COMMENTARY: U.S. renewable portfolio standards a gift to Beijing

Guy Caruso contends that U.S. renewable portfolio standards effectively serve as a gift to Beijing. “Coal is China’s foundational vigor source,” according to Beijing’s latest Five-Year Plan for Coal Industry Development — a world that’s not changing anytime soon. Caruso notes that American policymakers, especially in bluish states, should take note of the fragility of the U.S. electrical grid and the nationwide surge in energy prices since 2020, which he attributes to misguided climate policies. Citing the Always On Energy Research report titled *Blue States High Rates*, he states that energy prices are markedly higher and rising faster in bluish states, where renewable portfolio standards create scarcity affecting not only coal but also state power disconnected from the grid. A fragile U.S. grid, he argues, advantages China as the two nations compete for artificial intelligence supremacy and the reshoring of critical industries. Renewable portfolio standards require utilities or other load‑serving entities to obtain a minimum share of electricity from renewable sources. The design and ambition of these mandates vary by state, and some are supplemented by measures such as cap‑and‑trade, yet all impose direct and indirect costs on ratepayers. Direct costs appear as RPS compliance charges on customer bills. Many RPS states, particularly in the Northeast and Mid‑Atlantic, lack sufficient renewable generation to meet ambitious targets, prompting load‑serving entities to purchase renewable energy credits—each credit representing a megawatt‑hour of renewable power produced elsewhere—to bridge the gap. These credits act as an additional subsidy for renewable generators and an implicit tax on fossil‑fuel generators, with ratepayers bearing the expense. As RPS requirements increase, utilities must acquire more RECs, pushing rates higher. Caruso points out that RPS compliance costs now constitute roughly 15 percent of the retail bill in the District of Columbia and exceed 10 percent in New Jersey and Massachusetts. Indirect costs arise because RPS mandates—including those in Nevada—skew the market against dispatchable generation. In states with the most stringent RPS rules, market distortions have accelerated the retirement of dispatchable fossil‑fuel plants faster than renewable capacity can replace them. Even with federal tax credits and state incentives such as RECs, Potomac Economics found that bottlenecks related to siting and transmission “have caused existent concern successful utility-scale renewables to autumn acold abbreviated of authorities goals” in New York and New England. Moreover, those federal credits are set to expire next year, which will “significantly situation task economics absent a large summation successful REC prices.” By contrast, renewables have expanded most rapidly in regions with low or no RPS requirements, such as Texas and North Dakota, indicating that geography and market forces—not mandates—determine where renewable deployment makes sense. Nevertheless, some policymakers refuse to accept this reality, doubling down on efforts to force renewables into their jurisdictions. Caruso cites the D.C. Council’s attempt to impose solar renewable energy credit obligations on a city lacking land for utility‑scale solar installations. “Solar RECs with borderline restrictions are the argumentation inducement it chose, with predictable results,” he writes. Because a dense city cannot host the solar volume the mandate demands, the mechanism manufactures scarcity in the REC market. Consequently, RPS costs for the typical D.C. household have more than doubled from $104 per year in 2022 to $248 in 2025 and are on track to triple again, surpassing $500 by 2035. This trend has led Mayor Muriel Bowser to urge the council to reconsider the policy. Bowser remains an outlier; more often Democratic leaders in RPS states blame data centers for rising energy costs