How Michigan’s new clean energy laws are building a better future

Michigan is making strides towards a cleaner, more sustainable energy future thanks to the Clean Energy and Jobs Act passed in November 2023. Our state’s new energy policies mark a significant departure from the state’s previous energy laws and set ambitious targets aimed at reducing carbon emissions, increasing renewable energy generation, and boosting energy efficiency. 

But how exactly does the Clean Energy and Jobs Act differ from what we already had on the books? 

Moving Michigan to 100% Clean Energy

One of the cornerstones of the Clean Energy and Jobs Act is the expansion of Michigan’s Renewable Energy Standard. Under our new energy laws, Michigan is now on a path to achieve 50% renewable energy by 2030, 60% renewable energy by 2035, and 100% clean energy statewide by 2040. Our new laws also clarify that renewable energy sources will not include industrial waste, polymers, tires, or plastics. To achieve these goals, our new energy laws include requirements for Michigan’s utility companies and increased access to rooftop solar energy. 

These new standards are a huge leap from Michigan’s previous Renewable Energy Standard requirement of just 15% by 2021. The new standards will accelerate Michigan’s transition to 100% clean energy and hold utility companies accountable for getting us there. Under our previous standard of 15% renewable energy by 2021, DTE Energy had voluntarily committed to its standard of 38% by 2030 while Consumers Energy committed to 36% by 2030. By accelerating our transition and locking new, stronger standards into law we are sending a strong signal to entrepreneurs, markets, and decision-makers across the state and nation that Michigan is open for business.

Making Rooftop Solar More Accessible and Investing in Storage

The Clean Energy and Jobs Act increases Michigan’s old and outdated limit on how many Michiganders could generate their own clean energy from rooftop solar. That limit was raised from 1% to 10% of a utility’s energy supply and the law also increased the maximum size of solar projects from 150 kilowatts (kW) to 550 kW. By increasing the cap, more Michiganders will be able to invest in rooftop solar and lower their energy bills by selling excess energy back to utility companies, all while helping Michigan achieve its new energy goals. 

In tandem with Renewable Energy Standard requirements and expanded access to rooftop solar, utility companies will be required to establish 2,500 megawatts (mW) of energy storage by 2029. Through a competitive bidding process established by the Michigan Public Service Commission (MPSC), utilities will be required to increase their energy storage far beyond the current goals set for themselves – DTE had committed to 780 mW by 2035 while Consumers had committed to 550 mW by 2024. Energy storage is critical to the success of clean energy and will greatly improve reliability as we continue to experience the accelerating impacts of the climate crisis. 

Boosting Energy Efficiency

Michigan’s new energy laws include new requirements for utility companies that will increase our energy efficiency for electric and gas utilities. 

Under the Clean Energy and Jobs Act, Michigan will see an increase in electric efficiency standards from 1% to 1.5% for electricity energy waste reduction and an increase in natural gas efficiency standards from 0.75% to 0.875% for gas energy waste reduction by 2026. These new requirements also include incentives for major utilities that achieve 2% electricity energy waste reduction and 1.25% natural gas energy waste reduction. The new requirements and incentives will help ensure utilities run effective, sustainable energy efficiency programs across the state.  

The Clean Energy and Jobs Act also requires natural gas providers to prioritize “deep” energy retrofits, such as building weatherization and insulation. With these retrofits, we will reduce the amount of energy needed to heat our homes and businesses, in turn, saving us money.

Lowering costs for disadvantaged communities

Importantly, our new laws create programs for energy efficiency programs in low-income communities, which will help address home health and safety improvements in underserved and marginalized communities. These purposeful investments will fix a long-standing problem in Michigan’s bigger cities, where low-income housing has often been considered too dilapidated or outdated to receive energy efficiency upgrades. 

