Partisan Climate Action, Utility Interests, and Policy Choice in the U.S. Power Sector

Witson Peña Tello ()
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Witson Peña Tello: Observatory of Analysis and Evaluation of Public Policies and the Research Group on Governments and Markets, Universitat de Barcelona, Spain.

No 202524, IREA Working Papers from University of Barcelona, Research Institute of Applied Economics

Abstract: This paper investigates how U.S. gubernatorial partisanship and electric utility interests jointly shape the adoption and stringency of three widely used electricity-sector climate policies: greenhouse gas cap-and-trade, emissions standards, and renewable portfolio standards. Using panel data for 48 states over 29 years, this study applies difference-indifferences and regression discontinuity designs that exploit within-state partisan alternation and quasi-random variation from close gubernatorial elections. The results indicate that Democratic governorships associate with higher probabilities of policy adoption and greater stringency than Republican ones. However, these partisan effects attenuate in states with fossil-intensive utility capacity and strengthen in renewable-rich states, particularly for discretionary and mandatory renewable portfolio standards. This work extends the empirical political economy literature by comparing instrument choice and stringency across three major electricity-sector climate policies and by evaluating how utility sector composition and reelection incentives moderate or amplify partisan influence. The findings highlight that electricity-sector decarbonization strategies need to account for both environmental externalities and the local political-economic conditions that shape feasible policy options.

Keywords: Climate Policies; Political Parties; Electric Utility Interests. JEL classification: D72; L94; Q42; Q48; Q54. (search for similar items in EconPapers)
Pages: 27 pages
Date: 2025-12
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Persistent link: https://EconPapers.repec.org/RePEc:ira:wpaper:202524

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