Abstract
This study evaluates the effectiveness of state-level policies on renewable energy (RE) generation capacity in the United States. Using a comprehensive panel dataset of 3017 counties from 2009 to 2019, we account for county-level variations in policy implementation and employ spatial panel models to capture spillover effects among neighboring counties. Our findings reveal that Renewable Portfolio Standards, expressed as percentage targets, significantly increase RE generation capacity across all sources. Property tax reductions boost solar and wind capacity but do not affect hydro and geothermal energy. In contrast, Energy Efficiency Resource Standards are negatively associated with hydro and geothermal capacity. Other policies, such as the Mandatory Green Power Option, sales tax incentives, and market deregulation, have shown no significant linkage with RE capacity. The results further indicate that spatial spillover effects are more pronounced for solar and wind generation capacity than for hydro and geothermal generation capacity. These findings highlight the need for tailored policies that consider the unique characteristics of each renewable energy source and account for regional interdependence in policy design.