Michigan House passes climate change reform, mandating clean energy by 2040

• The House has approved sweeping energy reforms designed to push utilities toward renewable energy
• The centerpiece is a requirement for utilities to get 100 percent of their energy from state-approved clean sources by 2040
• The Senate, which approved earlier versions of the package, must revisit several bills before they head to Gov. Gretchen Whitmer

LANSING — The Michigan House early Friday morning approved a suite of reforms to address climate change that would fundamentally change how the state gets its energy and require utilities to draw all their power from clean sources by 2040. 

Working late into the night, the measures were approved along party lines, with pleas from Democrats that changes are long overdue and opposition from Republicans who argue the timeline will hurt reliability and increase rates.

“It's time that Michigan does its part to address climate change,” said Rep. Jenn Hill, D-Marquette, who called climate change “an immediate threat to the wellbeing and economic prosperity of our state.”

Republicans contend the transition mandated by Senate Bill 271 is too abrupt and swapping fossil fuels too quickly for alternatives like wind and solar energy will lead to trouble.

“For this legislation to make sense, not only would the technology have to improve, but Michigan would also have to become a windy, sunny place,” said Rep. Andrew Fink, R-Hillsdale.

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The package also includes legislation that would shift permitting control over large wind and solar arrays from local governments to the state. Those bills passed the House overnight and will head to the Senate for consideration.

The reforms are the most significant since a 2016 state energy overhaul, and they moved through the House in only a week as Democrats rush to pass legislation while they still maintain a two-seat majority. Two Democrats, Kevin Coleman and Lori Stone are running for mayor in Westland and Warren, respectively, on Tuesday. If either wins, the House is likely to recess for the year.

The Senate, which approved earlier versions of the package, must revisit several bills amended by the House before they head to Gov. Gretchen Whitmer. In 2020, the governor set a goal for Michigan to become carbon neutral by midcentury and has repeatedly called for legislation to support that goal. She is expected to sign the climate bills if they reach her desk.

The bills faced criticism from some environmental groups who accused Democratic sponsors of kowtowing to lobbyists by changing the deadline from 2035, allowing utilities to seek extensions and defining things like landfill gas and incinerated waste as renewable energy. 

“We wanted to ensure that there were sufficient points of contact between (state regulators) and the utility,” Sen. Sam Singh, D-East Lansing and a sponsor of the package, said Wednesday. “That if there were concerns about meeting some of these goals ... there were off ramps.”

Under the new language, regulated utilities would have until 2027 to get 15 percent of their energy from renewable sources — a term that includes energy derived from manure and landfill methane, with a narrow carve-out for some incinerated waste. 

The requirement would gradually increase to 60 percent by 2035. 

Starting in 2035, electricity providers would have to get 80 percent of their energy from sources the bill deems to be clean, including renewables, nuclear and natural gas with carbon capture. Utilities would need to reach 100 percent clean energy by 2040.

If they struggle to meet those deadlines, the Michigan Public Service Commission could grant “good cause” exemptions of up to two years apiece. 

Many Democrats and environmental groups lauded the bills.

“Passing this legislation solidifies Michigan as a national clean energy leader and is a crucial first step toward cleaner air, cleaner water and more affordable electricity bills for Michiganders,” said Derrell Slaughter, a state clean energy advocate with the Natural Resources Defense Council.

Nick Occhipinti, government affairs director for the Michigan League of Conservation Voters, echoed the sentiment.

“After a summer of smoke-reddened skies choking the air, waves of outages and news of climate-driven tragedies from all over the country and our world, the time to act has never been more clear or more urgent,” he said.

The bills were revised during weeks of closed-door negotiations this fall, before new versions were publicly released and voted out of both chambers within about a week.

Environmental justice groups argued the new 2040 deadline is not fast enough, and panned waste incineration and carbon capture as “loopholes” that allow utilities to continue burning fossil fuels. 

Ahmina Maxey, executive director of the Michigan Environmental Justice Coalition, called that “a betrayal of Black, Brown, Indigenous and frontline communities throughout Michigan who for generations have contended with the worst effects of climate change and pollution.”

Republicans, meanwhile, said they’re skeptical of Democratic vows that the legislation will not raise energy rates or make Michigan vulnerable to outages during cloudy, still days when solar panels and wind turbines don’t generate much power. During a committee hearing Wednesday, they attempted to add a host of amendments, including several that would suspend the legislation if rates increase too much. None passed.

Rep. Pauline Wendzel, R-Bainbridge Township, called the energy package a “brown-out bundle.” 

Michigan’s two largest utilities, Consumers Energy and DTE Energy, are neutral on the clean-energy mandate. Both had already committed to carbon neutrality by mid-century — 2040 in Consumers’ case and 2050 in DTE’s case. 

Other bills in the package are: 

• House Bills 5120-23 to give the state permitting authority over large-scale renewable energy projects, wresting control from local governments that are often hostile to the projects.
• Senate Bill 273, which would require utilities to boost their energy-efficiency savings — such as energy saved by helping customers replace outdated lightbulbs and appliances —  from 1 percent to 1.5 percent. 
• Senate Bill 502 to expand the scope of the Michigan Public Service Commission, requiring commissioners to prioritize new goals including service quality, affordability, cost-effectiveness and equitable access. 
• Senate Bill 519 to create an office in the Department of Labor and Economic Opportunity which would help assist and retrain automotive and energy workers whose jobs will be replaced as industries shift from gas-powered vehicles and coal plants to EVs and renewable energy. 
• Senate Bill 277 to codify an existing state rule allowing farmers to rent their land for solar arrays while staying enrolled in the state’s farmland preservation program.