Michigan solar total remains low among renewable energy options

The Michigan Public Service Commission (MPSC) released its annual Renewable Energy Standard report, revealing the modest if growing state of the Wolverine State’s solar sector.

Michigan generates 2.7% of U.S. electricity, ranking 11th among states. But it is a laggard in the solar market, according to the Solar Energy Industries Association. Michigan’s 107 MW of PV capacity in 2017 ranks it 31st in the U.S., but is only 0.2% of the national total of over 44 gigawatts (GW) of installed capacity. Within the state, only 0.1% of its electricity comes directly from the sun. SEIA expects the Michigan market to grow by 668 MW in the next five years

Under its Public Act 295 legislation, Michigan set a requirement that utilities procure 10% of their electricity from renewable energy by the end of 2015, with an increase to 12.5% for the years 2019 and 2020, going to 15% by 2021. In 2016, renewable generated electricity in Michigan reached 10.8% of retail sales. The eventual legislative goal is 35% generated by renewables and waste by 2025. There is also a ballot initiative calling for 30% renewable energy by 2030.

The MPSC report shows that renewable energy has been and is primarily wind power dominated, with solar powered electric generation at best reaching 1% of total renewable energy in some years, and usually falling below. Wind power generation is generally in 40-49% range. In nameplate terms, by February 2018, solar power would be about 3% of the 2,900 MW of renewable energy capacity, shadowed by wind power’s 69%.

The MPSC renewable energy plan of growth used a comparison of the cost of the various technologies against a benchmark of a new coal power plant, which was determined to cost $133 per megawatt-hour (MWh). The weighted average of the renewable energy technologies from 2009 through 2017 fell below this benchmark at $76.20/MWh, with wind coming in at $70.01/MWh and even solar at $121.27/MW, despite being in a relatively small market. Acquisition of renewable energy systems by utilities is financed by a charge that is compared against long term natural gas contracts, with the difference of the higher price of renewables charged to higher meter rates.

The MPSC report showed a considerable decline in the contracts charged for PV, though no data was apparently available past 2016 which likely would have shown even lower costs. For example, the 2 MW Consumers Energy Solar Gardens, approved in 2015 and installed in 2016, had residential ratepayers contracts for some or all of their electricity charged $0.199 to $0.243/kWh for up to a 15 year time period. PV electricity from Consumers Energy smaller scale systems installed in 2014 and 2015 were assessed at $0.199-0.243/kWh for nonresidential contracts and $0.243-0.249/kWh for residential. Small scale installations in 2012 were contracted at $0.375 nonresidential, $0.525/kWh residential and in 2010, $0.45/kWh non residential and $0.65/kWh residential. The earlier contracts had up to a 12 year span.

Detroit Edison numbers in their Solar Currents and other contracts were reported in different ways. Their 50 MW program, approved in 2015 and installed in 2016, reported a $113.52/MWh contract and installations approved in 2012 and installed in 2014 reported a contract of $3,741/kW. Another, earlier, large PV module contract was reported at $2/watt, with another initiative reporting a mixed contract of capacity and generation costs.