Public Service Commission missed the mark with distributed generation order

LANSING – The Michigan Conservative Energy Forum (MCEF) issued the following statement in response to the Michigan Public Service Commission’s (MPSC) recent order that changes how residents are compensated for electricity generated through solar. The order establishes a billing system in which residents with solar buy energy from the grid at their utility company’s retail rate, but must sell energy they generate themselves back to the utility at a lower rate based on the utility company’s avoided cost:

“The billing system established by the MPSC for distributed generation (DG) customers is not in compliance with Public Act 341 of 2016. Rather than complete an outflow cost of service study to establish a DG tariff as required by the legislature in Subsection 6a (14) of PA 341, the MPSC staff instead presented a cost of service study on the inflow portion alone, rejecting the policy established by elected officials. MCEF is dismayed by the indefensible action taken today by the Commission, and frustrated that the MPSC ignored the input of so many stakeholders in the work group. The order reflects a capricious lack of respect for the law and demonstrates just how much sway the utilities have over their own regulators. It is the responsibility of the MPSC to implement the law as written, not establish policy of its own choosing.

“The Commission made significant changes to the current net metering program that will effectively undermine solar in Michigan. This is about more than renewable energy – it’s about an individual’s right to produce electricity on their own private property. Who is looking out for the ratepayer if not the MPSC? Distributed generation benefits us all in the form of better reliability and grid security. Residents who want to be more energy independent and generate their own electricity should receive a fair and equitable rate for the energy they provide to the grid – today’s order by the Public Service Commission ensures just the opposite. As a result, solar energy will be much less cost-effective for Michigan residents seeking to reduce their electricity bills by generating their own energy.”


About MCEF: The Michigan Conservative Energy Forum is an organization comprised of conservatives who believe that Michigan should adopt a true “All of the Above” energy policy that includes an increase in our commitment to renewable energy and energy efficiency.  MCEF believes encouraging diverse and clean energy production and reduced energy waste will create jobs and stimulate Michigan’s economy, reduce our reliance on foreign energy, improve our national security, and protect our valuable natural resources.