- Associated Press - Tuesday, October 25, 2016

LANSING, Mich. (AP) - A key business group’s endorsement is being touted as the “breakthrough” needed to update Michigan energy laws before the legislative session expires in two months.

The Michigan Chamber of Commerce, whose members have been at odds over provisions governing competition in the electricity market, said Tuesday it supports new versions of bills that are pending in the Senate. The Republican-controlled chamber is expected to approve the legislation two days after the Nov. 8 election, and the business lobby is hopeful the GOP-led House will follow suit in the “lame-duck” session so the issue is resolved before new lawmakers take office in January.

The rewrite of 2008 energy laws is one of Republican Gov. Rick Snyder’s top legislative priorities. It has been more than 17 months since he outlined proposals to lawmakers.

“This proposed substitute is substantially different. It is a dramatic improvement over the bill that was reported out of committee” in May, Chamber President and CEO Rich Studley told reporters during a briefing that was also attended by two senators sponsoring the legislation and an adviser for a nonprofit connected to Michigan’s two major utilities, DTE Energy and Consumers Energy. Changes that would ease utility competitors’ ability to submit bids to provide new power were a “very important breakthrough for us,” Studley said.

Under current law, electric providers had to produce 10 percent of their power from renewable sources by the end of 2015. The bills would raise the minimum to 15 percent by the end of 2021 - a significant change geared to gain Democrats’ backing - and set a non-binding goal of meeting 35 percent of Michigan’s electricity needs by 2025 through a combination of renewable energy and energy conservation.

A separate requirement that utilities save a minimum amount of power each year with efficiency programs would be extended through 2020, after which companies could receive incentives to continue their conservation efforts.

Senate Energy and Technology Committee Chairman Mike Nofs, R-Battle Creek, said the legislation would keep intact a “hybrid” system that guarantees DTE, Consumers and smaller utilities 90 percent of power sales in their regions and gives competitors up to 10 percent of the market. Existing “choice” customers could exceed the cap when expanding their existing business operations.

Despite the chamber’s announcement, a coalition of alternative suppliers and their customers said it remains opposed to the legislation. Energy Choice Now spokeswoman Maureen Saxton said the “compromise” has “poisons pills” that would effectively kill choice, especially if a capacity agreement recently worked out between the Snyder administration and a regional transmission organization is not approved.

“There is no competitive bidding,” she said. “They limit participation to companies with 200 megawatts of non-renewable generation in Michigan. That is no more than five to six companies. They exclude the hundreds of companies who build plants across the country and the world.”

The bills also would mirror the Michigan Public Service Commission’s request that DTE and Consumers offer time-of-day rates and dynamic pricing so customers are encouraged to use less power in times of peak demand - doing laundry at night, for example - to reduce costs for all ratepayers. Commissioners have directed DTE to make the option available to all customers who have had a “smart” meter for at least a year. Consumers is expected to offer the rate structures by 2017.

Efficiency advocates are continuing to lobby the Legislature for automatic enrollment of customers in the pricing structure so it is an opt-out system.

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Online:

Senate Bills 437-38: http://bit.ly/2fdaxb1

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Follow David Eggert on Twitter at http://twitter.com/DavidEggert00 . His work can be found at http://bigstory.ap.org/author/david-eggert

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