Last week, President Obama introduced a new EPA Clean Power Plan. The plan represents the first time that national regulations for carbon dioxide emissions have been issued for U.S. power plants—calling on them to cut carbon dioxide emissions from existing plants by 32 percent by 2030 (compared to 2005 levels).
The EPA’s new plan makes it even more urgent for Michigan to put into place a comprehensive energy policy aimed at taking control of our energy future. Legislators in Lansing must work quickly to craft energy policy that is right for Michigan before the federal government steps in. The last thing we need is the federal government dictating the path that Michigan follows and putting in place solutions that don’t make sense for us or our state.
Where Michigan Stands Now
Fortunately, Michigan has already made great progress toward transitioning to a cleaner, more sustainable energy future—thanks to the forward-thinking strategies of local energy providers to incorporate greater use of renewables and improve the state’s energy efficiency. These successes have Michigan leading the way nationally.
However, as a result of the Clean Power Plan, as well as other existing EPA regulations, Michigan will retire up to 60 percent of its coal-fired power plants over the next 15 years—representing 30 percent of our state’s total generation. In the face of these plant closures and now stricter EPA rules, Michigan must enact policy that addresses two key factors:
Regulating out-of-state retail energy marketers in a way that holds them accountable for planning for and investing in Michigan’s energy infrastructure to ensure we can maintain needed capacity
Integrating renewable energy in a way that doesn’t compromise reliability, affordability, or fairness for all Michiganders
Implications for Michigan Renewable Energy
The EPA’s new plan means Michigan must accelerate the pace at which we integrate clean energy into our state’s energy mix. To do so responsibly, it is important that we are able to use a wide variety of technologies and approaches. Certain aspects of the EPA’s new rule confuse the issue somewhat in that they would actually penalize Michigan for some of what we are already doing to integrate renewable energy.
For example, according to the EPA’s new rule, the Ludington Pumped Storage Power Plant, which has been a key piece of our renewable efforts up to now, could actually count against Michigan when it comes to the EPA requirements. Here’s why:
The Ludington Plant operates by pumping water from Lake Michigan uphill during times of low electricity demand.
The plant stores the water in a reservoir and releases the water downhill to produce energy when demand increases.
The EPA’s new plan would penalize the plant for the energy it takes to pump the water uphill, but then would not count the energy created by the water’s release toward the new renewable portfolio standards.
Unless something changes, it looks like the EPA’s new plan is a lose-lose situation for the Ludington Pumped Storage Power Plant, putting in question the $800 million updates currently underway at the plant. Michigan’s legislators must act expeditiously to help achieve clarity and provide greater certainty to Michigan’s local energy providers as to what will and won’t be included in Michigan’s renewable energy efforts moving forward.
Michigan Must Act Now to Take Hold of Its Energy Future
Even before the EPA released its plan, Michigan needed to move forward with a new energy policy that put us in control of our energy future. Now, the situation is even more urgent.
Legislation from Senators Nofs and Proos, as well as legislation in the house sponsored by Representative Nesbitt, continues to provide good options for allowing Michigan to chart its own course. The principles espoused by both proposals focus on allowing local energy providers to leverage the right mix of energy sources to meet demand for consumers.
We will be keeping you posted on reactions from Congress and potential legal challenges to the EPA plan as they develop. We’ll also continue to follow the developments in Lansing closely.
What do you think of the EPA’s Clean Power Plan and what it means for Michigan? Sound off here.