LANSING – Ten percent of the

electricity market would remain set aside for alternative electric suppliers to

the big utilities, but those suppliers would have to meet new requirements and

new regulations would be placed on those customers under the energy legislation

introduced Wednesday by Sen.

Mike Nofs and Sen.

John Proos.

The long-anticipated bills, SB

437* and SB

438*, cover considerable ground. And they came under attack from

environmental groups for not increasing the current renewable energy standard,

which requires utilities to generate 10 percent of all their power from

renewable sources as well as reclassify, in some instances, fossil fuels as

clean energy. The bills also would end the state’s energy optimization program.

As expected, they make no change to

current law that allows up to 10 percent of the electricity market to choose a

utility other than their incumbent provider, such as DTE Energy or Consumers

Energy.

But those alternative suppliers

would have to demonstrate to the Public Service Commission annually that they

can supply enough energy to serve their customers’ peak demand as well as

provide a projection of total peak demand growth plus planning reserve margin

requirements for the next three years or the term of any contract, whichever

was longer.

If the relevant independent system

operator, such as the Midwest Independent System Operator, projected a capacity

shortfall in the supplier’s demand area within the next two years, the

alternative electric supplier would have to demonstrate to the PSC that it can

meet peak demand for the next five years or the term of any contract, whichever

was longer.

If the PSC found the alternative

supplier’s case that it can meet the expected demand insufficient, the

alternative supplier would have 60 days to remedy any problems. If the supplier

failed to do so, the PSC would revoke its license and bar it from providing electric

service in the state for three years.

The bills also would require

utilities to develop integrated resource plans, subject to PSC approval.

Those plans would have to show how

the utility would meet requirements for generation reliability and reserve margins.

Utilities also would have to issue requests for proposals to provide the

electricity needed to serve the utility’s customers and meet reserve margin

requirements. The utility would not be required to grant any of the requests,

but instead would use the information to inform its own operations.

Utilities requesting a certificate

of necessity from the PSC to build a new plant or purchase any existing one

shall include additional information in their integrated resource plan, such as

how much would come from “clean energy resources” and how they plan

to eliminate energy waste.

Clean energy would include a fossil

fuel generation technology in which at least 85 percent of the carbon dioxide

emissions are captured and permanently sequestered or used for other commercial

or industrial purposes that do not result in the release of carbon dioxide into

the atmosphere.

That language disappointed

environmentalists.

“The Nofs energy plan will

result in fewer jobs, higher utility bills and more pollution,” Jack Schmitt,

deputy director of the Michigan League of Conservation Voters, said in a

statement. “It redefines ‘clean energy’ to include burning coal, tires and

other hazardous waste that will increase toxic pollution in the air we breathe

and the water we drink, undermining the success of our state’s clean energy

sector and putting our health at risk.”

“This irresponsible plan is a

massive giveaway to our utility companies that completely dismantles the

progress that Michiganders have made in building a sustainable clean energy

economy,” Mike Berkowitz, legislative and political director for the

Sierra Club Michigan Chapter, said in a statement. “Michiganders have

overwhelmingly expressed time and again that they want our representatives to

make sure that utilities invest in actual clean, renewable energy like wind and

solar that don’t pollute our air and water. Instead, our elected leaders have

chosen to side with corporate polluters.”

This story was published by Gongwer

News Service. To subscribe, click on www.gongwer.com