Top States Promoting Alternative Energy

• Skip to Introduction to Alternative Energy to learn the basics of alternative energy.
• Skip to Methodology to learn more about how we researched state alternative energy.
• Skip to Editor’s Awards to learn which states deserve special attention for their promotion of alternative energy.

Overview of Research

Our team spent over 40 hours researching state alternative energy for this 2016 ranking.  We collected 26 types of federal data and then categorized them into five core metrics to use when ranking each state, weighing them depending on how important we thought they were in the promotion of alternative energy.  The five core metrics for our ranking, as identified by our research team, are: Production (35%), Efficiency (25%), State-Wide Goals (15%), Vehicle Efficiency (15%), and Incentives and Standards (10%).

Introduction to Alternative Energy

The term ‘alternative energy’ comes from its original definition as an alternative energy source to fossil fuels. Its meaning has since expanded to any energy type that is renewable or produced without the harmful environmental side effects associated with fossil fuels. This is a broad category that covers many different types of energy. Here are some of the most common alternatives to fossil fuels.

Types of alternative energy

• Biomass Energy: Biomass energy is obtained from burning plant material or animal waste.
• Geothermal Energy: Geothermal energy is obtained by utilizing the heat emanating from the Earth itself.
• Hydroelectric Energy: Hydroelectric energy is obtained by using moving water (usually through a waterfall created by a dam) to power a turbine.
• Hydrogen Energy: Hydrogen energy is a direct energy source where power is produced from burning liquid hydrogen.
• Solar Energy: Solar energy is the conversion of sunlight into electricity, either directly through photovoltaics or indirectly through concentrated solar power.
• Tidal Energy: Tidal energy converts the energy contained within ocean tides into electricity. These work similarly to more traditional hydroelectric power, in that they use the moving water to power a turbine.
• Wind Energy: Wind energy is the utilization of airflow through wind turbines to create electricity.

Methodology

How we selected which data to use in our methodology

We started by reviewing some existing rankings on alternative energy, such as Ecomagination’s Top Ten U.S. States for Renewable Energy Installed Capacity and Triple Pundit’s Top 10 Renewable Energy Producing States. These rankings were a good start for research, but their methodologies were too narrowly focused on the largest power caches and total energy production, a statistic that favors larger states. Their rankings did not take into consideration the finer details of state alternative energy promotion, which is what want our ranking to do.

We expanded our search, focusing mainly on official government websites to insure the data we acquired was as accurate as possible. Examples of government sources include the US Department of Energy’s Alternative Fuel Data Center, which shows current alternative energy laws and incentives sorted by state, and the US Energy Information Administration’s Alternative Fuel Vehicle Data report, which details the consumption of alternative fuel in a state’s vehicle fleet.  After spending time deciphering what reliable data was available for all 50 states, we finally settled on our 26 key data points.  These included production statistics, laws and policies, and vehicle fleet statistics, all straight from primary sources such as the Energy Information Administration the US Department of Energy, or the Database for State Incentives.  

There are a few drawbacks to our methods. Because of the data available, we were only able to cover five alternative energy types: biomass, geothermal, hydroelectric, solar, and wind.  Additionally, energy production data is not updated every year, so the most recent statistics we could find were from 2009.  We were also not able to cover other, less common alternative energy sources such as tidal power. This ranking also does not track certain indicators of clean energy usage, such as Co2 emissions or energy consumption rates.

We grouped our 26 key data points as sub-metrics into five core metrics.  This was to simplify how we would calculate our rankings and allows us to weight certain metrics over others, depending on how important they are to the promotion of alternative energy in the United States.

Since the focus of our ranking is rating the top states that promote alternative energy, we chose the production of alternative energy, measured in thousand british thermal units per capita, as our most important core metric.  Our second most important metric is Efficiency, which measures what percentage of the state’s total production is renewable. The Efficiency metric rewards states that are ultimately contributing most to the goal of 100% alternative energy.  The remaining metrics are detailed below.

