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Governor signs off on renewable energy plan

Date Posted: October 17 2008

DETROIT - A three-bill package intended to better position Michigan for green energy production and related manufacturing was signed into law Oct. 7 by Gov. Jennifer Granholm.

"This is the first step toward a significant transformation of Michigan, from an industrial economy, into a lean, green economy," Granholm told a crowd of about 150 union, business and political representatives. She signed off on the new law in the lobby of NextEnergy, an "incubator" facility near the Wayne State campus that provides space for firms to work with alternative energies.

The legislation goes a long way toward re-regulating Michigan's utility industry. The bipartisan legislation signed by Granholm includes a renewable portfolio standard that mandates 10 percent of the state's energy come from renewable sources by 2015. In addition, the law requires utilities to meet an additional 5.5 percent of Michigan's annual electrical demands through energy efficiency by 2015.

The reforms also have protections for ratepayers, although electrical rates are expected to rise over the next few years. Under the new laws, no longer will alternative energy suppliers be allowed to come into Michigan and cherry pick the best customers, while ignoring those customers that are costliest to service.

The energy package is expected to unleash more than $10 billion in power plant construction, including a new nuclear plant on the grounds of the Fermi II plant near Monroe by Detroit Edison, a new $2.3 billion coal-burner at the Consumers Energy Karn-Weadock plant near Saginaw, and more than $2 billion in new construction by Mid-Michigan Energy near Midland, among several other projects.

Consumers Energy essentially said the new restructured utility policy is a springboard to implementing its Balanced Energy Initiative, which will lead to new construction in Michigan of renewable energy, and developing new power plants, along with utilizing existing generation.

"Thanks to historic action by state lawmakers, Michigan now has the energy policy it needs to allow for a balance of energy sources and strategies, including energy efficiency and renewable energy," said John Russell, Consumers Energy's president and chief operating officer.

The Michigan Public Service Commission estimates that Michigan currently spends $26 billion every year to import fossil fuels. Granholm has argued that a renewable portfolio standard will drive investment in several different areas. The nationwide hunger for silicon (solar) panel production, for one, is pushing expansion of the Dow Corning plant in Midland. As one of the windier states, Michigan can take advantage of wind generation, since it's much more economical for manufacturers of wind turbines to build them close to where they will be installed.

Michigan already has existing tool and die and manufacturing facilities to do the work - and the people with the know-how to do it. The U.S. Department of Energy, according to Granholm, said Michigan is one of only four states with the potential to create more than 30,000 manufacturing jobs by investing in wind, solar, bio-fuels and energy efficiency.

Granholm said aggressively moving Michigan into the renewable energy arena will bring more jobs in research and development, manufacturing, and construction. "This legislation means all kinds of jobs, for all kinds of people," the governor said.

MICHIGAN GOV. Jennifer Granholm shows that she signed into law an energy package that requires Michigan utilities to obtain 10 percent of the state's energy from renewable sources by 2015. The result: billions of dollars in work for the building trades. Behind Granholm are organized labor representatives.