Key Takeaways
Michigan has now passed climate laws that force people to buy more carbon-free electricity faster than California’s law.
The law requires that the state generate 80 percent of its electricity from wind, solar and other carbon-free sources by 2035 and 100 percent by 2040.
Michigan will need to dedicate more than a dozen times more land to producing wind and solar power than is presently used, while attempting to reach its 60 percent renewable portfolio standard by 2035.
Michigan businesses are protesting that skyrocketing electricity prices from the plan will make Michigan uncompetitive as a manufacturing venue, as it has in Europe.
Michigan politicians argue that Biden’s climate law will pay for it, but that funding is insufficient for the massive undertaking.
Michigan recently passed legislation that requires that the state generate 80 percent of its electricity from wind, solar and other carbon-free sources by 2035 and 100 percent by 2040, which is a faster forced energy transition than the one in California—a state that has often been the leader in climate programs with associated energy price increases. Michigan’s new legislation would also tighten energy efficiency requirements for electric utilities, have more residents enroll in a rooftop solar energy program and streamline permits for new wind and solar power. It also allows electric utilities to continue to use natural gas, as long as 90 percent of the carbon dioxide emissions released are captured and stored—an expensive technology and process not yet commercially available. The bill also mandates that utilities reach a separate renewable energy credit portfolio standard of 60 percent by 2035—a massive undertaking in just over a decade.
It Is a Long Haul for Michigan
Michigan is dependent on fossil fuels for almost two-thirds of its electricity—about the same as the nation. In 2022, coal and natural gas each supplied about a third of Michigan’s electricity. Nuclear power generated 22 percent and renewable energy, mostly wind power along the Lake Huron coastline, made up about 12 percent of the state’s power mix. While sunny places such as California or Texas have capacity factors for solar above the national average, those can drop below 5 percent during a Michigan winter, which requires much more capacity to be built to ensure adequate electricity when people need it.
According to the state’ top electric utility regulator, Dan Scripps, chairman of the Michigan Public Service Commission, Michigan could need about 209,000 additional acres of land for wind and solar power generation to achieve a proposed goal of reaching 60 percent of its energy from renewable sources. The 209,000 acres in new land equals about 326 square miles, and is 12.3 times as much land as is currently dedicated to such uses. Michigan currently has about 17,000 acres of wind and solar power generation. In addition to the 17,000 acres in use, Michigan has about 117,000 additional acres in the works for new solar and wind projects, according to Matt Helms, spokesman for the Michigan Public Service Commission. Combined, that would be about 343,000 acres total under the estimates. According to Scripps, the acreage needed to reach the proposed goals, which he described as high-end estimates, represented about 0.55 percent of the land in Michigan.
But, those estimates may actually be low. According to Brookings, wind and solar generation require at least 10 times as much land per unit of power produced than coal- or natural gas-fired power plants, including land used to produce and transport the fossil fuels. The acreage of land required could easily be more than double the estimates that the Michigan Public Service Commission provided. Depending on how much is occupied by forest, woodland, and farmland, finding the acreage could be a challenge.
Also, wind and solar generation are located where the resource availability is best instead of where it is most convenient for people and infrastructure since the wind and solar resource cannot be transported like fossil fuels. Transmission for renewable power can be even more difficult to site than the wind or solar facility itself since it may not directly benefit local residents. This is an issue today–building transmission lines to move wind power from the Great Plains and Upper Midwest states to cities in the east.
Property Rights
The land requirements bring into focus the issue of property rights of landowners and who should make the zoning and permitting decisions for large-scale solar and wind projects: local elected officials representing the people of their jurisdictions or the Michigan Public Service Commission, a panel appointed by the governor. While currently, townships, cities and counties in Michigan can set zoning and permitting standards related to solar and wind energy systems, an increasing number of townships have opposed the projects. Some rural residents have sought to repeal ordinances that are favorable to solar projects, and others have successfully recalled local officials who supported solar developments. According to Scripps, having the Michigan Public Service Commission make the decisions would be consistent with how other elements of energy infrastructure are treated such as electric transmission lines and natural gas pipelines.
Cost of the Transition
State Senator Sam Singh, a lead sponsor of the legislation, expects President Biden’s climate law, the Inflation Reduction Act, to ensure that the costs of Michigan’s energy transition were borne not by Michigan businesses and residents, but by the federal government since the law provides $370 billion in federal spending, including tax incentives for electric utilities. Unfortunately for Senator Singh, the costs of the transition to “green energy” are in the trillions and President Biden’s climate law will be a drop in the bucket towards meeting the goal, meaning that Michigan residents and businesses will pay heavily to meet the law’s goals. Since Biden became President, U.S. residential electricity prices have increased 21 percent with a 13 percent increase in 2022 from the prior year and the amount of wind and solar in the system is not anywhere near the goal.
Reality
According to Aric Nesbitt, the Republican leader in the State Senate, “Radical ideological approaches to energy policy typically result in having to correct course and revert back to traditional fuels and nuclear power that will make sure peoples’ lights come on when they flip the switch.” This is clearly where Europe, who embarked on this energy transition years ago, is today. With spiraling electricity costs, the continent had to turn back to traditional fuels. Germany and the UK, for instance, have been using coal to keep the lights and heat on.
Michael Johnston, a lobbyist for the Michigan Manufacturers Association, which represents Ford, General Motors, Stellantis, Dow Chemical and more than 1,000 other companies, said his members opposed the law because they feared the rapid transition would drive up energy costs and threaten the reliability of electricity supply. “We are the manufacturing state, and energy is a primary cost input for anything we make,” he said. “And if the price of energy rises above what Michigan-located companies can pay, the less likely we can build products here.” Europe is now faced with de-industrialization due to its spiraling energy prices. Germany placed most of its energy transition cost burden on its residential customers, but even so energy prices have increased to the point that its industries are having a hard time competing.
Conclusion
Michigan may well be making a mistake in forcing a rapid energy transition on its residents and businesses with its latest climate legislation, which is even more extreme than California’s legislation. Further, Michigan will have a harder time than California since it currently gets almost two-thirds of its electricity from fossil fuels. Some Michigan politicians are suggesting that Biden’s climate law will pay for the transition. That is highly unlikely since transitioning from fossil fuels to wind and solar power with lower capacity factors and huge land and transmission requirements will be costly. Electricity prices in the United States are already escalating as the amount of renewable electricity has increased, but the country is nowhere near hitting Biden’s goals.