Our methodology breakdown:

Metric 1: Production (35% of final score)

• Hydroelectric Energy: the total yearly hydroelectric energy production per capita
• Solar Energy: the total yearly solar energy production per capita
• Wind Energy: the total yearly wind energy production per capita
• Biomass Energy: the total yearly biomass energy production per capita
• Geothermal Energy: the total yearly geothermal energy production per capita

Metric 2: Efficiency (25% of final score)

• Efficiency: the percentage of yearly state production that is renewable

Metric 3: State-Wide Goals (15% of final score)

• Portfolio Alternative Energy Goals: a state regulation requiring increased production of energy from renewable sources
• Portfolio Maximum Price Increase for Consumers: an addendum to some state’s portfolio goals that limits the amount companies can increase the price for energy
• Public Benefits Funding: a fund dedicated to supporting energy efficiency, alternative energy, and research and development
• Net Metering: a law that determines if and how much of a facility’s or home’s excess renewable energy can be sold to the state

Metric 4: Vehicle Efficiency (15% of final score)

• Availability of Alternative Fuel Stations: the percentage of state fueling stations that provide alternative energy
• Renewability of Electricity: the percentage of state electricity that is generated from renewable sources
• Alternative Fuel Vehicles in State Fleets: the amount of alternative fuel vehicles in each state’s official vehicle fleets
• Alternative Fuel Consumption in State Fleets: the amount of alternative fuel consumed in each state’s official vehicle fleets

Metric 5: Incentives and Standards  (10% of final score)

• Alternative Energy Generation Disclosure Laws: requires that utilities provide their customers with information about the energy they are supplying
• Interconnection Standards: provides technical protection requirements, equipment specifications, application procedures, and other standards to ensure that renewables can be efficiently and safely interconnected to the grid
• Equipment Standards: standards to ensure quality of equipment and installation
• Contractor Licensing Requirements: ensures that contractors have the necessary experience and knowledge to install alternative energy systems
• Construction Standards: building code standards for solar installations, design standards, and performance requirements
• Personal Tax Deductions: covers a portion of the expense of installing alternative energy equipment
• Corporate Tax Incentives: allows corporations to receive tax deductions or credits for a portion of the expense of alternative energy equipment
• Sales Tax Incentives: provides exemption or reduction from the state sales tax when purchasing alternative energy equipment
• Property Tax Incentives: the added value of an alternative energy device over the cost of a non-renewable device is included in the valuation of the property for taxation purposes
• Grant Programs: available for alternative energy research and development
• Loan Programs: offers low cost financing for the purchase of alternative energy equipment
• RPS Energy Cost Cap: indicates the state’s renewable energy portfolio’s maximum cost

How we scored our methodology

After grouping the sub-metrics into their core metrics, we assigned each a score of 0-10. The sub-metric scores were determined by ranking each state against each other in that data point. The state with the best performance in that sub-metric was awarded a 10, while the state with the lowest performance was given a linear ranking depending on how many states scored in that sub-metric.  States that did not have anything in that sub-metric were given a 0.

For example, in the sub-metric solar energy production, Hawaii produced the most with 1944 thousand BTUs per capita and was awarded a 10 for that sub-metric. Tennessee and Mississippi tied for the least, producing 6 thousand per capita and were given the score of 0.3. Alaska and Wyoming both produced 0 and they received a score of 0. The final core metric scores were determined by averaging each sub-metric score (so all sub-metrics were weighted evenly).

Here’s an example of how our #1 overall state, Oregon, scored an 8.1/10 for the core metric Vehicle Efficiency. The Vehicle Efficiency metric is made up of four sub-metrics; here’s how Oregon scored for each one:

• Availability of Alternative Fuel Stations – 9.8/10
• Renewability of Electricity – 9.2/10
• Alternative Fuel Vehicles in State Fleets – 6.6/10
• Alternative Fuel Consumption in State Fleets – 6.8/10

Once the sub-metrics were averaged, we took each state’s score on the five core metrics, applied the weights detailed in the previous section, and calculated the end ranking.

Understanding Our Metrics

What is important for alternative energy promotion and why?

Editor's Awards

With the most alternative energy production per capita out of any state and a close runner-up in efficiency, Oregon is our top state promoting alternative energy.

Oregon is known for its extensive hydroelectric power on the coast and formidable solar power in the eastern part of the state, ranking 3rd and 6th in these categories overall.  Oregon also sets an excellent example in alternative energy efficiency, with renewable sources making up an impressive 99.8% of Oregon’s total produced energy.  The state provides alternative fuel at more than one third of its total fueling stations, and two thirds of its electric power is provided by alternative sources.

