Energy policy involves setting out guidelines, objectives, and regulations to manage the production, distribution, and consumption of energy. It must strike a balance between competing interests and priorities.
Nations often develop energy policies tailored to their national interests, which might include concerns with decarbonization, system reliability, resource development, technology export potential or economic costs.
The U.S. Energy Sector
Energy is essential to modern life and the United States is one of the world’s leading producers and exporters of oil and liquefied natural gas. The industry creates jobs while helping drive economic expansion; additionally it plays an essential role in protecting the environment by decreasing greenhouse gas emissions.
Governments play many roles in energy policy, from regulating markets and setting prices, to offering incentives or subsidies such as tax credits for electric vehicles. Furthermore, governments may set goals or targets related to renewable energy production or greenhouse gas reduction.
Public opinion can have an enormous influence on energy policy, with certain segments of society opposing offshore oil drilling, nuclear power or exploration in ANWR while others support such activities. Events like oil spills or Fukushima disaster can bring specific issues into focus and lead to changes in political momentum; values and ideology also often determine people’s responses toward various energy options.
The U.S. Electricity Sector
Energy infrastructure in the US drives its economy, providing electricity for lighting, heating, cooling, refrigeration, manufacturing, vehicle charging and operating appliances, computers and electronic devices in homes and businesses alike. Over 11,000 utility-scale power plants generate this power which travels via more than 160,000 miles of high voltage lines to households and businesses in need.
America no longer generates electricity like it did two decades ago when natural gas began overtaking coal as its primary source. Now, each state is at different stages in their transition toward cleaner energies; some states making progress faster than others.
American electricity grid isn’t one large entity. Instead, the country is separated into three physical systems and various balancing authorities (such as Eastern Interconnection, Western Interconnection and ERCOT) that operate mostly independently but occasionally exchange power among themselves with limited exchanges of power between them. Planning transmission projects that cross these balancing authorities involves lengthy and expensive processes with many points of veto along the way.
The U.S. Fossil Fuel Sector
Governments can influence energy markets through setting prices, regulating output, providing incentives and subsidies, such as tax credits, grants and low-interest loans. Fossil fuel subsidies are contentious as they mask their true costs – climate change impacts, public health impacts and environmental degradation are just some examples; governments should only support fossil fuel production when consistent with an overarching policy that takes these factors into consideration.
The United States boasts extensive coal, oil, and natural gas resources that are managed by federal agencies through various regulatory functions, including maintaining emergency petroleum reserves and overseeing their development responsibly. Governments may promote energy conservation through public education campaigns to encourage lifestyle changes that reduce energy use – such as living in smaller dwellings or using public transportation – or by supporting investments that make buildings and appliances more energy-efficient or supporting research into technologies to make fossil fuels cleaner and greener.
The U.S. Renewable Energy Sector
Governments play an essential role in creating energy policies that promote sustainable practices, including regulating markets and offering financial incentives or subsidies, conducting research and development, conducting studies between stakeholders, or creating institutions that facilitate collaborations among them.
Rising numbers of communities are turning to renewable energy sources – from large offshore wind farms to solar panels on homes that feed electricity back into the grid – but high project costs and other challenges are stymying this advancement.
Most Americans favor using both fossil fuels and renewables in combination, although there remains disagreement among Americans on whether the United States should transition away entirely from fossil fuels altogether: Democratic voters differ significantly on this question from each other as do men and women as well as millennials and seniors. Many states have taken measures to curb greenhouse gas emissions through policies like clean electricity standards, improved building energy efficiency and zero emission vehicle policies – these state initiatives together with federal measures will help the country meet its clean energy goals more easily.