OpEd: Empowering People to Power Michigan

Rep. Jeff Irwin is serving his second term as state representative for the 53rd District. 
  
Prior to his election, Rep. Irwin served the people of Ann Arbor as a Washtenaw County Commissioner for 11 years, where he worked to promote government collaboration, protect natural areas, and support public transit. He is a founding member of Partners for Transit, which is committed to providing countywide public transit to Washtenaw residents. Rep. Irwin also previously worked for the League of Conservation Voters Education Fund and for then-state Sen. Alma Wheeler Smith.
  
Rep. Irwin and his wife, Kathryn, live in Ann Arbor with their daughter, Sylvia, and son, Mackinac.


Empowering People to Power Michigan

Michigan's 2008 renewable energy standards will expire soon, prompting what is sure to be a vigorous policy debate over our state's energy future. The decisions we make now will shape Michigan's economy for decades to come and will determine whether Michigan strengthens our commitment to renewable and diversified energy sources, or continues to rely on outdated energy models that send dollars and jobs out of state.

Since 2008, renewables have been much more successful than originally anticipated. Growth in clean energy generation, along with energy conservation measures, brought costs down much faster than expected. Despite this, Michigan's current policies create a number of regulatory and economic barriers to clean energy development and to realizing the economic benefits that come with producing energy right here in our state. 

That's why I, along with legislators from both parties, introduced a package of bills to eliminate as many of those barriers as possible. We call it Energy Freedom. The legislation blends pro-consumer reforms with a market-based approach. By encouraging production of clean, renewable energy, this legislative proposal would also improve economic stability, provide good-paying jobs, and create a healthier Michigan.

Energy Freedom (House Bills 5673, 5674, 5675, and 5676) would create sensible policies for net metering, fair pricing, community-owned energy gardens, and grid improvements. Energy Freedom would streamline the process by which individuals, businesses, farmers or places of worship can offset their energy costs by generating their own energy. It would also ensure that energy producers receive a fair and competitive price.

Currently, over 1,500 households and businesses in Michigan offset their energy costs by producing some or all of the energy they need through personal renewable energy systems such as solar panels or wind turbines. These electric retail customers are compensated through a credit on their bills for the energy they produce through a program called net metering. The number of participants and the size of the system, however, are capped and it is estimated that within a few years the program will reach its cap, shutting residents and businesses out of the market. In fact, the Michigan Public Service Commission (MPSC) recently reported an 18-percent increase in net metering over 2012 from solar and wind sources, with solar power being the most popular. We should be encouraging renewable energy generation, not limiting it. Lifting the cap on net metering will allow more people to become energy independent, decreasing our dependence and limiting our contribution to climate change.  

In concert with net metering, fair-value pricing expands opportunities for citizens to put power back on the grid when they generate more than they need and to be paid fairly for doing so. Under this model, both the customer and the utility are fairly compensated using market-based pricing. By pricing power generated by customers based on demand, we address the utilities' concern that the cost of integrating distributed generation would otherwise be subsidized by other customers.

For those unable to install renewable energy systems on site at their home or business, Energy Freedom would enable a cooperative approach called community renewable energy gardens. This option would allow members to buy shares of a renewable energy system and receive a monthly bill credit for their shares' output. Nationally, this concept has been gaining momentum as a way for people to share the up-front costs and long-term benefits of entering the renewable energy market.

Renewable energy sources vary throughout the day the amount of energy they produce. Although these production cycles are predictable, Michigan's woefully neglected grid infrastructure needs to be upgraded to maximize reliability and efficiency for all consumers. The fourth bill in the Energy Freedom package would facilitate a smarter grid infrastructure to help integrate new producers, and couple that investment with improvements to overall grid reliability. The bill directs the MPSC to do a comprehensive study analyzing grid quality to see where updates are needed, both for reliability and to facilitate the addition of energy generated from distributed, renewable sources.

Our energy system is facing a tidal wave of change. New technology and new production methods mean that renewable sources are competitively priced and sometimes even cheaper than fossil fuels. This tipping point represents an exciting opportunity for our economy and our environment. Unfortunately, Michigan has erected regulatory and legal barriers in front of homeowners and businesses that want to take advantage of emerging opportunities. With Energy Freedom, we can dismantle those barriers, preparing our state for the future by empowering our citizens to become energy producers. By moving forward with these market-based, bi-partisan ideas, Michigan can and should be cleaner, more prosperous and more independent.