Lawmakers want to relax rules on renewable energy
Lansing — Homeowners and businesses that invest in renewable energy would get more freedom from regulations that favor “monopoly utilities” under recently introduced bipartisan legislation.
The five-bill “Energy Freedom” package would loosen rules on the number of people who can invest in renewable energy, the manner in which they produce and use it, and how they are compensated for energy they supply to the grid.
Rep. Gary Glenn emphasized the importance of renewable energy producers that are independent from larger “monopoly utilities” such as DTE Energy and Consumers Energy in creating a competitive renewable energy market.
“We should have as much diversity as possible,” the Williams Township Republican said. “Every man a prepper, so to speak.”
The package of bills would:
■Allow people or organizations to create energy cooperatives that would share up-front costs for renewable energy projects and receive a monthly credit on their energy bill for energy contributed to the grid.
■Increase the number of customers who can use a personal energy system to offset their energy consumption and sell excess power to the utility, referred to as “net metering.” The current cap is 1 percent.
■Let individual renewable energy producers create a microgrid to which they could connect in “island mode” should the major grid experience an outage.
■Create a “fair value pricing” framework that would compensate small-scale and large-scale renewable energy systems for energy they produced that benefited the larger grid.
The Michigan Environmental Council and League of Conservation voters supported the package of bills in a statement Tuesday, calling it “commonsense legislation” allowing Michigan residents to create clean energy.
“The Energy Freedom package ensures that anyone who wants to promote cleaner air or save on energy costs with their own renewable energy is able to do so without being encumbered by unnecessary restrictions and costs,” said James Clift, policy director for the Michigan Environmental Council.
DTE Energy spokeswoman Stephanie Beres said the utility supports customers who invest in solar, but believes “the costs associated with the distributed generation system should be priced fairly and equitably with the cost to serve these customers.”
Glenn said he expects pushback from DTE and Consumers Energy, which on Tuesday submitted cards in opposition to separate legislation that would eliminate increased costs for individual renewable energy producers.
“They’re opposed to competition, period,” Glenn said of the utlities.
Rep. Tom Barrett, R-Charlotte, said the legislation should benefit larger utilities because the increase of independent renewable energy producers would relieve some of the grid’s burden during high use times.
“If you can shave off some of that consumption by putting assets on the grid that produce energy at that most critical time, it will flatten out that demand and actually lead to a better grid system,” Barrett said.
Rep. Yousef Rabhi, D-Ann Arbor, said Michigan’s current net metering system does not adequately reimburse people who are investing in solar panels and contributing excess energy to the grid. The issue would be addressed with “fair value pricing” legislation from Rabhi and Rep. Scott Dianda, D-Calumet.
“We have to really establish a fair way to value how much those distributive energy-generating solar panels and other energy generation devices have on the system,” Rabhi said.
Rep. Steve Johnson said his bill would allow people to disconnect from the grid and tap into their own microgrid in the case of a large-scale outage.
“This is very important for our critical structures, such as schools, hospitals and water treatment plants,” said Johnson, R-Wayland. “This would allow us to recover from a natural disaster quicker than we could before.”
The energy freedom package follows the announcement of a controversial new solar tariff the Michigan Public Service Commission was tasked with developing under the 2016 energy overhaul law.
The new “distributed generation” charge is designed to cover utility costs for the transmission lines and other infrastructure that rooftop solar installations also rely on, but it has been criticized by environmental and clean energy groups fearful it could discourage new solar adopters.
Public Service Commissioner Sally Talberg defended the new “inflow outflow” charge Tuesday morning in the House Energy Policy Committee, calling it a model that “reflects the cost of service in a fundamental way and sends the right price signals” to customers.
“We are a creature of statute and recognize that if the Legislature wants to move in a different direction from a policy standpoint on this, we’re happy to be involved in assisting that and crafting changes and implementing them,” Talberg said.
Consumers Energy and DTE Energy submitted cards Tuesday in opposition to the bills that would stop the “distributed generation” model from taking effect.
Consumers Energy supports “an approach where all customers who rely on the electric grid pay their fair share of the costs it takes to maintain a reliable and sustainable energy system,” spokeswoman Katelyn Carey said.
Glenn expects the “Energy Freedom” package to be discussed in committee in mid-May.