MPSC: All Michigan electric providers met or exceeded renewable energy standard in 2015, state poised to increase renewables to 15 percent by 2021

LANSING, Mich. – The Michigan Public Service Commission (MPSC) today issued its seventh annual report on the implementation of the state’s renewable energy standard. The report notes that all of Michigan’s electric providers met – or exceeded – the 10 percent renewable energy standard in 2015.

Michigan’s new renewable standard will increase to 12.5 percent in 2019 and 2020 and 15 percent in 2021, as required by Public Act 342.

“The Michigan Public Service Commission is pleased to report that the 10 percent renewable energy standard for 2015 was accomplished successfully by all Michigan electric providers,” said MPSC Chairman Sally Talberg.

“The combined efforts of the electric providers, renewable energy project developers, communities hosting renewable energy projects, renewable energy advocates and many others have contributed to the effective implementation of Michigan’s renewable energy standard.

“The standard can be credited with the development of over 1,670 megawatts (MW) of new renewable energy projects, and the average price of existing renewable energy contracts is considerably less than was forecast in initial renewable energy plans.

“The process is now underway to implement the provisions in the new renewable energy standard as enacted in Public Act 342 of 2016. The Commission intends to build on the successful activities already in place to guide Michigan’s path to meeting the 15 percent renewable energy standard in 2021.”

Highlights of the report include:

  • For 2015, the estimated renewable energy percentage reached 9.6 percent, up from 9.1 percent in 2014. As allowed by Michigan law, electric providers used banked energy credits and excess energy optimization credits to achieve the full 10 percent requirement.   

  • At the end of 2016, only two rate-regulated providers, Indiana Michigan Power Company and Wisconsin Electric Power Company, collected renewable energy surcharges on customer bills. In addition, there are seven non-rate-regulated electric providers with surcharges. Surcharges may be applied under Michigan law to cover the utility’s incremental cost of renewables.

  • Ninety-five percent of the energy credits used for 2015 compliance were from renewable energy generated in Michigan.

  • In 2009, wind represented 7 percent of energy credits created, increasing to over 50 percent in both 2015 and 2016.

  • Wind energy has been the primary source of new renewable energy in Michigan.At the end of 2016, there were 1,575 MW of utility scale wind projects in operation in Michigan.

  • Consumers Energy has filed renewable energy contracts with the MPSC totaling approximately 650 MW, and DTE Electric Company totaling approximately 1,150 MW.

  • Approximately $3.3 billion has been invested to bring approximately 1,670 MW of new renewable energy projects on-line through 2016 in Michigan.

  • The actual cost of renewable energy contracts submitted to the Commission to date continues to fall. The most recent wind contracts approved by the Commission have levelized costs in the $45 to $69 per megawatt-hour (MWh) range, approximately half of the levelized cost of the first renewable energy contracts approved in 2009 and 2010.

  • Weighting the levelized costs of all contracts by the generation in MWh results in an average cost of $73.83 per MWh, substantially lower than the cost of a new coal-fired plant.

  • The combined weighted average cost of Michigan’s energy waste reduction and renewable energy programs is $34.65 per MWh, significantly lower than the cost of all types of new fossil fuel generation plants.

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