By requiring energy efficiency upgrades to be directed to multi-family households and Michiganders living in environmental justice communities, our new energy laws will help ensure equitable access to energy efficiency programs and good-paying jobs. In fact, the Clean Energy and Jobs Act requires utility companies with more than 50,000 customers to hire and train a diverse workforce for their energy waste reduction programs so Michiganders and communities most impacted can directly benefit from employment opportunities and career paths in the building trades.

Through setting higher standards and prioritizing equity and inclusivity, the Clean Energy and Jobs Act is laying the groundwork for a more sustainable and resilient energy future. 

Promoting Environmental Justice and Public Health

The Clean Energy and Jobs Act requires the Michigan Public Service Commission (MPSC) to prioritize environmental quality, public health, and equity in utility companies’ long-term energy plans, which is a step in the right direction to holding utility companies accountable.

Before the Clean Energy and Jobs Act, Michigan did not have any laws to help state regulators prioritize environmental justice or public health in decision-making. For the first time, the MPSC will be required to consider the impact of energy policy and utility companies’ energy plans on environmental justice, public health, and the health of our environment. 

Increased funding will be available for attorney general intervention and utility customer representation for residential customers and communities. Additionally, there are requirements for more public engagement and participation, particularly in low-income and environmental justice communities to give more Michiganders a seat at the table when it comes to energy decisions in their communities. The MPSC will also be required to host at least four public meetings each year in locations that allow easy participation for low-income customers to enhance procedural justice and transparency. 

Although not perfect, the new requirements for the MPSC will help increase public engagement in the regulatory process for utility companies and energy planning. By helping more Michiganders from low-income and environmental justice communities get a seat at the table, the MPSC will have more information to understand how our communities are impacted by energy policy and hold utility companies accountable for doing their part. 

Supporting Michigan Workers in the Transition to Clean Energy 

Michigan’s transition to 100% renewable energy will bring new businesses to our state and create thousands of good-paying jobs. But to fully capitalize on unprecedented job creation and economic growth, we must support Michigan workers. 

That’s why the Clean Energy and Jobs Act established the brand new Office of Community and Worker Economic Transition within the Michigan Department of Labor and Economic Opportunity. It also creates the Community and Worker Economic Transition Fund within the Michigan Treasury. 

Michigan has long been a hub for industry and manufacturing, and countless Michiganders have critical skills that will be applicable to infrastructure development. From welders to pipefitters to electricians, we will need skilled trades workers to achieve our clean energy goals. 

As part of its duties, the Office of Community and Worker Economic Transition will be required to develop and submit a transition plan to the governor and legislature by the end of 2025. This plan will detail specifically how the new office will allocate resources and programming to ensure Michigan workers can access job opportunities and be prepared to hit the ground running. The office will also be required to align local, state, and federal resources to invest in communities and workers whose previous jobs and industries are most impacted by the transition to renewable energy. 

With the funding necessary, the new office will ensure Michigan workers and communities benefit from historic clean energy job creation and economic growth as we invest and build out new clean energy infrastructure. 

Building our Clean Energy Economy the “Michigan Way” 

With our manufacturing history, Michigan is a hub for the labor movement. However, the clean energy industry and labor have not always seen eye to eye. The Clean Energy and Jobs Act makes sure the clean energy boom is done the Michigan way with good-paying union jobs. 

All large-scale renewable energy projects are required to have project labor agreements and pay a prevailing wage to make sure the jobs we are creating right here pay good wages that you can raise a family on. The Clean Energy and Jobs Act makes sure new clean energy jobs that come to Michigan pay good wages with union labor. 

Historic Clean Energy Policies are Coming to Michigan

Though it’s just the beginning, the Clean Energy and Jobs Act represents Michigan’s most comprehensive and ambitious effort to date to transform Michigan’s energy landscape towards sustainability, equity, and climate resilience. By advancing renewable energy deployment, enhancing energy efficiency standards, and promoting environmental justice, Michigan is poised to be a national leader in the transition to a cleaner and more prosperous future.