Manufacturing and Sustainability

Advanced energy sector sees opportunities

Michigan Energy Innovation Business Council continues to look for ways to be energy efficient.

November 25, 2016
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The Michigan Energy Innovation Business Council wants to ensure Michigan remains “open for business” in the advanced energy sector.

The business trade organization represents approximately 100 companies active in Michigan’s advanced energy sector, from small businesses like solar installers to large businesses like Rockford Construction and Granger. It has a mission of growing the state’s advanced energy economy by “fostering opportunities for innovation and business growth” and “creating a business-friendly environment” through presenting a unified voice.

While the organization said it is “neutral” on the energy legislation passed by the Michigan Senate earlier this month, it noted a “marked improvement” in the bills where its membership is concerned.

“The legislation will allow for investment in Michigan and help ensure we continue to see the benefits of adding fixed-price, low-cost renewable energy into Michigan’s energy mix,” said Liesl Eichler Clark, president of Michigan Energy Innovation Business Council. “We must continue the cost trends that have added $2.9 billion in economic benefits related to renewable energy development for Michigan.”

Eichler Clark said the Michigan Energy Innovation Business Council believes any major energy legislation should work toward three main goals: maintaining affordability for ratepayers by maximizing low-cost energy efficiency and using fuel-less generation sources to hedge against volatility in fossil fuel prices; aligning ratepayer interests with those of Michigan’s utilities by eliminating barriers to utilities integrating advanced energy solutions into their business models; and spurring innovation and driving down costs for ratepayers by ensuring meaningful market access for third-party energy providers.

She said in particular, the inclusion of an increased renewable portfolio standard — from 10 percent previously to 15 percent in the new legislation — hangs an “open for business” sign on Michigan. She also said energy waste reduction provisions “improve and solidify” the benefits to ratepayers from energy efficiency, including lower rates and offsetting future generation costs.

She identified provisions around “innovation and driving down costs for ratepayers by ensuring meaningful market access” as remaining challenges relating to the bills.

“The handling of distributed generation out into the future is still a challenge,” she said. “Michigan has a successful net metering law that has been in place since 2008 and is capped at half of 1 percent of load. The changes to this provision in the statute create concerns for the Michigan EIBC membership.

“In addition, the legislature should retain the current requirement that allows independent developers to build 50 percent of new renewable projects, which has injected competitive pressures into the renewables landscape and driven down costs for ratepayers.”

Eichler Clark previously said the Michigan Energy Innovation Business Council was particularly concerned about the renewable portfolio standard in the energy bills — previous versions didn’t include an RPS.

“Because the renewable portfolio standard really drives expansion of renewables in the state,” she said.

She said without an RPS, some new deployment likely would occur, but an RPS ensures that deployment. It also gives more businesses access to renewables.

“More and more businesses are interested in renewables and efficiency,” Eichler Clark said. “Some are big like Switch and can talk to Consumers about a tariff, but some aren’t. So, how can we ensure those businesses and the ratepayers of Michigan are getting this type of generation? You do it through a renewable portfolio standard.”

She also said energy efficiency remains important to her membership.

“Since 2008, we learned that renewables and energy efficiency really work,” she said. “Both of those programs were implemented at rates much cheaper than expected when passed in 2008.

“We built in off ramps from a cost perspective for both programs and neither was ever hit. In fact, on the renewables side, the surcharges that were built in to support the utilities’ build-out were dropped years ago, because it wasn’t necessary, because costs had declined so rapidly.”

She said in 2008, if a wind farm was built, approximately 20 percent of energy would come from it, where as today, because of improvements, that rate is 50 percent.

“We are seeing a 30-percent improvement in the last eight years of deployment,” she said.

She said on the efficiency side, the government reported for every $1 spent on energy efficiency programs in the state, there is a $4 return on investment.

“It’s a fantastic return for the investment,” she said.

The Michigan Energy Innovation Business Council also is paying close attention to discussions on integrated resource planning and proposed changes to the Certificate of Need process.

“Adding the ability for different types of resources to be figured in when we are doing the planning process will be really important,” Eichler Clark said. “So, making sure demand response, energy efficiency, combined heat and power, a lot of different advanced energy resources, can be valued in a planning process, making sure that option is there and making sure stakeholders have input.”

She said the Michigan Energy Innovation Business Council wants to see a final energy bill that is “nimble and adaptable,” and that prioritizes “low-cost power, affordability, reliability and environmental responsibility.”

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