SEP pictureA State Energy Plan (SEP) is a comprehensive strategy that helps policymakers, state utility regulators, energy suppliers, and consumers strategically plan for a state’s energy future. The goal of an SEP is to act as a roadmap to improve energy affordability, security, and resilience, which in turn, will ultimately lead to a state’s prosperity. As of 2014, thirty-eight states and the District of Columbia have some form of energy planning document to guide statewide energy policy, with another five having begun the process. The Missouri Energy Initiative (MEI) conducted a detailed analysis of SEPs, leading to several conclusions:

  • SEPs have common components and objectivesThe vast majority of states have similar goals in their state energy plans: 35 cite energy efficiency, 34 mention renewable energy, 23 transportation, 16 natural gas, 15 public education, 13 call out innovation and emerging technologies and eight states set goals for oil and petroleum production.
  • SEPs work well if plans are developed and tracked appropriatelyThe key components to a successful plan include stakeholder input, data analysis and consistent tracking. Most SEPs developed before 2014 did not include metrics to identify cost savings, job production or economic growth.
  • States with SEPs have underperformed early, but rebounded quicklyOver time, states with SEPs significantly improved their cost of energy, seeing a decrease in power costs from $12.5cents/kwh to $10.9cents/kwh.
  • States without SEPs saw energy prices increaseWhile states with SEPs saw their economies grow and energy prices decrease, states without SEPs saw energy prices increase.

Moving forward, it is critical that SEPs outline specific action items, in addition to making policy recommendations. State efforts, using metric-based State Energy Plans, can assure greater energy security and affordable, reliable and sustainable energy.

What impacts can SEPs have on a State’s economic development? Which metrics are most important for SEPs to track? If the federal government fails to take significant action on energy policy issues, can the states lead the way?