Setting the Stage for Energy Justice: Developing a State Regulatory Environment Typology for Utility Planning

• In Event: Dimensions of Justice in the U.S. Clean Energy Transition

Abstract

As the United States progresses its transition toward decarbonization, the pursuit of energy justice—encompassing distributional, procedural, and recognition-based dimensions—has become increasingly urgent. Investor-Owned Utilities (IOUs), which serve nearly three-quarters of U.S. electricity customers, play a central role in shaping the outcomes of this transition through long-term planning processes such as Integrated Resource Planning (IRP). While much attention has been paid to individual policies like Renewable Portfolio Standards or energy efficiency mandates, there remains a significant gap in our understanding of how broader state regulatory environments—composed of institutional, political, and policy elements—shape utility behavior and equity outcomes.

This study develops a theoretically informed, data-driven, multi-dimensional typology of state regulatory environments to illuminate how variation in governance may influence utility planning and, ultimately, energy justice. Drawing on data from all 50 U.S. states, the analysis incorporates indicators across six core dimensions: state government ideology, electricity market structure, Public Utility Commission (PUC) characteristics, clean energy and efficiency mandates, equity-focused governance mechanisms, and IRP requirements. Key data sources include the Database of State Incentives for Renewables & Efficiency (DSIRE), state statutes and commission websites, the American Council for an Energy-Efficient Economy (ACEEE), structured regulatory data from tools like Insight Engine, and peer-reviewed indices such as Berry et al.'s Government Ideology Index.

Using K-means clustering guided by the elbow method, the study identifies four distinct clusters of state regulatory environments. Discriminant analysis and machine learning methods—including decision trees, random forests, and permutation importance—are then employed to validate the cluster solution and assess which factors most powerfully differentiate regulatory contexts. Clean energy policy commitment, equitable governance mechanisms, and state political ideology emerge as the most significant variables driving classification, while factors like IRP requirements and bipartisan commission structures play more limited explanatory roles.

The resulting typology provides a novel framework for understanding how combinations of institutional features condition IOUs’ responsiveness to energy justice goals. It moves beyond linear rankings of regulatory strength to identify hybrid models—such as high-capacity, equity-forward states versus minimalist, market-oriented regimes—offering a richer depiction of governance diversity in the energy sector. These findings contribute to theory-building in energy justice and regulatory governance by emphasizing the importance of institutional configurations rather than isolated policy tools.

By establishing a typology that is both empirically grounded and theoretically informed, this research offers practical value to scholars, regulators, and advocates. It enables more strategic case selection, supports comparative research, and serves as a diagnostic tool for evaluating the enabling conditions for equitable energy transitions. Ultimately, the study lays the foundation for future work linking regulatory environments to observed disparities in affordability, clean energy access, and participatory inclusion.

Author

• Mohsen Fatemi, University of Kansas
  Presenting Author