The Institute for Policy Integrity produces three types of publications: policy briefs, reports, and academic articles/working papers. Our policy briefs provide incisive and focused analysis on timely policy topics. Our reports develop deeper research on our core issues. Our academic articles and working papers offer original scholarly research and analysis from established experts as well as fresh new voices.
An Economic and Legal Guide
This report explains how carbon-pricing rules in organized wholesale electricity markets can improve economic efficiency. It then explores the economic principles and legal requirements for RTOs, states, and the Federal Energy Regulatory Commission to consider when implementing a carbon-pricing rule in organized wholesale electricity markets. And it identifies several policy-design approaches that, to varying degrees, meet those economic principles and are likely to be found legally permissible.
Reducing Fossil Fuel Dominance on Public Lands by Accounting for Option Value
While the Trump administration’s goal of “energy dominance” has increased the public lands available for oil and gas development, no effort has been made to modernize the leasing system, even in the face of climate change. Our report explains how option value—which accounts for the informational value gained by delaying leasing decisions—can and should be factored into the Bureau of Land Management’s land use planning processes. Accounting for option value at multiple stages of the land use planning process would significantly improve BLM’s public lands stewardship, better protect the environment, and regain some of the economic and strategic advantages it has ceded to private developers. The report also describes case studies where BLM’s failure to consider option value has led to costly litigation and missed opportunities.
The U.S. Environmental Protection Agency (EPA) is considering a new policy that would prohibit the agency from issuing regulations that rely on studies whose underlying data are not publicly available. While the EPA claims it is pursuing this policy in the interest of transparency, we argue that such a prohibition would greatly hinder, rather than help, the rulemaking process and would likely result in undesirable regulatory outcomes that fail to maximize economic welfare.
Academic Article/Working Paper
Growth in electricity storage has the potential to increase emissions from power generation. Concerns about this outcome are currently prompting many policies to address the issue. We study a particularly popular policy proposal called the “Clean Peak Standard” that incentivizes storage to discharge during periods of high electricity demand. The stated goal of the policy is to shift storage discharge to offset production from generators with high pollution emissions. We show that the policy is largely ineffective at achieving this emissions reduction goal. The policy reinforces existing incentives faced by storage operators, so it does not have a strong effect on discharging behavior. It is also unable to capture high-frequency changes in marginal operating emissions rates. Alternative policies, such as a carbon tax, are more effective at reducing the emissions increase caused by storage. Policymakers considering Clean Peak-style policies should instead consider these alternative policies.
Using a Societal Value Stack
Our report notes the growing presence of distributed energy resources, like solar panels and energy storage installations, and explains how they should be compensated for providing electricity services valued by utilities and their customers. Currently, 40 states use net energy metering programs to compensate DERs. We describe a promising alternative, “value stacking,” which better reflects DERs’ value, and provide suggestions for how to implement this approach.