MPSC's annual renewable energy report shows Michigan will exceed standard

February 12, 2016

Contact: Judy Palnau, 517-284-8300
Agency: Michigan Public Service Commission

LANSING, Mich. – The Michigan Public Service Commission’s sixth annual report on the implementation of the state’s renewable energy standard shows that 9.1 percent of Michigan’s electricity was generated from renewable sources in 2014. For 2015, the estimated renewable energy percentage is expected to exceed the 10 percent requirement.

“Michigan’s steady progress toward reaching – and exceeding -- the 10-percent-by-2015 renewable portfolio standard shows the state’s commitment to a diversified resource base,” said MPSC Chairman Sally Talberg. “Even more encouraging is the continued downward price trend of renewable energy contracts, the last few of which are less than any new electric generation.”

Highlights of the report include:

  • For 2014, the estimated renewable energy percentage reached 9.1 percent, up from 7.8 in 2013.

  • All electric providers are expected to be able to meet – or exceed -- the 10 percent renewable energy standard in 2015.

  • Consumers Energy has filed renewable energy contracts with the MPSC totaling 604 megawatts (MW) and DTE Electric totaling 990 MW. At the end of 2015, both utilities had obtained MPSC approval of power purchase agreements and company-owned renewable energy projects that provided the necessary capacity to exceed the 2015 legislative capacity requirements.

  • Approximately 2,500 MW of renewable energy generators are operating in Michigan and registered with the Michigan Renewable Energy Certification System (MIRECS).

  • In July 2014, Consumers Energy Company reduced its renewable energy surcharge to zero for all customers. Alpena Power Company and DTE Electric reduced renewable energy surcharges to zero for all customers effective July 2015 and December 2015, respectively.

  • There has been significant growth of wind generation in Michigan’s REC portfolio, from 7 percent in 2009 to 44 percent in 2014.

  • At the end of 2015, including wind projects shortly before PA 295 and wind projects developed under PA 295, there were over 1,500 MW of utility-scale wind projects in operation in Michigan. A total of 484 MW of new wind generation is expected to begin operating by the end of 2016 (including 333 MW developed by non-MPSC rate-regulated providers). Several large solar projects are under development and planned to begin commercial operation during 2016.

  • Through the second quarter of 2015, a cluster workforce analysis by the Michigan Workforce Development Agency in partnership with the Bureau of Labor Market Information and Strategic Initiatives showed 8,750 jobs among Michigan industries related to the renewable and alternative energy cluster, compared to 6,775 such jobs in 2005.

  • The actual cost of renewable energy contracts submitted to the MPSC to date continues to show a downward pricing trend. A recent contract approved by the MPSC for new wind capacity has levelized costs lower than $45 per MWh, about 10 percent less than the least expensive levilized contract prices from 2011 and half of the levelized cost of the first few renewable energy contracts approved in 2009 and 2010.

  • Weighting the levelized costs of these contracts by the generation in MWh results in an average cost of $76.42 per MWh, substantially lower than the cost of a new coal-fired plant.

  • The combined cost for renewable energy and energy optimization is $37.43 per MWh, less than any new generation, including new natural gas combined cycle plants, when compared to the Energy Information Administration levelized plant costs for 2014.

For 2016 and each year thereafter, PA 295 requires electric providers to maintain the same amount of renewable energy credits needed to meet the standard in 2015.

For more information about the MPSC, please visit www.michigan.gov/mpsc.

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