Drawbacks:

• Oregon has conservative portfolio energy goals compared to our other top states
• Net metering in Oregon is severely limited

Ranking Results:

• Production: 7.9/10
• Efficiency: 9/10
• State-Wide Goals: 4.8/10
• Vehicle Efficiency: 8.1/10
• Incentives and Standards: 6.7/10

California is the forerunner in vehicle efficiency.

California has the largest alternative energy fleet in the United States, employing more than twice as many alternatively fueled vehicles as New York, the state with the next largest fleet.  Even accounting for California’s large population, its alternative energy fleet is the second largest per capita of any state.  That fleet has a greater alternative energy use than any other state fleet and is supported by a top-tier alternative fuel infrastructure. For example, 38% of California fuel stations offer alternative energy.

Apart from vehicle efficiency, California also boasts the second largest total alternative energy production of any state and is top 10 in our per capita ranking.  California has some of the most extensive state laws detailing its future goals and pours massive amounts of money (roughly $235 million a year, or 1.4% of its utility revenue) into incentivizing and promoting alternative energy.

Drawbacks:

• Even though California produces the 2nd most alternative energy of any state, its alternative energy production is only 24% of its total energy production

Ranking Results:

• Production: 6.1/10
• Efficiency: 5.4/10
• State-Wide Goals: 6.2/10
• Vehicle Efficiency: 9.3/10
• Incentives and Standards: 7.8/10

Washington contributes the largest alternative energy power cache in the United States and is a powerhouse in hydroelectric energy.

Washington is the largest producer of alternative energy in the United States, totaling approximately 826 trillion BTU’s every year, with around 86% of that coming from hydroelectric sources.  Its hydroelectric energy production alone is greater than the total alternative energy production of any other state.  Washington also receives top marks for its vehicle efficiency, with 30% of its stations offering alternative fuel. Finally, 73% of its electricity is renewable.  This makes California the second-best scoring state for that metric.

Drawbacks:

• Washington is lacking in its solar and wind production, ranking in the bottom 20 states for each category
• Washington’s renewable portfolio goals are lower than other high ranking states
• Washington does not have alternative energy public benefit funding
• Washington’s has a low net metering policy

Ranking Results:

• Production: 6.3/10
• Efficiency: 8.4/10
• State-Wide Goals: 2.6/10
• Vehicle Efficiency: 8.4/10
• Incentives and Standards: 5.6/10

Hawaii has 100% alternative energy production and the highest energy portfolio target of any state.

Hawaii lacks in some areas, such as vehicle efficiency, but it is the only state to officially strive for 100% renewable energy consumption. On top of already producing 100% alternative energy, Hawaii endeavors to use only renewable resources for power by 2045.  The next most ambitious states in regards to a total renewable energy conversion are Vermont, New York, and California, with 75%, 50% and 50% alternative energy goals respectively.  Hawaii’s incentives are also some of the best according to our metrics.  

Drawbacks:

• Hawaii’s state fleet is far behind in terms of renewability
• Hawaii has not set a maximum price increase for energy
• Hawaii has no funds involved in alternative energy public benefit
• Hawaii has a low net metering policy

Ranking Results:

• Production: 5.7 /10
• Efficiency: 10/10
• State-Wide Goals: 3/10
• Vehicle Efficiency: 3.6/10
• Incentives and Standards: 7.8/10

New York’s top-mark incentives combined with its ambitious portfolio goals make New York a strong promoter of alternative energy.

New York received the highest score for our core metric Incentives and Standards, with laws enacted for 9 out of the 12 categories of alternative incentives included in this metric. This makes New York incentives as comprehensive as any state; it has generation disclosure laws, RPS energy cost caps, interconnection standards, construction standards, personal, corporate, sales and property tax incentives, as well as loan programs for alternative energy projects.  New York also incentivizes alternative energy with the sixth largest net metering policy out of any state.

New York compliments this comprehensive policy program with impressive portfolio goals, striving for 50% alternative energy usage by the year 2030, while keeping energy price increases to below 1.7%.  

Drawbacks:

• New York’s production scores are not in the top ten for any of the five energy types we reviewed
• Only 18% of its stations offer alternative fuel, which is lower than other high-ranking states

Ranking Results:

• Production: 4.7 /10
• Efficiency: 7.4/10
• State-Wide Goals: 6.3/10
• Vehicle Efficiency: 8.4/10
• Incentives and Standards: 10/10