Researchers at the Massachusetts Institute of Technology (MIT) have found that renewable portfolio standards (RPS) and utility-scale renewables are not associated with higher residential electricity prices in the United States, while rooftop solar is associated with higher prices.

Fischer J. Espiritu Argosino and Christopher R. Knittel of the MIT Center for Energy and Environmental Policy Research (CEEPR) built a state-utility panel covering 1998 to 2023. It links residential prices, RPS stringency, generation mixes and utility spending, using data from the US Energy Information Administration (EIA), the Federal Energy Regulatory Commission (FERC) and Lawrence Berkeley National Laboratory (LBNL).

“Using a two way fixed effects regression model that controls for unobserved differences across years and between states, we find that RPSs and utility scale renewables are not associated with higher residential electricity prices,” the researchers said in a summary of the paper. “Instead, RPSs have virtually zero impact on prices and utility scale renewables are modestly associated with lower prices; in particular, utility-scale solar is strongly linked with lower prices.”

Based on the paper’s regression coefficients, which measure generation shares relative to coal, a 10-percentage-point rise in utility-scale solar’s share of generation is associated with residential prices just over 8% lower. A 5-percentage-point rise in rooftop solar’s share is associated with prices roughly 16% higher. The authors cautioned that the results are correlations and said further work will apply “more rigorous econometric techniques to further strengthen the causal interpretation of these estimates.”

“One explanation is that large solar plants may reduce network congestion and place downward pressure on overall generation costs because they do not require fuel inputs,” the researchers said.

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