Renewable energy policy: Enumerating costs reduces support

Renewable energy policies enjoy greater support compared to policies focused explicitly on climate change, and thus present a politically plausible path toward carbon emission reduction. However, new research shows that renewable energy policy support declines when people are informed about the policy costs for home energy bills.

The 2015 Paris Agreement's goal of keeping average temperature increase ‘well below’ 2 °C, with an ambition of no more than 1.5 °C, invokes the need for herculean mitigation efforts. Such mitigation is necessary to help stem the worst effects of climate change and is arguably nowhere near realization in practice¹. Whilst many nations have implemented policies and incentives that move in the right direction, other nations fall behind — notably the United States under its current federal-level perspective on energy policy. The question arises of how proactive policies can be advanced. Social support for policies and technologies aimed at reducing carbon emissions has been shown to be essential for policy and technology implementation². Concern about climate change has stagnated in recent years worldwide, and is typically lower in the United States than in much of the rest of the world³. Nevertheless, some policies that reduce carbon emissions but that do not focus specifically on climate change or global warming enjoy higher support — for example, policies promoting renewable energy generation⁴. Focusing on such policies is promising as a politically and environmentally expedient route to carbon emission mitigation.

One way forward is to identify the type of policies to target. Another is to ascertain how best to describe those policies. Research has begun to focus on how communication — framing in particular — can increase climate change concern and, by extension, policy support^5–7. In new research published in Nature Energy⁸, Leah Stokes, from the University of California, Santa Barbara, USA, and Christopher Warshaw, from MIT, explore the confluence of these two pathways — how can framing of renewable energy policy advance policy support? The researchers employ an experiment within a survey of 2,500 US respondents, who were randomly assigned to receive brief statements of positive or negative information about renewable energy policies prior to rating their support for state-level ‘renewable portfolio standards’ (similar to the ‘renewables obligation’ in the United Kingdom) on a 4-point scale. The authors demonstrate that, compared to respondents in a control condition who received no additional information, providing additional information significantly influenced support for these standards. Previous research has similarly shown that providing additional information can significantly alter policy support for renewables, but relied on lengthy information sessions and deliberative workshops that provided much more information than could readily be shared en masse with the public^9,10, or only focused on negative attributes¹¹. Stokes and Warshaw examined brief facts — with both positive and negative connotations — that could be quickly communicated.

In Stokes and Warshaw's study, support for a specific policy — a requirement that the respondent's state meet 35% of its electricity needs with renewable sources by 2025 — was most strongly affected by information that the policy could increase household energy bills. Policies adding US$10 per month to energy bills led to 13% more respondents opposing the policy in the treatment compared to the control condition. The authors estimated that such a drop in support would cause 33 states to swing from a majority in support to a majority opposing the policy. Even information about a US$2 per month increase had a notable effect, with 6% more respondents opposed compared to control respondents. Conversely, providing information about reduced air pollution and increased jobs increased support.

This insightful research has substantial policy relevance but also highlights an important gap in the research literature on public perceptions of energy transitions and associated policy interventions. The dearth of literature heretofore on perceptions of public costs associated with energy and climate policy has, perhaps, suggested that support for renewable energy policies is higher than may actually be the case, because research on renewable energy broadly neglected consideration of who bears the costs. Decision-makers cannot base policies on the broad support that renewables enjoy without accounting for who pays and how much.

The limited research touching on why the public are opposed to costs associated with low-carbon energy policies suggests that opposition to costs might have just as much or more to do with procedural and distributive justice considerations as with personal financial status^10,12. Data collected from a survey and deliberative workshops in the United Kingdom show that distrust in energy companies reduces public willingness to fund policies, even amongst those who can afford to pay¹⁰. Thus, we can pose the empirical question of whether increased trust and perceptions of fairness could mitigate the downward effect of energy-bill costs on policy support. We can also ask whether high aversion to cost acceptance extends beyond the United States, as UK research¹⁰ found average acceptance of £95 (approximately US$125) annually for an almost identical policy to the one considered by Stokes and Warshaw⁸.

In addition to exploring why costs affect policy support, further research is needed to understand how support for state policies (such as renewable portfolio standards) and national policies (such as the United Kingdom's renewables obligation) can affect policy implementation. Stokes and Warshaw⁸ have revealed macroscopic patterns in relation to the effect of additional information on support for policies. Nevertheless, contextual factors (for example, cultural proclivities, social structure, shared values and history) within individual states — perhaps specifically those states currently lacking renewable portfolio standards (Fig. 1) — could reduce or heighten the extent to which information affects support. Furthermore, although Stokes and Warshaw found a correlation between renewable policy support and whether a state has an extant policy or not, it remains unclear whether support leads to policy implementation, or whether the opposite relationship or feedback loops exist. Further exploration in these areas is warranted.

Figure 1: Renewable portfolio standards in the United States.

RAINER LESNIEWSKI/ALAMY STOCK VECTOR

States with renewable portfolio standards (blue), with renewable portfolio goals (yellow), and with neither standards nor goals (white). Data source: US Energy Information Administration.

It is unrealistic to assume that the costs of renewable energy policies will not be passed on to the public. Many of the currently implemented and envisioned policy tools for reducing carbon emissions in the energy sector require the public to foot at least some of the bill, whether through taxes, explicit levies on energy bills, or via increases in energy costs passed down from energy companies with higher operating expenses. In the UK, modelling of energy transitions often explicitly assumes that policy programme costs will be paid through levies on household energy bills¹³. Stokes and Warshaw⁸ have provided empirical evidence for the extent to which information about policy costs on energy bills can curtail support. Importantly, the negative effect of the cost framing (at US$10 per month) had more influence on support than all the positive frames combined. The next steps are to determine why costs decrease policy support, clarify how support actually translates into policy implementation, and then determine the extent to which such policies precipitate tangible renewable energy projects on the ground¹⁴. This understanding could bring us closer to effective climate change mitigation through greater reliance on renewable energy.