MI Legislature Passes Landmark Energy Package

For nearly two years, the Alliance for Michigan Power (AMP) and other energy advocates in our state have been fighting to secure passage of legislation in Lansing to address our energy capacity challenges and provide a clear path forward for Michigan’s energy future that would put Michigan’s interests first and treat all consumers fairly.

Finally, we have a win! We’re proud and excited to report the Michigan House of Representatives passed Senate Bills 437 and 438 on December 15 by wide bipartisan margins: 79 to 28 and 76 to 31, respectively. Just over an hour later, the Senate voted to approve the House-passed bills, also by a wide bipartisan margin of 33 to 4.

Leaders in the legislature and Governor Snyder worked overtime (and then some) throughout the Lame Duck session to craft changes to the bills that, ultimately, represented a compromise in which, according to Representative Aric Nesbitt, Chair of the House Committee on Energy Policy, everybody gave a little and everybody got a little.

Of particular note for AMP members, the reworked bills address Michigan’s approach to deregulation in a way that is ultimately fair to everyone: they protect the current 10% cap on deregulation to ensure those who are already participating in that portion of the market do not see unnecessary disruptions. At the same time, the bill allows for the deregulated market to shrink if a certain number of “choice” customers return to Michigan-based utilities to protect against volatility that would negatively affect every energy consumer. The legislation directs the Public Service Commission to study the net metering issue to determine the best way to ensure some consumers aren’t unnecessarily subsidizing others’ use of the electric grid as we expand solar power production in Michigan. The law also provides a reasonable path forward for clean and renewable energy development by increasing the renewable fuel standard from 10% to 15% by 2021, and establishing a larger goal of 35 percent renewable energy and/or energy waste reduction by 2025.

A huge thanks to Governor Snyder who brokered the final deal and worked to convince both our Representatives and Senators to support its passage. And big thanks as well to the bill’s main champions in the legislature — Senators Mike Nofs and John Proos and Representative Aric Nesbitt — for laying out a solid energy plan for Michigan and working tirelessly to ensure the legislature would not adjourn in 2016 without addressing Michigan’s energy challenges in a meaningful way.

A Look Back

Senate Bills 437 and 438 were the brainchild of Senators Nofs and Proos, Chairman and Vice Chairman of the Michigan Senate Energy and Technology Committee. (That’s why these bills are sometimes referred to as the “Nofs-Proos energy package.”)

Senator Nofs introduced this legislation in July of 2015. Since then, the legislature held dozens of hearings, received tens of thousands of comments from the entire spectrum of stakeholders, and — over time — refined the energy package so it received widespread support. Groups ranging from Michigan labor unions, the African-American business community, the small-business community, and energy consumers and producers across the state stood up for this energy plan.

The Nofs-Proos package was first passed by the state Senate in November of this year, but passage in the House came down to the proverbial wire — following days of round-the-clock negotiations, SB 437 and 438 were passed on the very last day of the Lame Duck legislative session.

As one commentator put it, “State lawmakers have probably generated enough energy trying to get energy legislation to the governor over the past two years to light several small communities.”

Had the package not passed, Michigan would have been left without an energy plan for the foreseeable future. Thankfully, instead of years of additional wrangling over a comprehensive energy plan, we head into 2017 with a solid framework in place to allow us to focus on building new capacity, expanding renewable energy, and ensuring the energy needs of all Michigan consumers can be met fairly and reliably.

What this Means for Michigan

By focusing on Michigan-made energy and updating our aging electric grid, SB 437 and 438 will drive local job creation and economic growth, ensure energy investments and revenue benefit Michigan communities — including our schools, emergency services, hospitals, and more — and give Michigan — not bureaucrats in Washington, D.C., or out-of-state interests — control over what is best for Michigan when it comes to energy.

As Representative Nesbitt said in one of his floor statements during debate on the bills, this legislation “is something we can be proud of as a body.” And we agree, our “state has a bright future” because our elected representatives chose to put “Michigan first.”

A huge thanks to all AMP members who participated in our many activations in support of this legislation! It was a long but worthwhile fight!