Understanding and Upgrading Michigan's Clean Energy Policy

Whether you're a legislator, advocate, or following from home, we can all agree the energy debate in Michigan has seen a lively few weeks. With positions shifting and hearings abruptly starting and stopping, we're all left scratching our heads trying to make sense of what happened. Now is the time to get our bearings with legislators on break for hunting and Thanksgiving. It marks a time for digesting not only turkey, but the many clean energy options before the state. This two week window leading up to the December legislative push in the House and Senate is critical for understanding what made it out of committee and what improvements still remain.

If ever a process was both drawn out and rushed it was November fifth's adoption of amendments and substitutions for House bills 4297, 4298, and 4575. It took two days of calling the committee into session and multiple breaks before members were finally corralled together for five hours of confused paper shuffling, a one-sided piece of testimony without any rebuttal, and ultimately voting. All three bills did eventually make it out of the House Energy and Technology Committee.

By the end, negotiations brought clean energy back into a position of being added not eliminated, but as always the devil is in the details. Here's a breakdown of what passed and how we need to make it better:

Renewable Energy and Waste Reduction Goal

• Understanding: An amendment passed for a goal of not less than 30% electric energy coming from energy waste reduction and renewable energy by 2025.
• Upgrading: We need a way to hold utilities to these numbers. A goal that only reaches the low end of the Governor's vision does not provide the certainty that Michigan needs. Additionally, no specifics exist yet for what would happen if that 30% was not met, making it sound more dream than reality. Looking closer at the numbers, a 30% goal is only a 5% increase in renewables over the next ten years, with the rest coming from projected energy waste reduction. We can do more, and do it faster. We should pursue a floor of 1.5% energy waste reduction per year--with incentives kicking in afterwards, and should hold utilities accountable to a combined 40% of energy waste reduction and renewables by 2025.

Renewable Definition

• Understanding: An amendment passed removing the burning of petcoke, hazardous waste, coal waste, and scrap tires from the definition of renewable energy.
• Upgrading: The burning of coal, wood, biomass, industrial waste, and solid waste are still included however making it difficult to be truly considered renewable. We need to tighten the definition to focus on solar, wind, and biomasses whose short term net emissions (over a period of 1 - 3 years) are proven to be less than fossil fuels. Additionally, the following technologies and resources often claim that they are renewable, but in fact, they rely on dirty fossil fuel energy or create other pollution hazards during the process of energy extraction:
  • Coal waste from coal mining
  • Methane gas from coal mines
  • Waste-to-Energy (WTE) facilities, i.e. waste incineration
  • "Waste heat" recovery from fossil fuel

These are not renewable energy sources and are not good alternatives to fossil fuels.

Cost Allocation

• Understanding: Cost allocation tells utilities how to divide up rates and who has to pay what portion. The house bill passed a cost allocation structure that would override rulings by the public service commission who is tasked with determining what is reasonable and just for the state.
• Upgrading: This shift has been tried in at least two rate cases and has been denied repeatedly. If we adopt the new method that was voted out of committee, we will unfairly and unreasonably shift the cost burden from industrial customers to residential customers. We need to stick to the cost allocation that the public service commission ordered.

This is just the beginning. This collection of House bills is in no way complete. More edits need to be made especially when it comes to a proposed revamping of an energy planning process called an Integrated Resource Plan or IRP. And, don't forget about the two bills on the Senate side. Though much of the commotion is on the House side right now these the Senate bills are alive and well and have the potential to move. All of these bills could have a profound impact on Michigan's energy future and we want the impact to be positive. Michiganders have an opportunity to use the coming weeks to urge their representatives and senators to pass a final set of bills that not only supports clean energy provisions, but puts teeth in them.