Michigan senate bill would erode the value of net metering for solar owners

Dive Brief:

Michigan Senate Bill 438 changes the state’s net energy metering (NEM) policy in a way that significantly erodes the solar value proposition, MLive reports. Solar owners are presently allowed to consume what they can of the electricity their systems produce and be paid at the retail electricity rate for the electricity sent to the grid.
The new law would require solar owners to buy all the electricity they consume from the utility and earn a lower, wholesale rate for the electricity sent to the grid. The Alliance for Solar Choice and other solar advocates say this would double the approximately 10 years it now takes for a Michigan solar system to pay for itself through bill savings.
DTE Energy, Michigan’s dominant electricity provider, argues the NEM policy was created to support solar when it was an emerging technology but solar is now mature and should not get incentives. It also argues that utility-scale solar is more cost-effective than rooftop solar.

Dive Insight:

Nationally, 44 states have NEM, according to the National Conference of State Legislatures.

The recently released Net Metering & Solar Program Report For Calendar Year 2014 from the Michigan Public Service Commission reports there were 1,840 net metered distributed generation owners and 1,947 installations in the state at the end of 2014, representing 14,210 kW. That's 25% more than in 2013, but only 0.015% of Michigan's total retail electric sales.

DTE Energy and Consumers Energy, Michigan’s other major electricity provider, cover 84% of the state’s total net metered capacity.

Michigan’s just completed Thumb Loop transmission system added 1,000 MW of wind to the utilities’ portfolios, helping assure they would achieve the state’s 10% renewables mandate. Its 1,300 MW of additional capacity prepares the state for the proposed 20% renewables by 2022 mandate now before the legislature.

SB 438 is currently before the Energy and Technology Committee in the Michigan Senate. As Utility Dive reported last month, the bill also contains controversial changes to the state's energy choice law and renewables mandate.