Power companies in Michigan on track to hit 10% renewable energy goal by 2015

Posted on February 18, 2014

The Michigan Public Service Commission’s fourth annual report released Tuesday confirmed that the state’s utility companies have met their renewable-energy production goals for 2012 and are expected to reach 6.9 percent this year. Utilities must reach 10 percent by 2015.

“The year 2012 marked the first time that Michigan utilities were mandated to meet an interim compliance requirement, and all of them succeeded,” said John Quackenbush, chairman of the Public Service Commission, in a statement.

“Progress toward Michigan’s 10-percent-by-2015 renewable-energy standard is going smoothly, and since the standard has been in effect, over 1,100 megawatts of new renewable-energy projects have become commercially operational.”

Under Public Act 295 of 2008, the PSC is required to issue an annual report by Feb. 15 for the state Legislature that summarizes progress utility companies are making toward producing 10 percent of their electric energy from renewable sources.

Last December, Gov. Rick Snyder called for lower electric rates, and improved energy efficiency, and suggested he might support a doubling of the state’s 10 percent renewable-energy production to 20 percent by 2025.

Legislative committees are expected to hold hearings this year on expanding the renewable-energy portfolio standards and on customer choice. For example, Rep. Mike Shirkey, R-Clarklake, introduced House Bill 5184 that would eliminate the 10 percent cap on electric choice and open the state’s electricity market to full competition.

The PSC report also highlighted the following points:

  • Through 2013, Michigan’s renewable energy standard has resulted in the development of 1,182 megawatts of new renewable-energy projects.
  • The weighted average cost of all renewable-energy technologies is $78.39 per megawatt-hour. This is at least 30 percent less than the projected cost of electricity from a new coal-fired power plant.
  • The most recent contracts approved by the commission for new wind capacity have comparable costs in the $50 to $59 per megawatt range, which is about half of the costs of the first few renewable-energy contracts approved in 2009 and 2010.
  • A total incremental cost of $1.6 billion was spent on renewable energy in Michigan from 2009 through 2012.
  • All Michigan electric providers — except Detroit Public Lighting — are on pace to meet interim targets, as well as the 10-percent-by-2015 target. The commission suspended all of DPL’s renewable energy filings during the city’s bankruptcy process.
  • Wind energy has been the primary source of new renewable energy in Michigan. At the end of 2013, more than 1,100 MW of utility-scale wind projects were in operation in Michigan. Michigan’s wind generation is expected to increase to more than 1,400 MW by the end of 2014.
  • Statewide, significant investment has been made in the renewable-energy sector since the passage of Public Act 295 in 2008. Conservatively, more than $2.2 billion has been invested to bring 1,113 MW of new renewable-energy projects online through 2013 in Michigan.