Michigan resumes PURPA in Consumers Energy territory

With state regulators settling on conditions for PURPA contracts after a 10-month suspension, SEIA says that the state’s solar market can now move forward. However, the devil may still be in details yet to come.

October 8, 2018 Christian Roselund

Michigan's Lapeer Solar Park

Image: DTE Energy

Utilities are conservative companies and are deeply invested in the status quo of electricity generation. And while they can’t beat solar and wind in the long run, what they can do is stall the transition.

In line with this, utilities particularly don’t like being told they have to buy power from wind and solar at prices set by regulation. As such, now that wind and solar are cheap enough to quality for contracts under the Public Utilities Regulatory Policies Act of 1978 (PURPA), the law has been fiercely resisted both by utilities, who have often convinced regulators to side with them in stopping rapid deployment of renewable energy through the program.

Michigan has been one such battleground for PURPA. The Michigan Public Service Commission (MPSC), whose members were appointed by Governor Rick Snyder (R), has often sided with utilities, even when they admit they are not considering other options. However, last Friday MPSC finally lifted a suspension of revisions to PURPA implemented last December at the behest of Consumer’s Energy, which had put an estimated 700 MW of solar projects on hold.

Under this ruling Consumers must now file rates for PURPA projects under the new calculations, which advocates say will allow solar to move forward. “The MPSC’s ruling provides much-needed certainty in the Michigan solar market, which has experienced delayed project development and a lack of substantial solar industry investment,” noted Solar Energy Industries Association (SEIA) VP of State Affairs Sean Gallagher in a press statement.

However, many details of how PURPA will be implemented in Consumers’ Service area still missing. In particular, how much capacity Consumers will be liable to contract with will depend on the utility’s Integrated Resource Plan (IRP), as was alluded to in SEIA’s comments.

“There is still more work to do, and how the MPSC rules on Consumers’ Integrated Resource Plan will play a big role in determining the future of clean energy in Michigan,” reads Gallagher’s comment.

This has been a contentious issue, as Consumers has claimed that it doesn’t need any additional capacity over the next 10 years.

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