We are just a few weeks away from the Upper Peninsula Energy Task Force’s deadline to submit its final report to the governor about how to confront the complicated challenges facing the Upper Peninsula and its access to reliable, affordable and clean energy.
On March 3, the task force held one of its last meetings, in which the members discussed the draft recommendations for the final report, due March 31, and potential ways to improve the recommendations.
Before we go over some of the recommendations, catch up on some of our previous blog posts about the UP, including this first entry that set the stage and this post about the task force’s first report, which focused on propane.
Here are some of the draft recommendations the task force discussed at the meeting:
- Renew the requirement for energy waste reduction targets for municipal and cooperative utilities (more on that below).
- All UP electric providers will be asked to participate in a region-wide electric plan. The plan would conduct forecasts of electricity demand, assess grid reliability and explore opportunities for collaboration among different energy providers.
- The Michigan Department of Environment, Great Lakes and Energy (EGLE) should consider expanded financing programs for energy projects, such as revolving loan funding specifically for the UP.
- Building off the Zoning for Renewable Energy database which can be used to identify localities that do or do not support renewable energy projects, EGLE should “provide technical assistance and grant funding to local communities to support planning and zoning to streamline renewable energy development.”
- EGLE should provide grant funding to expand electric vehicle fast-charging infrastructure across the UP.
- Convene a workshop with state agencies to determine how to change low-income energy assistance funding so it can be used to pre-buy propane so customers have adequate supplies to get through heating seasons without being exposed to price spikes.
- EGLE and the Michigan Department of Natural Resources should make an inventory of brownfield sites, post-industrial sites and marginal state lands that could be used for energy infrastructure development. An example of a model project is Consumers Energy’s project to redevelop the blighted, asbestos-contaminated site of a burned-down factory in Cadillac into a solar power facility.
The task force members talked about how to improve the recommendations. One of the biggest challenges for implementing these policy changes has to do with how many of the utilities serving the UP are cooperatives or municipal utilities that are not regulated by the Michigan Public Service Commission (MPSC). The majority of the Lower Peninsula is served by investor-owned utilities whose rates are regulated by the MPSC. But in the UP around half of customers are served by utilities managed by locally elected officials, and these utilities often lack access to capital or incentives to take on systemic actions contemplated by the task force.
For example, utilities in Michigan must comply with targets, set by the state legislature, for continual improvements in energy efficiency. These targets are met through programs to help customers save energy. While investor-owned utilities will continue to have to increase efficiency, targets expire for co-ops and municipal utilities at the end of this year. “When half of the customers in the geography are folks who don’t have to participate in programs, it makes it very difficult to operate those types of incentive programs,” MPSC Chairman Dan Scripps said during the meeting. The task force sees incentives for energy efficiency as a critical part of a strategy to make the UP less vulnerable to energy disruptions. But unless the legislature passes another bill that extends the targets, the co-ops and munis in the UP will no longer be subject to those requirements to reduce energy waste for customers. “Absent such a requirement, it is unclear whether the customers of these utilities will continue to see the many benefits [energy waste reduction] programs can provide,” the MPSC said in a recent report.