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February 15, 2018
MPSC releases annual reports on energy waste reduction,
status of renewable energy in Michigan in 2016
LANSING, Mich. - The Michigan Public Service Commission (MPSC) today released its annual energy waste reduction (EWR) and renewable energy reports for 2016, highlighting continued customer benefits of utility EWR programs, and the growth of renewable energy projects.
The Utility Energy Waste Reduction Programs report noted Michigan utility providers met a combined average of 128 percent of their electric energy savings targets and 125 percent of their natural gas energy savings targets in 2016. EWR programs saved more than 1.19 million megawatt hours of electricity and more than 5.24 billion cubic feet of natural gas.
All electric and natural gas providers in Michigan are required by Public Act 295 to have energy waste reduction programs. Provisions in the energy laws that went into effect in April require rate-regulated utilities to include EWR programs in their integrated resource plans, which look ahead to make sure customer needs will be met in a safe, affordable and reliable manner.
Highlights of the EWR report:
Sixty-four utility providers spent $263 million to provide electric and natural gas programs, which equates to a lifetime savings benefit of more than $1 billion.
Every $1 spent on EWR programs translates to $4.29 in savings.
Just over 10 percent of the program expenditures went to low-income customers.
EWR resources cost $16.07 per megawatt hour, while generating power at a new natural gas combined cycle plant costs about $55 per megawatt hour.
EWR programs delay the need for utilities to build new generation, reduce emissions, save hundreds of millions of dollars to import fuel to Michigan, and create demand for jobs and equipment that cut energy use, all costs which otherwise would be recovered in utility rates.
The Renewable Energy Standard report shows that wind energy continues to be the primary source of new renewable energy in Michigan, with more projects expected as the state’s renewable energy mandate increases over the next few years.
At the end of 2017, there were 1,925 megawatts of utility scale wind projects operating in the state. Three wind farms with 294 MW of wind capacity began operating during 2017 and January 2018. Two others – Cross Winds III in Tuscola County and Pine River Wind in Gratiot and Isabella counties with a total of more than 235 megawatts of capacity – are expected to begin operating in the next several years.
All investor-owned, cooperative and municipal electric utilities as well as alternative electric suppliers met the state-mandated standard of supplying the same amount of renewable energy used to comply with the 10 percent standard in 2015. The standard increases to at least 12.5 percent in 2019 and 2020 and 15 percent in 2021. By 2025, state law sets a goal of meeting at least 35 percent of Michigan’s electric needs through renewable energy and EWR programs.
Highlights of the renewable energy report:
Wind accounts for 69 percent of renewable energy capacity in Michigan, hydroelectric 13 percent, biomass 7 percent, landfill gas 5 percent, and solar and municipal solid waste both at 3 percent.
In 2017, DTE Electric completed the largest solar project in Michigan, a 48-megawatt facility in Lapeer County.
The alternative energy sector accounted for 9,100 jobs in Michigan through the second quarter of 2017, according to the Bureau of Labor Market Information and Strategic Initiatives. That’s up from 6,775 in 2005. The Bureau expected the sector to grow 7.1 percent by between 2010 and 2020.
There has been $3.3 billion of investment in the renewable energy sector statewide since the passage of PA 295 in 2008, resulting in approximately 1,670 megawatts of projects coming on-line through 2017.
The average cost for renewable energy contracts is $72.60 per megawatt hour, lower than the $133 per megawatt hour for coal.
The EWR and renewable energy reports must be filed to the Legislature by Feb. 15 each year.
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