Michigan Public Service Commission Decision Creates Barriers to Rooftop Solar in Michigan

The Michigan Energy Innovation Business Council  expressed concerns over changes to the current net metering program announced today by the Michigan Public Service Commission, which will significantly reduce compensation residents receive for generating energy from rooftop solar. The Commission announced an order establishing a billing structure for rooftop solar that charges residents the retail rate for the energy they buy, but uses the utility company’s avoided cost as compensation for the energy they sell back to the grid.

“We are deeply disappointed with the Commission’s order today that severely undervalues clean energy generated from rooftop solar,” said Liesl Clark, president of the Michigan Energy Innovation Business Council. “Today’s decision will have a chilling effect on Michigan’s rooftop solar market, which has steadily created jobs and provided a way for Michiganders to reduce their electricity bills.”

Under bipartisan energy laws passed in 2016, the Legislature directed the MPSC to re-evaluate the compensation residents receive from utility companies for generating their own energy by conducting a study on the cost of service. The Commission did not complete a robust and thorough cost of service study leading up to this order. Today’s order will significantly extend the time it takes to pay back up-front costs for installing rooftop solar, undermining Michigan’s growing residential solar industry.

“The 2016 energy law requires the Commission to conduct a robust cost of service study, and that didn’t happen,” said Clark. “The Commission’s order contradicts the 2016 energy law and will result in uncertainty for the future of Michigan’s rooftop solar industry.”

The changes to net-metering will go into effect in any rate cases utility companies file after June, 2018.