MPSC Issues Annual Report on Renewable Energy, Michigan Poised to

Hit 10 Percent Target This Year

Contact: Judy Palnau, 517-284-8300
Agency: Michigan Public Service Commission
February 13, 2015 - The Michigan Public Service Commission (MPSC) today issued its fifth
annual report on the implementation of the state's renewable energy standard and its cost
effectiveness. Public Act 295 of 2008 (PA 295) requires the report to be issued by Feb. 15 each
year.
For 2013, the estimated renewable energy percentage reached 7.8 percent, up from 5.4 percent in
2012. For 2014, renewables are expected to have reached 8.1 percent.
"By the end of the year, Michigan will have reached its renewable energy portfolio standard (RPS) 10 percent by 2015," said MPSC Chairman John D. Quackenbush. "The RPS can be credited with
over 1,450 megawatts (MW) of new renewable energy projects becoming commercially operational
since PA 295 took effect."
Highlights of the report include the following:

Michigan's electric providers are on track to meet the 10 percent renewable energy
requirement.
All of Michigan's electric providers accomplished the second compliance requirement
successfully for 2013.
At the end of 2013, both Consumers Energy and DTE Electric obtained MPSC approval of
power purchase agreements and company-owned renewable energy projects that provide
the necessary capacity to exceed the 2015 legislative capacity requirements.
In July 2014, Consumers Energy reduced its renewable energy surcharge to zero for all
customers. In January 2014, DTE Electric company implemented a surcharge reduction,
which lowered the residential surcharge from $3 per meter per month to 43 cents.
At the end of 2014, there were over 1,500 MW of utility-scale wind projects in operation in
Michigan. (This includes 127 MW of utility-scale projects that began operating prior to the
Act.)
During 2014, five utility-scale wind farms became commercially operational in Michigan.
The growth of wind in Michigan's REC portfolio has been significant, increasing from 24
percent in 2012 to 44 percent in 2014.
The most recent contracts approved by the MPSC for new wind capacity have levelized
costs in the lower $50s per MWh ranges, about 10 percent less than the cheapest levelized
contract prices from 2011, and 50 percent of the levelized cost of the first few renewable
energy contracts approved in 2009 and 2010.
The weighted average price of existing renewable energy contracts is $76.55 per megawatthour (MWh), significantly lower than the cost of coal-fired generation plants.

On a combined basis (renewable energy and energy optimization), the cost of $37 per MWh
is less than any new generation, including new natural gas combined cycle plants, when
compared to the Energy Information Administration levelized plant costs for 2014.
Some $2.9 billion has been invested to bring approximately 1,450 MW of new renewable
energy projects online through 2014 in Michigan.

The entire report is available online, here.

The MPSC is an agency within the Department of Licensing and Regulatory Affairs.
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