States Are Plugging into Experimental Electricity Policy to Find Cost-Saving Success
The energy affordability crisis is hitting American communities hard, and nowhere is the pressure more acute than at the state and local level. Leaders are responding to the needs of their constituents while navigating a tangle of barriers—ranging from project development hurdles to political and social constraints. Tackling these challenges requires a holistic approach, as addressing one barrier—whether it’s clean energy permitting, financing, or supply chains—without the others won’t work.
To tune into the action on the ground, FAS convened practitioners, state and local officials, advocates, and policy experts to discuss what it will actually take to deploy clean energy faster, modernize electricity systems, and lower costs for households.
We heard about lots of efforts underway in city halls and state capitals across the country, many of which are aligned with our recently released Clean Energy for Local and State Governments (CELS) playbook and other recent recommendations for capacity support and innovation at the state and local level. One message came through clearly: while barriers are real, so are the opportunities. Across the conversation, participants identified practical, high-impact levers that states and cities can use right now.
The ideas were so good we wanted to share them far and wide—read below for more.
Building capacity for ambition by maximizing what we already have
States and cities have good ideas – and motivation – to bring down electricity prices. But the reality is more complicated. Institutional and political constraints strongly shape the pace and scope of their desired reforms. State and local governments face legal and administrative limitations, including state-level restrictions related to financing, building codes, and utility authority. Many cities (and states!) operate with limited staff and budgetary resources. Lack of capacity makes it difficult to implement ambitious energy policies – even when there’s political will.
Expanding this capacity is a path to better government and lower prices—and the first step towards rebuilding trust in government as a vehicle to do big things. Resources are a not-insignificant part of being able to do those big things, but of course, it’s not always possible to hire whole new teams of staff or stand up new programs. It’s also not always necessary!
We heard from state and local leaders across the county about how they’re getting creative with existing resources to carry out their promises to constituents. Permitting processes, for example, are an oft-cited barrier to increasing energy supply and driving down electricity prices. With little meaningful change at the federal level, states are looking for ways to improve their own permitting pipelines.
Pennsylvania has led on this front by clarifying and centralizing permitting authority across agencies, establishing clear timelines and accountability for permit reviews, and digitalizing processes to cut down on administrative burden. Making progress didn’t require building whole new teams or throwing out environmental protections—instead, Pennsylvania made the permitting process clearer, more consistent, and more predictable to increase certainty for solar developers without increasing impact.
Identifying capacity investments with a high return like these are useful – not just for improving delivery, but getting near-term wins that governments can point to to build trust with constituents and provide proof of concept. The think tank and advocacy community can help by identifying creative solutions to increase government capacity at low cost and better leverage existing capacity.
PUCs, PUCs, PUCs!
We heard a lot of anecdotes about increased attention on Public Utility Commissions (PUCs) given how hard utility bills are hitting constituents.
Most critical decisions affecting utility bills occur in regulatory proceedings—rate cases and planning dockets in front of PUCs. However, these processes are often technically complex and dominated by utilities, which typically have significantly more resources and information than governments or community members. States and local governments identified help engaging with PUCs—through more capacity and increased data tranparency—as a key opportunity to reduce energy costs and make other clean energy and affordability programs work.
Capacity at PUCs themselves also came up as a major barrier and opportunity. States can appropriate additional funds to PUCs to help them access adequate staff and technical expertise, or can establish intervenor compensation funds to help level the playing field in rate cases. Ann Arbor, Michigan reported saving ratepayers over $1 billion through interventions in electric and gas cases, in part by investing in legal and technical support for intervenors. Municipalities in Wisconsin, organized under the Wisconsin Local Government Climate Coalition, also banded together to intervene before the Public Service Commission and advocate collectively.
The advocacy community can help as well. By training intervenors, pressuring utilities to increase transparency or provide additional, and supporting local and state governments’ ability to intervene in rate cases, they can help provide key perspectives and evidence to inform PUC decisionmaking.
Mind the (financing) gap
Unsurprisingly, state leaders identified the cliff in federal financial support for projects as a reason it is harder to implement state and local clean energy programs.
Getting creative with financing can help state governments stretch existing funds or partner with peers or community organizations. States can use tools like revolving loan funds to support pre-development and construction financing, pooled lending authorities, or loan guarantees to reduce interest rates. Mechanisms that merge public and private financing capacities or improve transparency and certainty around project development can help public dollars go further.
States and local governments are hungry for help using creative financing mechanisms. For example, how can municipalities play in using public debt to finance projects and reduce costs? This is a major place where the advocacy community can help.
Don’t be afraid to experiment!
Policymakers were excited about experimenting with new policies that emphasize affordability, resilience, and economic benefits and in turn broaden political support for clean energy initiatives. One example discussed was the Utah Community Clean Energy Program, a first-of-its-kind opt-out clean energy procurement model created through collaboration between 19 Utah communities and Rocky Mountain Power. Approved by the Utah Public Service Commission in March 2026, the program allows participating customers to support new utility-scale clean energy resources through a modest monthly charge, with income-qualified households eligible to participate for free and all customers able to opt out at any time.
This work is already happening and not just in the areas highlighted here. Creating structures for policymakers to share successes and creative ideas can help multiply wins across the country. Collaboration can also support officials working in politically or institutionally constrained environments, where proof of concept and policy examples can help build momentum. The Metropolitan Washington Council of Governments offers one example of how regional institutions can pool resources to accelerate local action. Through its regional environment fund, the COG supports the design and coordination of climate initiatives that signal aggregate demand across members, like fleet electrification or emissions reductions. It then follows up with implementation guides, technical assistance, and best practices that local governments can adapt.
There is a lot of momentum in utility operation and regulation to reexamine the way we’ve always done things. Political will from state or local leadership can help question old ideas and advance new ideas to benefit the public. Combined with successful implementation experiments above, further experimentation and research can drive progress and support for state-level climate leadership.
To tune into the action on the ground, we convened practitioners, state and local officials, advocates, and policy experts to discuss what it will actually take to deploy clean energy faster, modernize electricity systems, and lower costs for households.
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