Rep. Glenn: ‘Illegal’ MPSC ruling highlights need for reform

Rep. Gary Glenn, chair of the House Energy Policy Committee, today said he will consider proposals to reform the Michigan Public Service Commission in the aftermath of a ruling he said violates the intent of state law and could raise costs for utility customers.

The committee heard testimony related to last week’s MPSC ruling that Glenn said threatens to undermine Michigan’s electric choice program, which has saved millions of dollars for schools, businesses and residents across the state.

“Unaccountable, unelected bureaucrats are attempting to dismantle an energy law adopted for the people by their representatives in the Legislature,” Glenn said. “We cannot allow this action, which I consider to be illegal under the new state law. It is one of the reasons we intend to come forward with multiple proposals for broad-based reform for the MPSC.”

Those reforms could include adding to the MPSC’s current three-commissioner format to include more representation for ratepayers, qualification requirements for commissioners, stronger protections against conflicts of interest and other improvements to better serve Michigan, Glenn said.

Glenn, R-Williams Township, said the reform proposal will be separate from one already in the works to overturn last week’s MPSC ruling related to in-state power generation requirements.

The MPSC is drafting rules to implement new state energy laws approved late last year. Friday, the utility regulator outlined plans to require alternative energy suppliers who compete with Michigan’s electricity monopolies – Consumers Energy and Detroit Edison – to prove they can supply their customers using electricity generated in Michigan.

While some specifics have not yet been decided, Glenn said the in-state electricity could be far more expensive than if it were generated elsewhere, driving up utility costs for schools, residents and businesses in electric choice programs.
Glenn said lawmakers clearly removed the in-state generation requirement from the new energy law before it was finalized. He disagreed with testimony today from MPSC chair Sally Talberg.

“If that language had not been removed, the Legislature never would have approved the new state law in the first place,” Glenn said. “It was a key compromise to ensure its passage. It seems that everybody knew what the compromise was except the MPSC.”

As stated in a letter this summer to the MPSC from state Reps. Chris Afendoulis and Rob VerHeulen, the final language in Michigan’s new energy law “clearly allows” alternative energy suppliers to use any resource allowed by the Midwest’s federally regulated regional electricity grid manager “to meet capacity obligations without reference to local resources.” The legislators wrote they believe the MPSC’s requirement would be “contrary to the legislative intent and final compromise” of the new energy law.

Schools and business groups are among those supporting Glenn’s position.
The Michigan Chemistry Council and the Grand Rapids Area Chamber of Commerce testified in the Energy Policy Committee earlier this month in support of his position. Others who have sent letters to the MPSC sharing Glenn’s view include the Michigan Chamber of Commerce and the Association of Business Advocating Tariff Equity – a group of major manufacturers including Dow Chemical Company, Hemlock Semiconductor, General Motors, Marathon Petroleum, Pfizer Pharmaceuticals and U.S. Steel.

In a July letter to the MPSC, the Michigan Schools Energy Cooperative said its electricity choice program has saved participating Michigan schools over $140 million – or $35 per student per year. That is money returned directly to the classroom.

“This fight is not over,” Glenn said of the efforts to preserve electric choice in Michigan. “This fight is too important to be over.”