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New wind energy contracts great for regionPrint

Clean Energy | June 27, 2016 | By Jim Dulzo

**This column originally appeared in the June 23, 2016, edition of the Traverse City Record-Eagle

Last week was a good one for clean, renewable energy in our town. Traverse City Light & Power signed a contract for more power from a planned wind farm in the Thumb. The contract adds 3.6 megawatts of wind power to the public utility’s energy supply—enough to power about 1,000 homes for a year.

There’s more good news.

First, the contract price was about 5 cents per kilowatt-hour over 20 years—more than a 50 percent drop in wind prices since TCL&P signed its first 10 MW contract with Stony Corners Wind Farm in McBain in 2010. It also blows away all other new generation prices, with the exception of natural gas-fired power plants when gas prices are at rock bottom, but the difference is just fractions of a cent. When natural gas prices rise, the wind contract will hedge against customer rate increases.

Second, such low wind prices are now common even in only moderately windy states like Michigan.

And third, it means TCL&P will get about 15 percent of its power from renewables—14 percent from wind and 1 percent from a landfill gas-fueled generator. Right now, TCL&P slightly exceeds the state’s 10 percent renewables standard, mostly thanks to Stony Corners.

Just down the road, Cherryland Electric Cooperative will soon get 30 percent of its power from wind, and for the same reason: It’s now so cheap. Cherryland will pay about 6 cents for its contract—a steal when they signed up more than a year ago, and still a very good deal.

The best is still to come, though: Current research, combined with spectacular renewables price drops, indicates that achieving 100 percent renewables by 2050 is very doable technically and economically.

So, hooray for TCL&P for buying more wind through the Michigan Public Power Agency, which signed up all 18 of its members. And hooray for Tim Werner and other solar leaders on the TCL&P Board and Tim Arends and TCL&P staff for inviting the agency to speak and for starting the board conversation about solar power. Its price is falling as rapidly as wind power’s, and it’s just a few cents away from parity with fossil fuels.

Many companies get all of this. That’s why, across America and around Michigan, they are telling utilities that they want more clean power, something their market research tells them their customers want. Citizen groups—including the Groundwork Center for Resilient Communities, the Northern Michigan Environmental Action Council, the Michigan Environmental Council, and the Michigan League of Conservation voters—are contacting local business friends and asking them to sign a letter urging TCL&P to add even more renewables.  

In fact, MPPA officials told the TCL&P board that one motivation for forming the wind contract was that so many of their member utilities tell them commercial customers are clamoring for more clean energy. That, they said, is why the wind contract is completely sold and that, if it were available, many MPPA members would buy even more.

Jim Dulzo is the Groundwork Center for Resilient Communities’ senior energy policy specialist. Reach him at jimdulzo@groundworkcenter.org