SB 437 essentially reestablishes an unhealthy monopoly for the state’s two largest electricity producers, Consumers Energy and DTE by re-asserting a 10% cap on electric choice. In other words, SB 437 requires that 90% of electrical energy consumption must come from DTE and Consumers and only 10% of the market will be allowed to choose their electrical provider. While this isn’t new—Michigan moved away from a more competitive model of electric choice in 2008—it wreaks of crony capitalism at its worst. Our legislators shouldn’t be mandating the continuation of a monopoly. Instead, they should be insisting on a return to a more open electric choice model.
SB 438 will increase the renewable energy mandate for Michigan utilities from 10% to 15% of their electrical production coming from renewable sources (in other words, not coal plants) by 2021. Proponents of the bill say that this is necessary to bring Michigan into compliance with recent changes to renewable energy policy by the Obama administration. However, opponents of the bill say that the mandates (which were already goals for the utilities prior to the introduction of this bill) will substantially increase utility companies’ cost of operations. Additionally, Donald Trump’s recent election to the White House has added another wrinkle to the debate about the cost-versus-benefits of renewable mandates. President-elect Trump said on the campaign trail that he would reverse many of President Obama’s recent renewable energy mandates to get skyrocketing energy costs under control. In light of this, we believe it makes the most sense to wait and see what the new president’s administration will do on energy policy, instead of increasing regulations at the state level that continue to drive up electricity consumers’ bills.