Senate puts off vote on energy policy overhaul
Lansing — The Michigan Senate adjourned Tuesday without voting on a sweeping plan to overhaul the state’s energy policy, holding off on the proposal after hours of closed-door debate by the Republican majority.
Senate Majority Leader Arlan Meekhof, R-West Olive, said voting this week on the two-bill package would have been a “heavy lift” because members who are not on the energy committee were not familiar with all the details and were set to consider bill changes on the floor.
“Finding the right combination of policies and votes, I think, is important, and it’s going to take some more explanation before people can understand it, before they can cast an intelligent vote,” Meekhof said after session.
Months of intense lobbying for and against the energy legislation escalated Tuesday morning when a diverse coalition of conservative, liberal, environmental and business groups gathered outside the Senate chambers to voice opposition ahead of a possible vote.
“The only thing we all agree to here is we don’t want this bill,” said former state Rep. Pete Lund, a Shelby Township Republican who now heads the Michigan chapter of Americans for Prosperity.
The energy package, spurred by the retirement of coal-fired power plants and the threat of additional federal regulations, is supported by DTE Energy of Detroit, Consumers Energy of Jackson and the head of Gov. Rick Snyder’s energy agency.
But the legislation is facing opposition on multiple fronts, including rejection by environmental groups concerned that the plan would replace a renewable energy mandate with a more flexible “goal” of 35 percent renewable energy and waste reduction by 2025.
“We are poised here to be the first state in the nation to repeal a (renewable energy standard),” said James Clift of the Michigan Environmental Council. “That is going to mean businesses going elsewhere.”
Conservative groups like Americans for Prosperity and the Michigan Freedom Fund oppose the bills because they would place new restrictions on Michigan’s “choice” program, which allows alternative energy suppliers to provide 10 percent of the state’s electricity at reduced rates. There are roughly 6,000 customers in the capped choice program, with another 11,000 waiting in line.
Under the legislation, alternative suppliers would have to prove they could buy or generate enough energy to meet the demands of their customers for three years. The bills also would impose a new electric generation service charge on customers who move into the choice market.
“If you want to know why the grassroots are revolting in two parties, you need to study this issue,” Lund said. “This is a perfect example. I don’t know of a conservative Republican in the Senate who ran for office saying they were going to do something to crush competition and drive up rates for the people of Michigan.”
Sponsoring Sen. Mike Nofs, R-Battle Creek, has disputed criticism that the package would “kill” electric choice but has acknowledged it could lead to higher rates for choice customers. Major utilities argue that regular rate payers effectively subsidize the choice program because alternative suppliers do not invest in the state’s energy system infrastructure.
“They just don’t want to pay their reliability aspect of the bill that we presently have been covering for them — I say we, the regulated customers,” Nofs said, referencing “local clearing” requirements for utilities designed to ensure adequate supply for peak usage times.
The debate is difficult, he said, because of big companies that save money though the electric choice program operate in most parts of the state, including Kellogg Co.’s food manufacturing company in his own district.
“But I’m still voting for it,” he said. “It’s the right thing to do because it takes care of reliability for all of us going forward, including Kellogg’s.”
Senate Republicans, who enjoy a super-majority, caucused on the bills for several hours Tuesday but adjourned at roughly 5 p.m. The upper chamber is not expected to hold any votes Wednesday or Thursday, meaning the energy debate is likely to continue well into June.
“We got maybe a third of the way through (an analysis of the package). There was lots of questions,” Meekhof said. “For folks that don’t serve on the committee and aren’t engaged in this every day, it’s a lot of stuff.”