#Comebackcity: How Clean Energy can Revitalize a City, State

This blog is a guest blog written by Ariana Gonzalez with the National Resources Defense Council (NRDC). It was originally posted here

Go ahead. Call it a comeback.

Governor Snyder and others have been touting how Michigan cities like Detroit are surging forward like never before. The recent grand opening of the new Outdoor Adventure Center in a Detroit building formerly vacant for twenty years is just one example of the city’s rebirth. But, don’t think this growth is just contained to in-state revamps. It’s also extending to new businesses like Shinola and GalaxESolutions who are finding reasons to set up shop in town.

Old Globe Building.jpg

Former Globe Building. Globe Building Interior Transformation into the Outdoor Adventure Center” by Michigan DNR is licensed under CC BY 2.0.

The New York Times recently chronicled a similar story of revitalization occurring in Buffalo where the wind and solar industry are attracting companies like SolarCity, BQ Energy (a renewable-energy developer), and the renewables-friendly Yahoo. With the prospect of good clean energy jobs, a flood of people, many youth returning home, are gravitating to Buffalo. The message is clear: companies and individuals alike see the promise of a city increasingly embracing clean energy.

Over the years, Detroit’s population has become more known for mass exoduses than influxes. But, that story could be put firmly in the past. With smart energy policy in Michigan, Detroit could follow in Buffalo’s footsteps: becoming a hub of solar, wind, and other renewables that continues to feed the city’s renaissance.

In New York, it’s clear that the enlightened Reforming the Energy Vision (REV) process has been an important back drop in advancing this new dawn of clean energy development. The goal of the “energy modernization” initiative is to build a bridge to a cleaner, more efficient, and affordable energy system which will help protect the environment, lower energy costs, and create opportunity for economic growth. Sounds a lot like all the goals and ambitions Governor Snyder outlined, but with the enforceable policy process to back it up.

The final, historic rule limiting carbon pollution from power plants is likely to come out next week and at this critical juncture between state and federal energy policy, Michigan needs to commit and put some teeth in its legislation. As currently proposed, however, the bills on the table look to do just the opposite. HB 4297, SB 437, and SB 438 will paralyze Michigan’s ability to provide affordable, reliable, and clean energy to the state while boosting the economy. The following are five ways to most critically improve the recently introduced Senate Bills, though this list is by no means exhaustive.

  1. Maintain and increase, based on cost-effective potential, the energy optimization standard (EOS) and renewable portfolio standard (RPS) for electric utilities. Setting a minimum energy efficiency/waste reduction goal, with incentives for utilities that capture cost-effective savings beyond the targeted amount has been enforceable and effective in Michigan, and many other states, and sends an important signal to markets that still have barriers for these resources.
  2. Eliminate artificial caps on the budgets for energy efficiency as long the utility efficiency portfolio is, on the whole, cost-effective. The spending cap limits a utility’s ability to take full advantage of energy efficiency’s potential–a limitation that is absent for every other resource.
  3. Properly value energy efficiency and renewable energy. Consideration in the integrated resource planning (IRP) process is undermined by assigning no value at all to environmental benefits that extend beyond minimal compliance with federal regulations and requiring resources to compete mostly on the basis of their value as a capacity resource – rather than on the basis of all costs of generating, transmitting and delivering electricity.
    1. Require the Integrated Resource Planning (IRP) policy to have utilities include all of the cost-effective potential for energy savings in their plans before the utility is able to invest in supply side resources.
    2. Include the words “symmetrical” and “true-up”in the language clarifying the Commission’s authority to approve proposals to decoupling utility revenues from electricity sales. This ensures that utility financial health is not dependent on energy sales, but on service as a whole.
    3. Remove, do not create, barriers for customers who want to install energy systems (net metering) so that they can be appropriately compensated for electricity and other benefits their systems provide to the grid (while paying appropriately for their own use of the grid).

We know what works for Michigan. We know what builds the economy, lowers energy bills, protects the environment and reliably provides energy. And, it’s echoed in cities like Buffalo. Now is not the time to walk away from that. As currently proposed, the bills would eliminate mechanisms for accountability (EOS and RES) in the pursuit of a new and ambiguous pathway where everything rests on an IRP with no guarantee. Let’s get Michigan’s leaders to recognize this and build on our current success, not dismantle it.

Additional Resources:

Check out CEDAM’s Resource Library and download the Michigan Energy Efficiency Incentive Programs for Multifamily Affordable Housing list.