The Michigan Senate on Thursday adopted a plan to overhaul
the state's energy policy, keeping a 10 percent cap on energy choice and
establishing a 15 percent renewable requirement by 2021.
Senate Energy and Technology Chair Mike Nofs, R-Battle
Creek, has been working on the bills for two years. He said the final product
took into account a lot of viewpoints and was not 100 percent what any one
entity wanted, including him.
"I believe we have crafted a policy that balances a
broad and wide range of interests and addresses the key elements that will
serve our state well for many years to come," Nofs said.
State energy policy was last overhauled in 2008. The changes
in Senate Bills 437 and 438 address
two major areas: renewable energy and energy choice.
Renewable Energy
Michigan's 2008 energy law required utilities to get 10
percent of their energy from renewables by 2015. With that goal met, Democrats
were pushing for a
higher standard going forward.
Republicans initially had shied away from mandates, but the
bills passed Thursday would require utilities to hit a benchmark for 12.5
percent renewable energy in 2021 and get to 15 percent by 2022.
In addition,
there is a goal -- but not a requirement -- to get to 35 percent renewable
energy by 2025.
The bills were praised by clean energy advocates as a step
in the right direction.
"The energy bills represent a step in the right
direction toward reducing dangerous pollution by expanding clean, renewable energy,
but they need improvement. We commend the bipartisan effort to update
Michigan's energy laws." said Jack Schmitt, deputy director of the
Michigan League of Conservation Voters.
"Although the bills increase the renewable energy
standard, there is still much more work to be done to make sure our energy
policy reduces pollution and lowers electricity costs for Michigan
ratepayers."
Energy choice
Currently 10 percent of Michigan's market can use an
alternative electric supplier instead of the utility whose territory they are
in. The issue was hotly debated in the lead-up to the bill's passage.
Groups like Energy Choice Now, Americans for Prosperity and
the Michigan Freedom Fund initially advocated for expanding choice. But
utilities pushed in the other direction, advocating for the elimination of
choice. They say that in an era where they're being required to shutter coal
plants choice affects reliability. If large choice customers come back to their
incumbent utilities the utilities worry about a
shortfall.
The version of the bill that passed kept the 10 percent
energy choice that is in current law, but added requirements that the
alternative suppliers prove they have adequate resources to serve their
customer load. It was a compromise backed by the Michigan Chamber of Commerce,
an influential group in Lansing which had been holding out support.
A change won over the Michigan Chamber of Commerce.
With that in place Republicans were able to pass SB 437
after a long day of caucusing on Thursday. They turned down an amendment from
Rep. Pete MacGregor, R-Rockford, which would have addressed some concerns from
the community advocating energy choice.
Without it groups like Energy Choice now opposed the
Senate's final product.
"All Michigan ratepayers were thrown under the bus
today by Senate leadership, forcing a vote on a bill that will increase costs
on ALL ratepayers," said Energy Choice Now Executive Director Wayne
Kuipers.
"Since the state Senate refused to stand up for
Michigan schools, universities, community colleges, hospitals, faith
communities, grocers and iconic companies like Kellogg, Pfizer and US Steel, we
will join them in looking to Representatives in the Michigan House for relief
from legislation that only benefits Consumers Energy and DTE Energy -- and
their Wall Street investors."
The Michigan Schools Energy Cooperative also opposed the
bills.
"We are shocked and disappointed that so many Michigan
State Senators would choose to support SB 437 which will eliminate
considerable electric choice savings for schools," said spokesman TJ
Bucholz.
"Schools are at the mercy of corporate utilities who
can dictate their costs for electricity - a major budgetary cost center
for schools across Michigan."
The bills passed with bipartisan support, but met opposition
from a small collection of Republicans. SB 437 passed 26-11 and SB 438 passed
27-10.
"Today the Senate had the opportunity to position Michigan
as a leader in green energy technology.
Through a bipartisan effort, we passed
a plan that will move our state forward when it comes to renewable and
efficiency standards and investments. Our economy, environment and health will
improve because of it, ensuring future generations' access to a healthier
environment," said Senate Energy and Technology Minority Vice Chair
Hoon-Yung Hopgood, D-Taylor.
Voting against both bills was Sen. Patrick Colbeck,
R-Canton. He said he thought Michigan's already-high energy rates would
increase under the bills.
"In this case, after all the work that was put into
this legislation there is simply still not enough here to protect ratepayers.
There is not enough to give the people of Michigan relief on their bills or
true consumer choice," Colbeck said.
Both of the state's largest utilities praised the
legislation's passage and urged expediency.
"The vote today by the Michigan Senate is a significant
step forward in efforts to secure the long-term reliability of the state's electric
system, which plays such a vital role in the daily life of Michigan families
and businesses. DTE Energy strongly supports this legislation and urges the
House of Representatives to adopt these bills this year," said DTE Energy
in a statement.
Consumers Energy praised the legislation's passage as well.
"Michigan families and businesses deserve legislative
action which protects electric reliability, ensures energy affordability, and
promotes clean energy and energy waste reduction. As this issue now moves
to the House, we urge our elected Representatives to take timely action on this
vital issue to Michigan's future," said Consumers Energy in a statement.
The bills head next to the House of Representatives, where
House Energy Policy Chair Rep. Aric Nesbitt, R-Lawton, said he looked forward
to continuing work on the bills.
"I look forward to continuing to work with Senator
Nofs, Governor Snyder, and my colleagues in the House to deliver a long-term
energy plan that will provide reliable and affordable energy to Michiganders
for decades to come," he said in a statement.
Gov. Rick Snyder, too, has called for energy changes. He
issued a statement after Senate passage.
"Energy policy has been a major priority this term and
I'm pleased to see this package approved by the Senate with strong bipartisan
support. These policies have the potential to save Michiganders billions of
dollars and make our state's energy future much brighter. I look forward to
working with our partners in the House to complete this work before the end of
the year," Snyder said.
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