The Michigan Public Service Commission on Sept. 11 approved a settlement between Consumers Energy Co. and dozens of small solar energy providers that complained the company was violating a federal law that requires utilities to purchase electric output from small, independent power producers.
Under the settlement with more than 40 solar energy companies and other parties, the CMS Energy Corp. subsidiary committed to make "commercially reasonable" efforts to purchase and interconnect 584 MW of solar energy projects by Sept. 1, 2023. Consumers Energy agreed to interconnect a minimum of 150 MW of the small solar projects per year. (Michigan PSC Case No. U-20615)
The small solar providers had filed complaints to the PSC alleging Consumers Energy was violating the Public Utility Regulatory Policies Act. The federal law requires power companies to buy the electric output from "qualifying facilities," as defined by the law. Included in that definition is small power production facilities that generate 80 MW or less, and whose primary source of power is renewable energy, biomass, waste or geothermal resources.
The law requires utilities to purchase the facilities' output at an avoided cost rate, or the rate it would have had to pay by building its own power plants to generate the same amount of power. In June, regulators approved Consumers Energy's integrated resource plan, which modifies rates and terms Consumers Energy will offer to qualifying facilities.
Consumers Energy had said that some 3,500 MW of such projects were in its interconnection queue, and the sheer quantity made it difficult to process the applications in a timely fashion.
Under the settlement, Consumers will award 170 MW to qualifying facilities of 20 MW or smaller that were in the company's interconnection queue as of June 7 at the full avoided cost rate. Of that amount, Sustainable Power Group LLC, known as sPower, will be entitled to 75 MW, Geronimo Energy LLC will be entitled to 40 MW, and Cypress Creek Renewables LLC will be entitled to 20 MW. After that capacity is awarded, another 414 MW will be awarded to projects of 20 MW or smaller at the energy plus Midcontinent ISO planning reserve auction rate. The capacity will be allocated proportionally among qualifying facilities in the interconnection queue in three date ranges between Jan. 1, 2017, and June 7, 2019. This resolves complaints brought by these and other solar developers. (PSC Case Nos. U-20500, U-20516, U-20558, U-20565, U-20575)
Consumers Energy in March reached an agreement with regulators to eliminate coal-fired power by 2040 and add more than 5,000 MW solar energy by 2030.
