In The News: Large solar dawns in Michigan, but residential incentives may sunset

MI Community SolarGreat Lakes Echo

Colleen Otte – Michigan’s solar future is so bright that advocates say you might just have to wear shades.

Assuming all goes as planned, Michigan may soon see a solar project nearly 50 times larger than its largest existing installation.

The state’s biggest solar project now operating is a 1.1 megawatt generator owned by DTE Energy in Ann Arbor, said John Sarver, president of the Great Lakes Renewable Energy Association.

“But there are much bigger projects planned, including 10 megawatts at Michigan State University and 20 megawatts with the Lansing Board of Water & Light,” Sarver said.

Large-scale solar

DTE is constructing a 1.9-megawatt solar array that will be the largest operating solar facility in the state when it comes on line at the end of the year, said DTE communications specialist Vanessa Waters. The company will install 6,900 solar panels at its Greenwood Energy Center in St. Clair County. That’s enough to cover two football fields.

“The array will produce enough electricity to power approximately 330 homes,” Waters said. The project is part of a pilot program launched in 2009 and expected to produce 20 megawatts of solar power – five of which customer-owned – by 2016.

Even so, this array would be dwarfed by a 50-megawatt solar energy project DTE has proposed across several sites, Waters said.

And there could be more on tap.

“We keep seeing that when plans are announced, it’s going to be the biggest in the state — but then there’s plans for bigger projects so that by the time it’s actually installed, it might not be the biggest,” said Andy McGlashen, communications director for the Michigan Environmental Council. “That’s a good problem to have.”

Michigan has 2,100 workers in the solar industry, including manufacturers, installers, sales people and others involved in implementing solar energy, Sarver said.

“It’s a significant number and it’s growing,” he said.

The size and growth of the industry in Michigan is comparable to most states in the Great Lakes region.

And it’s not just about generating electricity. Michigan’s solar industry includes two solar panel manufacturers and five companies that manufacture the racks for the systems, Sarver said.

But Minnesota is the Midwest leader in solar policy, he said.

“They have some legislation which is very progressive with respect to solar energy, including community solar,” Sarver said.

Community solar

 McGlashen said that community solar is an opportunity for people to invest in solar energy, even if they lack the room or budget to install their own array,

In exchange for leasing solar panels, these residents get the benefit of knowing they’re contributing to a cleaner energy source that’s better for the air and water, as well as a tax credit at the end of the year for the energy produced by their share of the array.

Last year, East Lansing, Michigan, officials found overwhelming support for community solar, McGlashen said. The city will allow residents to lease a panel for $400, he said.

“East Lansing is a fairly progressive town, but I also think the community’s enthusiasm indicates broader support for solar power around Michigan and around the country,” he said.

Sarver’s group got involved with community solar in 2013. At the same time, Cherryland Electric Co-op. – near Traverse City – launched a project that made it the first in the state to adopt community solar.

Five other Michigan utilities are in various stages of community solar projects: Traverse City Light & Power, Marquette Light & Power and Homeworks Tri-County Electric in Portland, Michigan, all have projects. The Lansing Board of Water & Light is talking about two e projects, and Consumers Energy boasts potentially 10 projects, said Sarver. There is also a private, third-party project in Laketown Township near Holland by Community Green Energy, a Wisconsin company.

“These kinds of projects take a while to develop, so we’ve seen good progress in Michigan since things really got started back in 2013,” Sarver said.

Even so, advocates say there is room for improvement. There are approximately 1,800 rooftop solar customers in Michigan – 1,100 of which are DTE Energy customers. By comparison, DTE has more than 2.1 million electric customers, Waters said.

McGlashen said solar is well behind wind power, but between Michigan’s universities and businesses, there has been a lot of solar innovation. For example, Michigan State University recently developed a clear pane of glass that also functions as a solar panel.

To the extent lawmakers support solar power, they’re also supporting innovations that will make it more efficient and affordable, McGlashen said.

“We had our state law that said by the end of this year, the utilities had to get 10 percent of their power from renewable sources,” he said. “They’re right around that 10 percent mark, and I think wind is by far the bulk of that. I think solar is right around 1 percent of our electricity generation in Michigan.”

If legislators keep a fair price for homeowners who sell solar power back to the utilities, it could unlock even more potential, he said.

With net-metering, “you can shrink your electricity bill by generating power on your property, or in some cases even sell excess power back to the grid,” McGlashen said.

Looming legislation

But proposed legislation could put the incentives in jeopardy, McGlashen said. If the new rules are passed, residential solar owners will have to buy all their power at the retail rate, but then can only sell the power they produce back at the wholesale rate, which is much lower.

“This fails to recognize that solar has a higher value for the benefits it provides to the grid,” McGlashen said. “And if you think about it, solar power is most available when the demand is highest: right in the middle of those sunny summer days when everyone’s got their air conditioning cranked.”

But backers of the move to kill incentives say they aren’t fair.

Everyone depends on the same power grid to supply reliable, affordable power for their homes and businesses and all customers deserve to be treated fairly regardless of the source of power, said Waters from DTE.

Customers, utilities, the solar power industry and state government learned how solar fits into the larger energy system through the incentives and subsidies designed to spur early adoption, she said.

“Now we need to move on to the next phase, where the role of solar power will be determined by the benefits it provides compared to other sources of electric generation,” Waters said. “For solar power to compete fairly with other technologies, Michigan’s net-metering rules need to be updated to provide the correct price signals to the market.”

DTE would welcome a discussion on “grandfathering” current net-metering customers, she said.

“Those customers decided to make a significant investment based on the payback they would receive under the initial net metering rules and we need to make sure those customers are treated fairly,” she said.

Utility-scale solar projects are half the cost of and more efficient than solar panels on individual rooftops, Waters said.

“Large-scale solar projects are more efficient and economic due to economies of scale and location in open fields where they receive the maximum exposure to light,” she said. “Even so, the costs of solar energy remain much higher than the cost of wind energy in Michigan.”

Still, solar advocates say the state has begun to see the light.

“I think it’s safe to say [Michigan] has a long way to go,” McGlashen said. “We’re just starting to tap into the potential for solar here.”

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