Invest in a Clean Energy Transition for Rural Communities

Invest in Rural Communities

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Invest in a Clean Energy Transition for Rural Communities

Climate change poses a grave danger to rural communities. Fires, floods, and droughts, rising temperatures, and extreme weather pose a physical danger and disrupt rural economies. Transitioning to clean energy will reduce carbon emissions, create clean energy jobs, and lower energy costs for consumers, small businesses, and municipal governments.

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Park County, Montana is using Federal funding to partner with Yellowstone Bend Citizens Council, an affiliate of the Northern Plains Resource Council, to launch a new solar project.

An initial step for many states to transition to clean energy is to develop clean energy production targets and greenhouse gas emission limits. Many states have enacted renewable portfolio standards to set targets for renewable energy production and/or net zero greenhouse gas emissions. Access to clean energy and grid resilience can be a challenge for rural communities if the grid infrastructure is lacking or too dependent on a single source. To address this and to support rural electric cooperatives, states have begun to develop microgrids, which can store and distribute energy during a grid outage. Rural areas often face greater challenges for clean energy investments, but states can create green banks to address the financing needs of rural clean energy and energy efficiency projects. Some states have also used tax credits to promote clean energy adoption.

In order to move toward a 100 percent clean energy economy, policymakers must prioritize environmental justice for frontline communities and a just transition for impacted workers. Socially disadvantaged members of rural communities are often the most impacted by the environmental hazards from extractive industries. Environmental justice requires that all members of rural communities are protected.

For too long, the many harms of the fossil fuel industry have fallen the hardest on communities of color and rural communities. State lawmakers can establish rules to hold fossil fuel companies accountable and to ensure that corporate polluters – not taxpayers – pay for hazardous cleanups or the safe closure of facilities.

Policy Priorities

  1. Federal: Pass coal transition legislation that takes meaningful action on the 7 Pillars of the National Economic Transition Platform. The platform identifies important actions to create a just transition, reclaim mine land, and build economic opportunities in communities dependent on coal, including a call to pass the RECLAIM Act.

  2. Federal: Pass $100 billion in appropriations for federally insured Hardship Loans from the USDA Rural Utilities Service, with conditions for loan forgiveness based on retirement of fossil-fueled power plants and documentation of new investments. These appropriations would facilitate the retirement of a huge majority of 300 rural electric cooperative fossil-fueled power plants currently in operation. In exchange for debt forgiveness, rural electric cooperatives will make equal investment in clean energy, distributed energy resources, energy efficiency, high-speed broadband, storage, and electric transportation.

  3. State: Enact bold renewable portfolio standards with environmental justice requirements.

  4. State: Support expanding the energy grid with green energy infrastructure.

  5. State: Direct financing toward green energy projects and eliminate tax credits for dirty energy projects.

  6. State: Hold oil and gas polluters accountable, and be mindful of false green energy solutions, such as biogas or methane digestors that process animal waste.

State Examples

  • Massachusetts (2021 MA SB 9) recently set a net zero greenhouse gas emissions limit by 2050.

  • Colorado (2021 CO SB 264) recently established clean heat targets to reduce carbon dioxide and methane emissions from gas distribution utilities, with a “significant potential to reduce emissions of methane from active and inactive coal mines, landfills, wastewater treatment plants, agricultural operations, and other sources of methane pollution through development of methane recovery and biomethane projects.”

  • Colorado (2019 CO HB 1314) has taken steps to plan for the transition of coal workers by creating a just transition office to develop education and training programs and a just transition advisory committee to draft recommendations to share with the governor and legislature.

  • A recently passed constitutional amendment in New York (2021 NY Prop 2) added the “right to clean water, clean air, and a healthful environment to the New York Constitution’s Bill of Rights.” New York (2019 NY SB 6599) has taken additional steps to address environmental justice, including the New York State Climate Leadership and Community Protection Act, which requires state agencies to follow equity-based programmatic and investment goals.

  • California (2018 CA SB 1339) and Hawaii (2018 HI HB 2110) have established service tariffs to compensate microgrid owners for use of their stored energy, and Connecticut law (CT Statutes § 16-243y) created a microgrid and resilience grant and loan pilot program. Recently enacted legislation in Maine (2021 ME LD 1053) creates a section within the state’s public utilities statutes for the regulation of microgrid, and Minnesota (2021 MN HF 6) recently allocated funds to a university microgrid research center for research and development of near-commercial microgrid products.

  • Connecticut (2011 CT SB 1243) was the first state to create a green bank, and a new Connecticut law (2021 CT HB 6441) expands the types of projects that the Connecticut Green Bank can promote investment in to include environmental infrastructure projects related to water, waste, and recycling, climate adaptation and resilient agriculture, land conservation, and parks and recreation.

  • Michigan (MI No. 2019-14), via executive order, established a task force that, among other things, was directed to assess the Upper Peninsula’s energy needs, with a focus on security, reliability, affordability, and environmental soundness.

  • Recently enacted legislation in Virginia (2021 VA HB 1919) authorizes localities to establish green banks.

  • Illinois legislation (2021 IL SB 2408) directs the Illinois Climate Bank to accelerate investment in clean energy projects that reflect the diversity of the state, including emphasis on racial, gender, and income diversity.

  • Maryland (2020 MD HB 980) recently increased the maximum tax credit for commercial energy storage systems from $75K to $150K.

  • Iowa (2015 IA HF 645) pegged their solar installation tax credit to 50 percent of the federal energy credit, with a maximum commercial tax credit of $20K.

  • Although now expired, Colorado (2015 CO HB 1219) created an enterprise zone investment tax credit of up to $750K for renewable energy investments, including from biomass, coal mine methane, and standard renewable energy resources. Oregon (2011 OR HB 3672) created a tax credit for renewable energy, which has since expired, that included “biomass, solar, geothermal, hydroelectric, wind, landfill gas, biogas or wave, tidal or ocean thermal energy technology.”

  • In Colorado (2019 CO SB 181), lawmakers strengthened regulatory authority over oil and gas operations, including requiring that operators install continuous monitoring equipment for hazardous air pollution and new local government permitting requirements. The new law also requires the state regulatory agency to adopt new rules that would increase the financial assurances required of operators to cover future cleanup costs.

  • California recently passed a bill (2021 CA SB 158) to increase accountability for environmental waste cleanups by establishing an ombudsperson to receive and respond to public complaints, increasing financial assurance requirements for entities that handle hazardous waste, and establishing an Impacted Community Grant program to fund community efforts to respond to and independently examine contaminated sites.

  • Legislation enacted by Illinois (2019 IL SB 9) lawmakers created new protections against coal ash polluters, including establishing financial assurance requirements for closure and cleanups and creating new standards for meaningful community participation in decision making processes.