1 July 2010-- A new market study from IHS said that state-mandated renewable portfolio standards (RPS) would be the most critical driver in determining the pace of the growth of renewables.

“With increasing challenges including low power pricing and uncertain federal policies, escalating RPS demand will define the timing and location of renewables growth across the U.S. over the next few years,” said IHS Renewable Power Research Director Alex Klein.

RPS policies are estimated to require more than 1,000 investor-owned utilities, load-serving entities and competitive retail suppliers to procure renewable power over the next decade, according to the study. Beginning in 2010, significantly escalating RPS demand will create gradually intensifying compliance pressure across the US.

“The next five years will be especially critical as the industry faces its first real test of a significant ramp-up in RPS demand. Before the industry can attempt to reach already lofty longer-term renewable energy goals, utilities and regulators must prove in the next few years that they can reach initial compliance with the RPS targets coming due in many US states,” said Klein.

IHS estimates in the report, US RPS Markets and Utility Strategies: 2010-2025, that cumulative renewables demand across all states with binding RPS policies will grow from an expected 137 TWh in 2010 to 479 TWh by 2025, an increase of approximately 250 percent by 2025. As of June 2010, 31 states and the District of Columbia have passed mandatory RPS policies.

The US renewables market has expanded from a total installed base of 30 GW in 2005 to more than 60 GW at the end of 2009, according to the study.

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