Michigan Clean Energy Plan

Nick Eshleman

On July 1st, Michigan senators introduced two bills (SB 437 and SB 438) which together comprise the “Michigan Clean Energy Plan.”

SB 438 removes existing mandates on renewables and energy efficiency, as well as replaces the current Net Metering program with a Distributed Generation program, allowing customers to generate up to 110% of their average annual electricity consumption. Additionally, it would require electric providers to offer voluntary green pricing programs.

SB 437 replaces the existing Integrated Resource Plan (IRP) process to allow the Public Service Commission (PSC) more flexibility in regulating utility expansion efforts. It also adds requirements for alternate suppliers to demonstrate that they have enough capacity to meet peak requirements with an added margin, as well as limiting the amount of capacity which can be purchased on wholesale markets. Additionally, any customers currently served by an alternate supplier who choose to return to a utility’s standard rate offering would no longer be allowed to switch back to an alternate supplier.

Together, these bills would allow the market to determine the value of renewable energy by permitting customers to choose whether or not to receive green energy rather than requiring utilities to meet certain renewable levels. It also would permit the PSC to guide utilities on a case-by-case basis rather than applying a blanket policy to all utilities. This could result in a slight cost decrease as utilities shift focus to low-cost green energy options.

In their current state, the bills would maintain the state’s existing 10% energy choice cap.

Both of the bills have been referred to the Committee on Energy and Technology for further analysis and are pending review. The Michigan Senate was on recess from 7/1/15-7/15/15, so we expect an update to be coming shortly on these bills. We will provide updates on the legislation as more information becomes available. The full text of both bills as well as their updated status can be found here (SB 437) and here (SB 438).

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The information in this page is offered only for general informational and educational purposes. It is not offered as and does not constitute legal advice.

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