Michigan Solar Policy Updates - The Good & The Bad

Earlier in the year, we asked for your help in reaching out to the MPSC to encourage them to keep reimbursement rates the same - in favor of solar.  On April 20th (Earth Day of all days!) their decision was made public.  Michigan Solar Solutions thanks you for your efforts but unfortunately their decision wasn't good news.  Following is an update preceded by a little good news: There have been two items recently that have happened in Michigan that will affect those that decide to put solar electric panels on their homes.

The Good - No property tax on solar

A bill sponsored by Tom Barrett (R – District 71) to exempt solar electric systems from local property taxes passed out of committee 11-2.  Now it goes to the floor for a vote and then to the senate.  We fully expect this bill to pass with little opposition.  This will keep rouge assessors from bucking the norm and assessing property tax increases on homes that have had solar electric panels installed.

The Bad - The End of Net Metering

The Michigan Public Services Commission (MPSC) approved a utility backed proposal to end Net Metering. Net Metering is the process where solar power producers put mostly peak power onto the grid at times when they produce more power than they can consume, and take mostly off-peak power off the grid at night or when their system is not producing enough power.  The utility companies currently charge as much as 300% more for peak power than they do for off-peak power.  Net Metering customers have been content with an equal 1-for-1 credit but the utility companies have not.  Net Metering customers are the first competition many of these monopolies have ever seen.  So they have been relentless in their pursuit to end Net Metering. Other states that have gone through this process of assessing the true value of solar power have determined that solar power is worth much more than regular power.  How can this be, isn’t power – power??  Peak/off-peak valuation is one reason.  Another reason is; we build more power plants to meet peak demand.  We build them when our peak demand nears full capacity so we don’t go into brown outs or black outs.  With enough solar power we do not need these new power plants.  Some may argue that the grid peaks slightly later in the day then solar.  This is a bent narrative to protect the monopolies.  If we point the solar panels SW they will peak at the same time.  When a utility company gets the approval to build a new power plant they automatically are guaranteed to make a little over 10% on the cost of the construction of the new plant.  So the new $1,000,000,000.00 gas fired power plant in St Clair, the MPSC just approved for DTE, guarantees them over $100,000,000.00 in profit.  With cost over runs it will be more.  When the owner of a building makes over 10% on all cost over runs then of course there will be cost over runs.  DTE’s rate payers will be paying for this plant, and DTEs profits for building it, for many years to come. Here is the time line and details;

  • As of June 1st when a publically regulated utility company submits a rate case to the MPSC they have to include the replacement for Net Metering called Distributed Generation. The utility companies will propose to the MPSC what they want to pay solar system owners for the power they send to the grid. The MPSC will take 10 to 12 months to work with the utility company to finalize what the reimbursement will be.
    • NOTE: All systems that have applied for Net Metering prior to early/mid 2019 will be grandfathered in.
  • The soonest Net Metering will end for new customers is April 1, 2019
  • All existing Net Metering customers are grandfathered in for 10 years.
  • If the reimbursement rate ever exceeds the purchase price for power the solar system owner can opt out of their grandfather and enter the new Distributed Generation tariff.

Solar power is now supported by both sides of the aisle.  It is no longer a democrat verses republican issue.  All recent polls regarding support for solar have shown over 70% of Michigan’s residents support solar power. This was recently reaffirmed by the tax exemption bill for solar being sponsored by a republican and passed out of a mostly conservative tax committee with an 11 – 2 vote.

We Need Your Help

If we are going to get solar power producers a fair price, that is representative of the value of this resource and the monies it saves all rate payers, then we need to contact the MPSC and our representatives and demand they do it. Please take a moment and demand they side with over 70% of Michigan’s residence and set the reimbursement rate for power sent to the grid to be on pare with the value of the resource.  A 1-for-1 credit is the baseline for where this needs to be.  If it is going to reflect the cost savings to all rate payers for peak power vs. off-peak power and not needing more $1,000,000,000.00 plants then there should be a premium.

Here is a link to find your representative; https://www.michigan.gov/sos/0,4670,7-127-29836-88535--F,00.html   MPSC Sally Talberg – Chairperson 517-284-8330 Michigan Public Service Commission PO Box 30221 Lansing, MI 48909   Julie Baldwin, Manager Renewable Energy Section Michigan Public Service Commission 517 284-8318 Baldwinj2@michigan.gov   It has never been more important than it is now for you to start a letter writing, email sending or phone calling campaign to let your voice be heard.  The utility companies spend millions in their lobbying efforts, we just have each other. Please share this information with others and stay tuned as things develop!   Written by Mark Hagerty, May 2018 Email:  mhagerty@michigansolarsolutions.com Mark is a solar professional with Michigan Solar Solutions in Commerce, MI

The Average Return on Solar in Michigan is Over 10% Per Year

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