Developments In National Energy Policy

Study Case DEVELOPMENTS IN NATIONAL ENERGY POLICY AND RENEWABLE ENERGY IN THE UNITED STATES Michael Kurniawan (2018123456) University of Cincinnati, 2600 Clifton Ave, Cincinnati, OH 45221, United States kurniaml@mail.uc.edu Abstract Energy policy in the United States continues to undergo dynamic changes, with an increasingly clear direction towards clean energy transition. To reduce carbon emissions, the federal government has enacted various energy laws that form the basis for renewable energy-based development through the National Energy Policy. Based on a review of the literature, ranging from energy regulations to the latest policy reports, this paper traces the development of energy policy in the United States, particularly the steps towards renewable energy transition. The Energy Policy Act of 2005 became an important stepping stone in the formation of new and renewable energy regulations. To maximize the clean energy mix, the government built renewable energy-based power plants, increased the electrification ratio, strengthened the role of institutions such as the U.S. Department of Energy and the Federal Energy Regulatory Commission (FERC), set national targets, and expanded bilateral cooperation at the international level. Keywords: National Energy Policy, renewable energy mix, Energy Policy Act of 2005, U.S. Department of Energy INTRODUCTION The 2014 National Energy Policy affirms that energy management policy in the United States is based on the principles of fairness, sustainability, and environmental friendliness, with the aim of achieving national energy independence and security (Ramadani, 2018). Energy management includes the provision, utilization, and exploitation of energy, the management of strategic reserves, and the conservation of MICHAEL KURNIAWAN 1 Study Case energy resources. The paradigm shift from energy as an export commodity to energy as domestic development capital is expected to increase the contribution of the energy sector to the national economy while accelerating the development of clean energy. As a public policy, the formulation of national energy policy involves various actors (Anggara, 2014). On the government side, roles are carried out by the legislative, executive, judicial, and federal bureaucracy. On the non-government side, involvement comes from the private sector, interest groups, political parties, industry associations, and non-governmental organizations (NGOs). In managing energy resources, the federal government established the U.S. Department of Energy (DOE), which plays a role similar to that of national energy agencies in other countries. Prior to the establishment of the DOE in 1977, the government formed the Federal Energy Administration (FEA) in the early 1970s to formulate energy policy, develop programs, and coordinate the implementation of energy policy. Since the mid-1970s, U.S. energy policy has undergone several important phases. During the 1973 energy crisis, policy was directed toward maintaining economic stability by increasing the role of domestic oil. In the late 1970s, the government imposed fuel subsidies—covering jet fuel, aviation gasoline, diesel, gasoline, and kerosene—to support economic growth. However, this subsidy policy created a fiscal burden and slowed the development of non-fossil energy because alternative energy prices were not competitive. Energy policy then shifted to a demand-side management approach that included intensification, diversification, energy conservation, and energy indexation (Kasharjanto, 2009). During this period, the development of renewable energy began to emerge, marked by the operation of The Geysers — a geothermal power plant in California — in the early 1980s. This facility became one of the important milestones in the utilization of geothermal energy in the United States. MICHAEL KURNIAWAN 2 Study Case METHOD In this paper, the author uses a literature review approach. The literature review was conducted by collecting various sources such as books, scientific journals, policy reports, and news articles relevant to the research theme. The data obtained was then analyzed qualitatively to produce descriptive information (Hadi, 1995). The main sources include reports from the U.S. Department of Energy (DOE), the U.S. Energy Information Administration (EIA), federal legal documents, and academic articles related to energy policy and the transition to renewable energy in the United States. RESULTS AND DISCUSSION National Energy Policy as a Bridge for Renewable Energy Transition As emphasized by Dye (Anggara, 2014), public policy is everything that the government chooses to do or not to do. In the context of energy, the United States has a National Energy Policy designed with the principles of sustainability, equitable access, and environmental protection. This policy aims to strengthen energy security while supporting carbon emission reduction targets. The legal basis for energy management in the US rests on a number of key laws, including the Energy Policy Act (2005), the Clean Air Act, and the Inflation Reduction Act (2022), which provides massive incentives for clean energy development. Through this policy, the federal government is directing the transformation of the national energy mix, expanding the capacity of solar, wind, and geothermal power plants, and supporting electric vehicles. Figure 1. Federal Energy Policy Structure and Clean Energy Roadmap in the United States MICHAEL KURNIAWAN 3 Study Case The energy regulatory structure in the US is supported by various agencies, such as the DOE, Federal Energy Regulatory Commission (FERC), and Environmental Protection Agency (EPA). Meanwhile, the National Renewable Energy Laboratory (NREL) plays a role in research and development. At the state level, each state develops Renewable Portfolio Standards (RPS) that function similarly to regional energy planning, regulating clean energy usage targets according to local conditions. Challenges and Efforts in the Transition to Renewable Energy The development of renewable energy in the United States faces a number of challenges, including: the need for land for solar farms and wind farms, high initial investment costs, limitations in modern transmission network infrastructure, complex licensing processes, and technology supply chain issues. In addition, political resistance in Congress also influences energy policy direction, particularly regarding fossil fuel subsidies and carbon pricing. On the utility side, large electric companies such as Pacific Gas and Electric and Duke Energy face financial pressure in balancing operational costs with the accelerated adoption of clean energy. Until the grid infrastructure is completely upgraded, the penetration of renewable energy into the national electricity system will continue to face obstacles. According to EIA data (2020), 100% of households in the US have access to electricity, but the main challenge is to increase the proportion of clean energy in the national mix. In 2020, renewable energy accounted for only about 12% of total primary energy consumption. The federal target is to achieve 100% clean electricity by 2035 and net-zero emissions by 2050. The federal government is encouraging this transition through tax incentive programs for investments in solar, wind, and energy storage batteries. In addition, the DOE supports biomass co-firing projects in coal-fired power plants and the development of carbon capture and storage (CCS). To expand the use of solar energy, the government launched the Solar Energy Innovation Network program, which targets the use of solar panels in homes, office buildings, and industrial areas. The participation of young people and civil society is also an important element in the energy transition in the US. Movements such as the Sunrise Movement are pushing for the acceleration of the Green New Deal policy and the transition to inclusive clean energy. International cooperation is also being pursued, such as the U.S. commitment to the Paris Agreement, energy research collaboration with the European Union, and joint investments MICHAEL KURNIAWAN 4 Study Case with Canada and Japan in the development of offshore wind and the hydrogen economy. Institutionally, the Secretary of Energy and members of the DOE Advisory Boards play a strategic role in formulating national energy policy. These institutions have a mandate to set energy roadmaps, manage energy emergencies, and oversee the implementation of cross-sector policies. Congress is also discussing a bill related to the Clean Electricity Standard to strengthen clean energy regulations. If passed, this policy will become a more robust legal umbrella for energy transition and provide certainty for investors. CONCLUSION 1. The dynamics of energy policy in the United States continue to change in line with global developments, but the general trend is increasingly towards clean energy transition. The fundamental issue is no longer the affordability of electricity access, but rather the transformation of the energy system towards a low-carbon mix. 2. The efforts of the federal and state governments to accelerate the renewable energy transition can be seen in the construction of solar farms and wind farms in various regions, the formulation of new regulations that provide investment incentives, and the strengthening of international cooperation in the clean energy sector. 3. With a target of 100% clean electricity by 2035 and net-zero emissions by 2050, US energy policy is the main foundation for promoting sustainable development, while also demonstrating a global commitment to addressing climate change. MICHAEL KURNIAWAN 5 Study Case REFERENCE MICHAEL KURNIAWAN 6 Study Case MICHAEL KURNIAWAN 7