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Thursday, December 3, 2015

Position Statement on Energy Policy

Sierra Club Michigan Chapter Position Statement 

Energy Policy

Sierra Club encourages lawmakers to expand Michigan’s renewable energy and efficiency programs, and more specifically:
- Increase Michigan's renewable energy standard to 30% by 2030.
- Increase Michigan's energy efficiency/optimization standard from 1% to 2% annually.
- Remove the existing spending cap on Michigan's energy efficiency program.
- Ensure that "clean" or "renewable" energy is not redefined to include any fossil fuels, nuclear energy, or energy from incinerating wastes.
- Ensure that customers are able to produce their own energy and are allowed to either use that energy themselves or sell it back to a utility company at full price, not a wholesale price.
- Enable everyone to participate in community renewable energy projects.

Issue Background
In 2008, the Michigan Legislature passed the Clean, Renewable, and Efficient Energy Act (PA 295). The law put in place a Renewable Energy Standard (RES) that requires Michigan’s utility companies to obtain 10% of their electricity from clean and renewable sources by 2015. The law also created an energy efficiency program, which is funded through a small fee on all ratepayers’ energy bills to help homeowners and businesses make their homes and offices more energy efficient.

PA295 has been an unparalleled success. All major utilities have met the 10% renewable energy standard and have reduced/eliminated surcharges to pay for it. While the costs of coal and nuclear energy range from $108-133 per megawatt/hour, wind contracts cost between $43-59 per megawatt/hour, which is cheaper than natural gas at $67 per MWh. The Michigan Public Service Commission’s 2013 report on renewables states that Michigan can achieve a 30% renewable energy standard (RES) without technical difficulties or increased costs. PA 295 defined renewable energy to include solar, wind, hydroelectric, biomass, geothermal, and landfill gas.

Michigan’s energy efficiency standard of 1% annual savings has also been successful. For every $1 invested in our energy efficiency program, ratepayers have saved $4.38. Energy efficiency is the most cost-effective way to reduce spending on electricity, costing $11 per MWh, cheaper than any form of new generation. The 2008 law also set a cap on how much utilities could spend on energy efficiency.

Sierra Club Perspective
Fossil fuels create $523 billion of domestic public health and environmental costs annually and receive over $500 billion in annual subsidies from our government. The Legislature should increase Michigan’s RES to 30% by 2030 and increase its efficiency standard to 2% annually. This would combat subsidies/costs and promote meaningful progress in climate disaster mitigation. The legislature should also ensure that customers are able to produce their own energy and sell it at full price.

Michigan currently spends $24 billion per year importing fuel into the state. 100% of our fuel for coal and nuclear power comes from out-of-state, 99% of our petroleum and 80% of our natural gas as well. Solar, wind and energy efficiency have no fuel costs and don’t send our money out of state.

The Sierra Club opposes proposals to gut the definition of renewable/clean energy. Fossil fuels, nuclear energy, waste incineration, and pumped storage are not renewable energy sources. Energy sources that emit air pollution (including the greenhouse gases carbon dioxide and methane), water pollution, and produce radioactive waste should not be considered “clean energy” in Michigan’s laws.

Current Legislation on Clean Energy in Michigan
There is currently no legislation introduced to establish a 30% Renewable Energy Standard annual increase.

Sierra Club Supports the Following Bills
Powering Michigan’s Future legislation SB 295-297 and HB 4518-4519, HB 4055: increase Michigan’s renewable energy standard to 20% by 2022, gradually increase the energy optimization standard until reaching 2% annually in 2019 for electricity and 1.5% for natural gas, and eliminate the renewable energy surcharge.
Bill sponsors: Hoon-Yung Hopgood, David Knezek, Sam Singh, Marcia Hovey-Wright, Julie Plawecki.

Bipartisan Energy Freedom legislation HB 4878-4881: remove barriers for businesses and individuals to generate their own energy and receive fair-value pricing. Enable community energy projects.
Bill sponsors: Gary Glenn, Ed McBroom, Scott Dianda, Jeff Irwin

HB 4304 (Jason Sheppard): prevent natural gas utilities from raising rates to pay for fines and penalties. This bill is a positive step toward establishing stricter accountability for utility companies when they fail to comply with the law.

HB 4683 (Scott Dianda): require the Michigan Public Service Commission to adopt integrated resource plans for regions of the state. This is designed to make energy distribution in the Upper Peninsula cheaper, cleaner and more reliable.

Sierra Club Opposes the Following Bills
SB 437-438 (Mike Nofs, John Proos): sunset Michigan’s Energy Optimization standard in 2019, repeal Michigan’s Renewable Energy Standard, establish a definition for “clean energy” that includes polluting fossil fuels, implement a voluntary green pricing program, eliminate net metering, destroy the distributed energy market, and replace standards with an Integrated Resource Planning process.

HB 4297-4298 (Aric Nesbitt): replace renewable energy/efficiency mandates with an Integrated Resource Planning process, establish an unenforceable 30% renewable/efficiency goal, and remove sustainability criteria for wood/tree biomass.

SB 465 (Mike Shirkey): require the legislature to review Michigan’s State Implementation Plan (SIP) for the federal Clean Power Plan and give them the power to disapprove it. It would also prevent a SIP from being submitted if there is pending litigation against the Clean Power Plan. This will handcuff our ability to comply with the Clean Power Plan, slow down our implementation, and lessen our ability to mitigate climate change.

HB 4303 (Brett Roberts): allow natural gas utilities to expand their infrastructure with Michigan Public Service Commission oversight/review and use ratepayer money to pay for it. This ratepayer money should instead be spent on repairing/replacing old natural gas pipelines, distributed generation, community renewable projects, or energy efficiency.

HB 4066 (Ray Franz): completely ban offshore wind deeds, leases, or permits in the Great Lakes.

HB 4308 (Ray Franz): repeal Michigan’s current Renewable Energy Standard.

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