Energy policy refers to a set of government decisions that outline long-term goals in energy usage and production. These may focus on decarbonization, system reliability, resource diversification, technology export potential or economic costs.
These decisions must take into account various competing priorities, such as safeguarding iconic landscapes from development; compensating taxpayers fairly for energy extraction activities; and setting air quality standards.
Policy Objectives
Governments at all levels – local, state, national, and international–adopt energy policies that regulate production and consumption. Such policies can have major ramifications on climate change mitigation strategies, energy security initiatives, environmental sustainability efforts, and overall wellbeing.
Reducing the impact of energy production and consumption requires both short- and long-term strategies. Some policy tools available for managing this issue include mandating best available technologies, regulating air pollution emissions, setting energy efficiency standards, imposing a carbon price or cap-and-trade system and offering financial incentives for renewables, efficiency measures, or low carbon fuels.
Other policies emphasize energy access for all, developing new energy technology and infrastructure development, and stimulating economic growth. Synapse supports these efforts by analyzing environmental compliance forecasts and assumptions in major regulatory filings; estimating impacts of energy programs on criteria pollutants as well as public health and environmental justice populations; conducting research to identify benefits of clean energy investments; as well as conducting research to identify their benefits for our clients’ goals of climate, energy and environmental security. Our clients trust in our expertise to meet their climate, energy and environmental security goals.
Fossil Fuels
Fossil fuels–coal, oil, and natural gas–are nonrenewable resources that contribute to climate change, air pollution and other environmental problems when burned for energy. Countries often adopt policies regarding fossil fuel use that reflect national interests such as decarbonization, system reliability, diversification of resources, technology export potential or economic costs.
Governments devise and implement energy policy instruments to regulate the development, production and use of fossil fuels by regulating energy markets, setting carbon prices or offering subsidies and incentives. These tools impact decisions made by households, businesses and institutions regarding which form of energy to power their buildings, vehicles or industry assets.
Public sentiment plays an integral part in shaping energy policy, often driving discussions regarding offshore drilling and exploration in Alaska National Wildlife Refuge (ANWR). Major energy accidents like the Santa Barbara oil spill or Fukushima nuclear disaster can bring attention to risks associated with certain energy options and cause governments to reconsider their energy plans.
Energy Efficiency
Today’s inefficient energy system wastes two-thirds of global energy production, leading to climate, health, and economic damage that further deepens inequalities. A shift toward cleaner renewables, batteries, electric vehicles, buildings, factories and systems could cut emissions by as much as 40% if implemented immediately.
Energy efficiency policies play a pivotal role in driving this progress by lowering costs associated with efficiency measures and making them accessible to all. Examples of such policies include policies to lower bills for households, businesses and institutions alike; improve transparency, affordability, accessibility of energy efficiency products for consumers; as well as supporting systemic efficiency measures such as compact urban form.
Governments can set clear directives for utilities on the importance of energy efficiency by setting energy savings targets such as Energy Efficiency Resource Standards (EERS). This approach has become widespread, and these policies have proven successful at driving incremental energy savings from regulated utilities; however, more work needs to be done in unlocking energy efficiency’s full potential.
Energy Access
Energy access is one of the key development indicators, affecting household welfare and quality of life in developing countries. Governments place great emphasis on this indicator. There can be diverging views on what exactly constitutes electricity access – whether households using solar panels for lighting and mobile-phone charging are considered “electrified”.
The International Energy Agency (IEA) defines energy access as household access to affordable, reliable electricity and clean cooking fuels at reasonable costs. We maintain databases describing levels of access in each country or region – this serves as the basis of our WEO projections of future access levels.
We’re working tirelessly to expand electricity access for developing countries by supporting grid investments and helping develop off-grid solutions. Last-mile access remains the best value per kWh option for most households or local businesses connecting through grid densification or extension; off-grid solutions may prove more economical in rural communities with lower population densities than last mile connections.