The senate-sponsored bill would enable residents and businesses to subscribe to offsite solar projects to receive a credit on their utility bills.
A bipartisan coalition led by Michigan Senators Jeff Irwin (D-Ann Arbor) and Ed McBroom (R-Waucedah Township) introduced Senate Bills 152 and 153 to enable a statewide community solar market.
The bill would create a pathway for residents and businesses in Michigan to subscribe to a portion of capacity of off-site solar facilities. Production of the facility would be credited to a customer’s utility bill.
“Solar energy brings a lot of economic and environmental benefits, but not everyone is able to build their own solar array,” Sen. Irwin said. “These bills give people, organizations, and businesses the option to participate in affordable renewable energy generation in their own communities.”
From 2020-22, the average monthly residential electricity bill in Michigan increased by more than 15%, according to the Energy Information Administration. Some Michigan homeowners can lower their energy bills by installing their own solar panels, but more than 50% of households cannot access solar due to financial barriers, roof limitations or property ownership, said Irwin’s office. Under this legislation, residents can subscribe to community solar projects.
“These small-scale, local solar projects will be particularly useful to residents, providing an opportunity to independently produce energy for themselves and their neighbors, and providing savings on energy bills for those who subscribe,” said Sen. McBroom.
Community solar projects would be limited to 5 MW of maximum nameplate capacity. The program would enable homeowners, small businesses, government buildings, schools, and churches to share a solar facility’s capacity. These arrays are often built on small parcels of underutilized farmland, but can also be built on large commercial rooftops, parking lots, brownfields or reclaimed mining lands.
Michigan performs worse than the U.S. average in terms of hours of electric service interruption and the number of interruptions, according to a report by Local Solar for All. More than a quarter million Michiganders went without electricity for six hours in August 2022 due to grid failures started by inclement weather. Equipment failures left Ann Arbor in the dark for six hours on February 1, 2023, disrupting university and municipal operations.
The Local Solar for All report found that interruptions in service led to just under $5 billion in losses throughout 2020 and 2021. Local community solar offers a solution as electricity is generated close to where it’s needed and can provide homes and small businesses power even during demand spikes and widespread outages.
Local Solar for All released a roadmap in 2020 for distributed solar and storage adoption. It found that distributed clean energy like local solar could provide energy consumers nationwide as much as $473 billion by 2050 as part of the clean energy transition that is already underway.
In Michigan, Vote Solar for All modeled that ratepayers would experience direct benefits of $379,966 annually from local solar and storage expansion. The roadmap also showed that a clean electric grid that leverages local solar and battery storage can be $88 billion less expensive to run across the country than today’s centralized grid.
Utility DTE Energy proposed a $7 billion, five-year grid investment plan in November 2021. Consumers Energy also filed its own grid investment plan in 2021, which includes $5.4 billion in investments over five years. This $12.4 billion in spending is passed to consumers in the form of rate raises. Community solar may offer a more cost-effective and reliable electricity grid for Michigan.
