Michigan Governor Seeks to Raise Renewable Energy Mandate

Published June 25, 2013

Michigan Governor Rick Snyder announced he wants to increase the state’s renewable energy mandate, a 2008 law that requires utilities to produce at least 10 percent of their electricity from renewable sources by 2015.

Voters Rejected Increase
A ballot initiative last year would have raised that standard to 25 percent by 2025, but Michigan voters rejected it. Snyder campaigned against the proposal, but now he says he would like the Michigan legislature to increase the standard.

Snyder claims power companies are in position to meet the 10 percent goal by 2015. That being the case, Snyder said, the legislature should gather information and consider tightening the mandate still further in the near future.

Paying the Price for Renewables
U.S. Energy Information Administration (EIA) data show Michigan’s electricity prices have risen 23 percent since 2008, when the state legislature imposed its renewable power mandate. By comparison, EIA reports electricity prices at the national level have risen merely 1 percent since 2008.

Further tightening Michigan’s renewable power mandate will likely lead to even steeper electricity rate hikes. When a state constructs its first renewable energy facilities to comply with a renewable energy mandate, energy providers pick the locations with the most prevalent winds, sunshine, or other qualifying factors for power production. With each incremental tightening of the renewable power mandate, power companies must develop power sources that are increasingly ill-suited for power production. 

Energy prices have remained flat at the national level because new natural gas discoveries and production technologies have brought immense new quantities of natural gas to the market at relatively low prices. Michigan has the largest natural gas reserves in the Great Lakes region, but the state’s renewable power mandate is limiting state residents’ ability to take advantage of this affordable and environmentally friendly resource.