The solar market continues to grow in Michigan despite lacking a strong state policy to encourage it. There are no state tax credits or solar carve outs, but there are 121 solar companies in Michigan, according to a report from the Environmental Law and Policy Center. The report estimates 6,300 jobs in the state are tied to the solar industry.
In 2008, Michigan adopted a Renewable Portfolio Standard (RPS) of 10% by 2015, but 94% of the new capacity is wind power. While Michigan lacks a solar carve out, solar energy is given extra value by a provision that one megawatt-hour (MWh) from solar generates one renewable energy certificate (REC) plus two Michigan incentive RECs. There are also Michigan incentive RECs for in- By John Sarver, Executive Director, Great Lakes Renewable Energy Association state manufacturing, installation by in-state labor, and on-peak production. That means one solar REC in Michigan can be worth 3.4 RECs. However, the incentive RECs have not affected solar development in Michigan because there is more than an adequate supply of RECs.
RPS plans for Michigan’s two biggest utilities, Consumers Energy and DTE Electric, include solar pilot programs. Consumers Energy’s original pilot was approved in 2009 for 2 MW. The program takes a feed-in-tariff approach that started with 65 cents/kWh but is now down to 20 to 26 cents/kWh. The program was expanded by 4 MW in 2011. DTE Electric had an original program of 20 MW, including 5 MW for customerowned and 15 MW for company-owned utilities. In 2012, a 2-MW expansion was approved. The DTE approach includes both up-front and long-term payments for RECs. The pilots have had more interest than they could accommodate and thus have to use lotteries.
True net-metering for smaller systems (up to 20 kW) provides a modest incentive, with a bill credit at the retail rate. Modified net-metering provides a credit at a generation rate for systems up to 150 kW. The number of net-metering customers increased from 1,015 in 2011 to 1,330 in 2012, and the total size of the program increased 55% to 9,583 kW in 2012. Solar power was the most popular, with an additional 294 customer installations totaling 2,665 kW in 2012.
Community-level activity related to solar increased in 2013. Four municipalities in the Saginaw area are working together on a project led by the Clean Energy Coalition and funded by the Michigan Energy Office to streamline local permitting, planning and zoning processes related to solar. The cities of Midland, Saginaw, Thomas Township and Williams Township are on the way to becoming the first “solar-ready” communities in Michigan.
The Great Lakes Renewable Energy Association (GLREA) is also leading a community-solar initiative. A feasibility study and guidebook, funded by the Michigan Energy Office, will be available in early October to assist Michigan communities. GLREA, while doing research for the project, participated in 13 public forums that reached 241 people and met with 14 organizations interested in starting a community solar project.
Meanwhile, two Michigan utilities, Cherryland Electric Cooperative (CEC) and Traverse City Light & Power (TCL&P), have started Michigan’s first community-solar program. CEC will have 224 solar panels installed next to its headquarters. Individuals are able to sign 25-year lease agreements for a one-time fee of $470 per solar panel. A $75 energy efficiency incentive drops the member’s cost to $395. CEC members who commit to leases will receive monthly billing credits for the solar electricity produced in that particular month. Traverse City Light & Power decided to partner with Cherryland and make it possible for its customers to participate.
Solar should be big in Michigan in 2014. The state will develop new energy policies. Streamlined permitting and planning is reducing soft costs, and community solar is providing a new way to finance projects. Michigan solar companies see the trends and economic potential and are enthusiastic about expanding and developing new products to move solar forward. SPW
By John Sarver, Executive Director, Great Lakes Renewable Energy Association
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