This study examines whether the target levels of a state's renewable portfolio standard (RPS) are influenced by target levels in neighboring states, controlling for state‐specific characteristics. Contrary to previous studies, target levels in neighboring states have a positive and statistically significant impact. In addition, the renewable energy potential and transmission capacity within a state, as well as in neighboring states, all have a positive and statistically significant impact. Both a state's unemployment rate and its educational attainment have a positive impact. Furthermore, states with Democratic governors have higher RPS target levels. The results also indicate significant regional variation in RPS target levels.