2016 Get Local Party

Michigan energy legislation takes promising first step

November 22, 2016 | |

But bills in Lansing should prioritize local solar jobs

Vicki Olsen is a ray of sunlight amidst November’s cloudy skies. The Long Lake resident is enthusiastic, motivated, and able to turn bright ideas into reality. She and her husband Craig moved to Grand Traverse County from Pennsylvania five years ago and are cashing in on northwest Michigan’s growing clean energy economy. But energy legislation currently working its way through the state government in Lansing will have a huge impact on Vicki and thousands of Michiganders like her.

Two years ago, Vicki installed solar panels on her ranch house. The ambitious move cost $12,000 — a stretch for their limited budget — but under her contract with Cherryland Electric, she’ll recoup her investment in about 10 years. After that she’ll harvest the sun’s rays for pure profit. For Vicki, who is an Outings Leader at the local Sierra Club chapter, the solar investment was as much about protecting the environment as it was about padding the bottom line.

Last year, after taking Northwestern Michigan College’s solar training course, Vicki was ready to help other homeowners take advantage of the sun’s rays.

Enter Allan O’Shea of CBS Solar — a family-run business out of Copemish. Allan learned that Vicki was looking for work, and that she was already engaged in the local renewable energy community. With demand for local solar booming, he hired her on the spot. She now spends significant time meeting with local residents and neighbors around northwest Michigan. She works with them to design solar systems that can save them money, make them more resilient and energy-independent, and simultaneously reduce fossil fuel emissions.

However, the future growth of the solar industry faces threats in the legislature, and that will impact people like Vicki and companies like CBS. Earlier this month, the Michigan Senate passed Senate Bills 437 and 438 – which could have sweeping effects on Michigan’s energy economy over the next several decades. The bills now move to the House where a vote could come by the end of 2016.

On the upside, these energy bills require more renewables. Under a 2008 energy law, the state’s large utilities were required to generate 10 percent of their load from renewables by 2015. They surpassed that target last year, mostly through wind. According to Crain’s Detroit Business, the benefits were widespread.

Under the new Senate bill, utilities would be required to generate 15 percent of their electricity from renewable sources by 2021 and 35 percent by 2035.

Room for improvement

But this legislation could do more. These standards still leave us trailing behind other states with renewable targets. Michigan will reach 15 percent by 2021 – ranking it 12th nationwide in a fast growing industry. Compare that to New York and California, which will reach 50 percent by 2030. Even fellow Midwestern state Minnesota’s utility Xcel Energy, will be 30 percent renewable by 2020.

More concerning is that the bills contain provisions that could cripple the type of local energy economic development that CBS and Vicki are doing. Specifically, the new senate bills allow for a grid charge — to be determined by the Michigan Public Service Commission — that could significantly reduce the amount that DTE and Consumers will pay to folks who have solar arrays.

In real world terms, customers who pay the upfront cost to install solar may need 25-30 years to recoup their investment, rather than the 10 years that Vicki expects. This could effectively put solar out of reach for many folks.

This legislation threatens to stop in its tracks a growing residential solar industry that is training and employing hundreds of roofers, electricians, permitting officials and general contractors from Ann Arbor to Lansing, Grand Rapids to Traverse City, and Saginaw to Copemish.

Keeping it local

Our local utilities, Traverse City Light & Power (TCLP) and Cherryland Electric Cooperative, are great examples of utilities embracing local solar. At this time last year, both had proposed changes to their net metering programs that were similar to SB 437 and 438. But after hearing pushback from customers, the utilities rethought their approaches. On the renewables front, Cherryland is likely to hit 30 percent and TCLP will likely achieve 15 percent by next year.

On the net metering front, TCLP agreed to maintain its full net metering rates and set a cap so that if solar grew too fast, the company could exercise control. Meanwhile, Cherryland now offers several attractive options. The Traverse City utilities have been transparent and visionary. They and the communities they serve are working together to capitalize on the tremendous local value and opportunities of transitioning to solar. In the case of Vicki Olsen and CBS Solar, the results are bright.

But community conversations like these are difficult to foster at the state level. Solar advocates fear that SB 437 and SB 438 — which were largely drafted and lobbied by DTE and Consumers Energy without much citizen input — may now put large energy projects in the hands of a couple giant developers instead of sharing that wealth with the citizens of Michigan. Instead, why not take a grassroots approach to solar, installing it on tens of thousands of rooftops, and employing hundreds of people each year?

If we want voters and energy consumers to come together and turn their political yard signs into solar arrays installed by their neighbors, we need to give Michigan residents the resources to create a truly local industry.

State lawmakers should embrace the new provisions in SB 437 and 438 but make them stronger for people like Vicki back in their home communities. What better way to create jobs in both rural and urban Michigan.

About The Author

Dan Worth is the Clean Energy Policy Specialist at the Groundwork Center for Resilient Communities. Reach him at [email protected]

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