A transformative move to clean energy seemed right around the corner in 2021: utility-scale solar and battery storage set annual installation records , and the passage of the Infrastructure Investment and Jobs Acts (IIJA) allocated $73 billion toward building new power lines, rebuilding America's electric grids, and expanding clean energy access.
But while the industry worked to make clean energy a priority last year, greenhouse gas emissions rebounded from a pandemic-fueled drop. As a result, the U.S. remains some distance from achieving its 2030 GHG reduction target.
With these developments in mind, what does the future of clean energy herald for utilities and electric service providers? In our quarterly poll, we asked industry executives what their biggest challenges were in reaching their clean energy goals—and whether they planned to make use of new IIJA funding.
Aggressive targets for decarbonization abound. But when it comes to construction of long-distance transmission lines or eliminating inequities in availability of clean energy resources, utility leaders still face regulatory hurdles.
So, it tracks that, when asked to name the biggest obstacle to reaching their clean energy targets, a majority (28%) of respondents cited legislation and/or regulatory and state policy challenges. Respondents also cited funding and workforce hurdles (20% each), suggesting that despite recent progress, there hasn’t been enough of a sea change to facilitate a clean transition for utilities.
The new electricity-grid funding in IIJA has been billed as unprecedented—and yet, six in 10 executives in our survey say they don’t plan to leverage it and 28% have not decided. (Note: Our poll was conducted prior to some utility regulators now requiring that utilities leverage IIJA funding as part of the regulatory capital expenditures approval process).
With so much money on the table, it is unlikely that industry leaders on the fence are simply deliberating. Rather, they may not know where to begin when it comes to navigating the complex proposal, application, documentation, and approval process for certain funds.
Amid rapid changes in the provision of electric services, organizations will need to make significant investments in a range of new technologies and infrastructure. Financial support from legislation like the IIJA can play a vital role—and utilities that are unsure about funding should evaluate how it might help them reach their decarbonization targets and regulatory requirements.
See what all industries said about inflation, the war on talent, and more—and learn about the poll respondents—in our main Quarterly Executive Poll.