mix and are investing in both increasing shares of renewables, and the technologies and institutions needed to accommodate the vari- ability of wind and solar energy. Sub-national entities played an important role in changing this perception, with states such as California and Texas taking the initiative early on. While the fed- eral governments in the United States and Canada have enacted renewable energy support policies, significant activity also exists on the sub-national level. Fluctuations in federal initiatives have caused policy uncertainty in the United States and have led to swings in market size, partially accounting for the steep decrease in wind energy investments in 2013. Strong oil, gas and coal lob- bies as well as the recent extraction of shale gas may further affect the future growth of renewables in both countries. n MAIN DRIVERS FOR RENEWABLES As President Barack Obama highlighted in his inaugural speech in 2009, energy security and climate change are two of the main drivers of the expansion of renewable energy in North America. These concerns have been prevalent among federal policymak- ers, and among state and provincial governments. Additional reasons, both on a sub-national and national level, are the cre- ation of new jobs and the potential to become a technical leader in the industry, thus boosting trade and economic activity. Over the past ten years additional drivers such as the low cost of wind and the declining cost of solar, as well as policy incentives and government programs have aided in accelerating the deploy- ment of renewables. n RENEWABLE ENERGY POLICY DEVELOPMENT The North American policy landscape is characterised by a strong involvement of state and provincial governments in the setting of targets and enactment of policies. Targets for renew- ables exist predominantly on the sub-national level, though the United States has set some national targets for the use of renewables by the federal government. These also extend to the military, which is the country’s single largest energy consumer. In terms of the use of regulatory policies, state governments have remained frontrunners as federal governments have focused on fiscal policies and public investment. An exception to this is biofuel mandates and tendering, which were already being developed by the Canadian federal government at the beginning of the decade and by the United States towards the second half of the decade. The advancement of renewables in the United States has been driven primarily by two types of policies: federal tax incen- tives, particularly the Federal Production Tax Credit (PTC) and Investment Tax Credit (ITC), and state-level renewable portfolio standards (RPS). The cycle of expiration and short-term renewals of the PTC and ITC, as well as the political pressure on state RPS and net metering policies, have led to significant market uncer- tainty. At the same time there is hope that the proposed Clean Power Plan, as proposed by the US Environmental Protection Agency (EPA), will be implemented, thus encouraging more investment in renewables.

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