Lower energy costs for homes and businesses—upward of $1,300 a year by 2040—could be coming to Maine thanks to recent legislation, cementing the state’s status among the leaders in the clean energy transition, with a firm commitment to 100% clean energy over the next 15 years.
The bill (LD 1868), passed by the Maine Legislature on June 13, will reduce the state’s reliance on imported fossil fuels by requiring all of Maine’s power to come from renewable energy and other carbon-free electricity sources by 2040. In addition to lower energy costs, the plan will create new jobs and investment in a rapidly growing clean energy industry. Continuing to replace methane gas and oil use in homes, businesses, and vehicles with a growing supply of zero carbon electricity is also a critical component of meeting Maine’s climate goals.
Governor Mills called for accelerating Maine’s clean electricity standard to 100% by 2040 in her 2023 State of the Budget Address when the state was facing extremely high fossil fuel prices following the Russian Invasion of Ukraine, so she is expected to sign the bill into law. It was also a key recommendation in Maine’s 2024 Updated Climate Action Plan (that I helped develop as a member of the Energy Working Group) and the Maine Energy Plan the Governor’s Energy Office (GEO) submitted to the Legislature in January 2025.
In addition to testifying, UCS worked with a broad coalition of groups representing clean energy and environmental advocates, businesses, labor, and other stakeholders to build support for the bill.
What the bill would do
In 2019, Maine passed several major climate and clean energy bills, including increasing its renewable portfolio standard (RPS) to 80% by 2030 and adopting a non-binding goal of 100% renewable electricity by 2050. The current bill would further increase the RPS targets to 90% by 2040. The remaining 10% by 2040 could come from a wide range of low- and zero-carbon technologies, including nuclear power, large existing hydropower projects, and using so-called “clean” fuels like biomethane or hydrogen in thermal plants.
However, an analysis commissioned by the Governor’s Energy Office—Pathways to 2040—showed that renewable energy sources (primarily new wind and solar) would provide nearly all of the electricity generation needed to meet Maine’s 100% clean electricity targets by 2040 because they are cheaper to deploy than these other sources.
The bill goes hand in hand with another bill (LD 1270) recently passed by the legislature, which would replace the Governor’s Energy Office with a cabinet-level Department of Energy Resources that has the responsibility to conduct competitive procurements to ensure Maine’s clean electricity targets are met in a timely and cost-effective fashion.
Increasing clean energy is affordable
The two main drivers for recent electricity cost increases are Maine’s and New England’s over-dependence on imported methane gas for more than half of the region’s electricity and the increase in climate change-fueled extreme weather events. High gas prices, due in large part to the Russian war in Ukraine and decisions by the US and other countries to ban Russian oil and gas imports, increased average residential electricity bills in Maine by $60 per month between 2021 and 2023.
In addition, CMP storm recovery costs totaling $220 million for three storms in 2024 added $10 per month to residential bills.
Recent studies and the results of past RPS procurements provide compelling evidence that accelerating Maine’s clean electricity targets to 100% by 2040 could offset these drivers and help lower overall energy costs:
- The Maine Pathways to 2040 study shows that achieving 100% clean electricity by 2040, combined with widespread electrification of transportation and heating, could reduce electricity prices and average household energy costs by 20 percent, or more than $1,300 per year.
- Maine’s RPS has already saved ratepayers an average of $21.5 million per year between 2011 and 2022, according to a 2024 analysis commissioned by GEO.
- Data from the Maine Public Utilities Commission (PUC) shows that past renewable energy procurements under Maine’s RPS have driven generation costs down, resulting in lower customer electricity bills. The sale of energy from approved procurements played a key role in reducing delivery prices for Central Maine Power (CMP) residential customers by 5.5% and for Versant residential customers by up to 3.8% in 2022, while helping to offset high storm recovery costs seen in 2020 and 2021.
- State RPSs have been a key driver for renewable energy deployment in the United States, contributing to major cost reductions for wind and solar. National average power purchase agreement (PPA) prices for wind fell by nearly 70% between 2009 and 2022, while PPA prices for utility-scale solar projects fell by 87% between 2010 and 2023, according to Lawrence Berkeley National Laboratory (LBNL). State RPSs, combined with long-term procurement policies, have also provided stability and predictability for renewable energy developers that have helped lower the cost of financing projects.
Creating new jobs and economic development
Maine spends more than $4 billion per year on imported fossil fuels. Using this money to invest in energy efficiency and cleaner, homegrown energy sources will create new high-quality jobs and grow Maine’s economy, while increasing energy independence and energy security. For example:
- Maine’s RPS has resulted in over $100 million in direct investment, $900 million in operations and maintenance spending, over 1,000 full-time equivalent (FTE) jobs, and over $1 billion in worker income between 2008 and 2022.
- Maine’s clean energy economy grew more than three times faster than its overall economy between 2016 and 2022. Clean energy jobs in Maine have bounced back from COVID-19 disruptions and are back on the pathway to reach Governor Mills’ goal of supporting 30,000 clean energy jobs by 2030.
Maine is a clean energy leader
Adopting a 100% clean electricity standard by 2040 would solidify Maine’s role as a clean energy leader. As of August 2024, 29 states and the District Columbia have adopted RPSs and CESs, according to LBNL. Sixteen states, including Maine, have RPS targets of at least 50% of retail sales, four states have adopted 100% RPSs, and 16 states have broader 100% CESs that reach these targets between 2040 and 2050. The policy has been so successful that many states, including Maine, have continued to strengthen their targets over the past 20 years.
Maine is also showing that states can continue to make progress in the face of the relentless attacks on clean energy at the federal level. While proposals to slash federal clean energy incentives could raise electricity bills and slow progress in the short-term, continued investment by the states and other countries will continue to drive down the costs of clean energy at the global level. It will also be critical in lowering the mounting costs of climate change and public health impacts from burning fossil fuels.
We applaud the Maine legislature and Governor Mills for passing strong clean energy legislation that recognizes the urgency of the climate crisis and sets an important example for other states to follow.