This coverage is made possible through a partnership with Grist and Interlochen Public Radio in Northern Michigan.
Last year, Michigan had one of the latest states to adopt a clean energy standard, beyond sweeping legislation which requires utilities there to use 100 percent clean electricity by 2040 and sets targets for renewable energy development, among other things.
Now, it is rolling out those laws. And the Michigan Public Service Commission, the energy regulators responsible for that rollout, must pay special attention to the Upper Peninsula. The commission has until December 1 to recommend whether – and how – the legislation should be adjusted to accommodate its people, businesses and utilities.
They had their work cut out for them: The Upper Peninsula, commonly known as the UP, is a large, sparsely populated region in the north, separated from the rest of the state by the Straits of Mackinac and sandwiched between Lake Superior , Michigan and Huron. The UP has many utilities for its small population of just over 300,000, which requires a higher level of cooperation between them. On top of that was the grill building with power-hogging industries such as mining and paper mills in mind, and fluctuating industrial demand has meant that people living in the region have faced high costs over the years. Some utilities charge resident rates that are among the highest in the country Michigan and the country.
And the Public Service Commission must ensure that the natural gas plants it approved in 2017 as a cleaner alternative to coal does not prevent Michigan from meeting its clean energy goals.
Those natural gas plants are powered by reciprocating internal combustion engines, called RICE units, which went online just five years ago and are built to last for decades — that is, beyond the state’s 2040 clean energy goal. While mining company Cleveland-Cliffs agreed to pay half of the $277 million price tag, the rest of the cost was passed on to more than 42,000 utility customers.
Michigan’s new energy laws specifically mention UP’s expensive new natural gas engines as an obstacle and asks the Public Service Commission to figure out what to do.
The laws do not require the engines to be turned off completely. But they only consider natural gas paired with carbon capture to be “clean,” so the utility that runs the engines will instead have to deploy a lot of renewable energy or find some other way to comply with the new rules. What all this means for the future of the five-year-old engines is uncertain.
Dan Scripps, chairman of the commission, said the state could adjust its approach to the RICE units by reducing or offsetting emissions. Another option, he said, would be to think holistically about the region’s energy goals: “How do you effectively get to net-zero carbon emissions by 2040, but maybe with more flexibility around carbon capture and that sort of thing?”
The commission juggles many opinions.
Mine officials and employees spoke in favor of continuing to operate the RICE units at a public hearing held by the commission this summer.
Ryan Korpela, the general manager of Cleveland-Cliffs’ Tilden mine, asked commissioners to allow the natural gas engines to operate without requiring renewable energy credits or new power generation, calling it “the perfect solution to a difficult problem ,” noting that taxpayers are already footing the bill.
Officials with Cleveland-Cliffs say that the engines are cleaner and more efficient than coal, saving customers money on transmission costs. But organizations like the Sierra Club have pronounced against installing it in places like neighboring Wisconsin, arguing that it burns methane — the main component of natural gas — harms both the climate and the people who live next to the plants. The climate think tank RMI say very comparisons of coal and gas only considers end-use emissions and does not account for methane leakages during production and transport. According to an RMI analysis published last year, those leaks could put the climate impact of natural gas on par with coal (when released into the atmosphere, methane is about 80 times as potent as carbon dioxide).
The utility that operates the RICE units, Upper Michigan Energy Resources Corporation, is working to deploy renewable energy, spokesman Brendan Conway said in an email, but they are balancing that with an immediate need for reliable energy: “These units serve that critical function in a part of the state with limited transmission access.”
Others, including environmental and energy groups, have pressed to implement state laws as written, including the clean energy mandate.
Abby Wallace, a member of the Michigan Environmental Council, wants to find a compromise on the natural gas engines. “There are ways in which the RICE units themselves can be made more efficient. And I think it is premature to say that the UP could in no way achieve the goals to which the rest of the state is held in the legislation,” she said during the hearing.
Across the country, four states have 100 percent renewable portfolio standards, while 16 states have adopted broader 100 percent clean electricity standards, according to Lawrence Berkeley National Laboratory’s August report. (Clean energy includes a wider range of technologies than renewables, so that number doesn’t include states like Vermont, which has a renewable energy standard introduced into legislation earlier this year.)
Galen Barbose, a staff scientist who wrote the report, said Michigan’s goals are quite ambitious.
“Most other 100 percent states have targets that are further out in time,” he said. “By setting that 100 percent target for 2040, Michigan is one of the more aggressive states in terms of the timeline.” It is also approaching the transition more incrementally than some other states, Barbose said, aiming to get 80 percent of its energy from clean sources by 2035.
In the background of Michigan’s energy transition looms the instability of the electric grid, which could have serious consequences for the people who live in the UP.
“A squirrel sneezes and the power goes out,” Tori McGeshick said, describing how some locals see reliability there. McGeshick is a member of the Lac Vieux Desert Band of Lake Superior Chippewa Indians who now live across the border in northern Wisconsin. She works as the tribe’s climate resilience coordinator.
Utilities often take longer to respond to power outages in more remote areas, she said, and unreliable power has had a profound effect on her community, especially older people and people with specific medical needs.
“It also affects our harvesting rights,” McGeshick told Grist. “A lot of people harvest or hunt or fish during the different seasons, and when there’s a power outage, all of that — stock — is lost, too.” She added that the Public Service Commission should seek more tribal input as it weighs the new legislation against the infrastructure, cost and reliability of the network.
Not everyone agrees that natural gas is a long-term solution for reliable, affordable energy. Roman Sidortsov, an associate professor of energy policy at Michigan Technological University, said gas prices are volatile and difficult to predict. “People tend to forget that fossil fuels, and especially oil and gas – this is an incredibly volatile business,” he said. “There is very little stability in the prices.”
Sidortsov, who was a member of the state UP Energy Task Force several years ago, said UP deals with different environmental factors and clients than the rest of the state; the grid is built to serve industries that are not as robust as they once were.
He thinks much of the region’s demand can be met with distributed generation — getting power from smaller, more localized energy sources, something energy experts have discuss for years. Sidortsov said the right way forward is to develop the grid’s capacity for energy storage and smaller, distributed renewables.
“So when we talk about achieving the goals set by the Legislature, it will probably be necessary to reconsider the timetable in the UP, update the timetable in the UP, to make sure that it includes local solutions and can accommodate distributed solutions.”
Michigan has become a leader among the states working toward an all-clean energy standard, said Douglas Jester, a managing partner at the policy consulting firm 5 Lakes Energy who helped develop the state’s laws.
And while the clean energy standard still allows utilities to sell some fossil fuel power back to the grid, it may not make financial sense by 2040, Jester said, as nearby states increasingly turn to renewable energy.
This reporting was supported by the Institute of Journalism and Natural Resources.
Editor’s note: Sierra Club is an advertiser with Grist. Advertisers play no role in Grist’s editorial decisions.
