Energy developers unclear of role as Consumers plans major shift toward solar
Questions remain over the role for third-party developers planning billions of dollars in solar investment across the state. As the cost of solar continues to decline, companies see opportunity to develop utility-scale projects in Michigan under the federal Public Utility Regulatory Policies Act of 1978, or PURPA. Under the law, utilities are required to purchase renewable energy from third parties if it can be done at cost or cheaper than what the utility would pay to do it itself, which is known as the avoided cost.
Most PURPA contracts in Michigan are for hydroelectric, landfill gas or biomass projects, but developers see solar as the next frontier in the state. Here and in other states, though, utilities have challenged the cost of those projects in ways that critics say make them uneconomical for developers.
Since Consumers filed its IRP in mid June, developers and their trade groups are uncertain at best on the issue, while others are concerned they will be shut out from utility-scale projects.