What is a Renewable Portfolio Standard (RPS)? Sustainability Simplified Glossary

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A Renewable Portfolio Standard (RPS) is a regulatory policy requiring electric utilities and other retail electric providers to supply a specified minimum percentage (or absolute amount) of customer demand with eligible sources of renewable electricity. 

State or national authorities can set these standards. Many states have adopted RPS requirements due to their efficient, cost-effective, market-based approach to achieving renewable electricity policy objectives. The key features of a Renewable Portfolio Standard include: 

These policies aim to foster the development of renewable energy sources, reduce greenhouse gas emissions, and promote energy independence. They create a market demand for renewable energy, which, in turn, encourages investment in renewable energy technologies and projects. As a result, RPS policies drive renewable energy sector growth, offering a predictable market for renewable energy generation.

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