Bill Text: MI HB4759 | 2023-2024 | 102nd Legislature | Introduced
Bill Title: Energy: alternative sources; renewable energy standard; increase, and establish a carbon-free energy standard. Amends title & heading to subpt. A, art 2 & secs. 1, 3, 7, 9, 11, 22, 28, 29, 45, 47 & 49 of 2008 PA 295 (MCL 460.1001 et seq.) & adds secs. 32, 34, 50, 51, 52 & 53.
Spectrum: Partisan Bill (Democrat 34-0)
Status: (Introduced) 2023-06-15 - Bill Electronically Reproduced 06/15/2023 [HB4759 Detail]
Download: Michigan-2023-HB4759-Introduced.html
HOUSE BILL NO. 4759
A bill to amend 2008 PA 295, entitled
"Clean and renewable energy and energy waste reduction act,"
by amending the title, the heading to subpart A of part 2, and sections 1, 3, 7, 9, 11, 22, 28, 29, 45, 47, and 49 (MCL 460.1001, 460.1003, 460.1007, 460.1009, 460.1011, 460.1022, 460.1028, 460.1029, 460.1045, 460.1047, and 460.1049), the title and sections 1, 3, 7, 9, 11, 29, 45, 47, and 49 as amended and sections 22 and 28 as added by 2016 PA 342, and by adding sections 32, 34, 50, 51, 52, and 53.
the people of the state of michigan enact:
An act to require certain providers of electric service to establish and recover costs for renewable energy and carbon-free energy programs; to require certain providers of electric or natural gas service to establish and recover costs for energy waste reduction programs; to authorize the use of certain energy systems to meet the requirements of those programs; to provide for the approval of energy waste reduction service companies; to reduce energy waste by state agencies and the public; to create a wind energy resource zone board and provide for its power and duties; to authorize the creation and implementation of wind energy resource zones; to provide for expedited transmission line siting certificates; to provide for customer generation and net metering programs and the responsibilities of certain providers of electric service and customers with respect to customer generation and net metering; to provide for fees; to prescribe the powers and duties of certain state agencies and officials; to require the promulgation of rules and the issuance of orders; to authorize the establishment of residential energy improvement programs by providers of electric or natural gas service; and to provide for civil sanctions, remedies, and penalties.
Sec. 1. (1) This act shall be known and may be cited as the "clean and renewable energy and energy waste reduction act".
(2) The purpose of this act is to promote the development and use of clean and renewable energy resources and the reduction of energy waste through programs that will cost-effectively do all of the following:
(a) Diversify the resources used to reliably meet the energy needs of consumers in this state.
(b) Provide greater energy security through the use of indigenous energy resources available within the state.
(c) Encourage private investment in renewable energy and energy waste reduction.
(d) Coordinate with federal regulations to provide improved air quality and other benefits to energy consumers and citizens of this state.
(e) Remove unnecessary burdens on the appropriate use of solid waste as a clean energy source.
(3) As a goal, not less than 35% of this state's electric needs should be met through a combination of energy waste reduction and renewable energy by 2025, if the investments in energy waste reduction and renewable energy are the most reasonable means of meeting an electric utility's energy and capacity needs relative to other resource options. Both of the following count toward achievement of the goal:
(a) All renewable energy, including renewable energy credits purchased or otherwise acquired with or without the associated renewable energy, and any banked renewable energy credits, that counted toward the renewable energy standard on the effective date of the 2016 amendatory act that added this subsection, as well as renewable energy credits granted as a result of any investments made in renewable energy by the utility or a utility customer after that effective date.
(b) The sum of the annual electricity savings since October 6, 2008, as recognized by the commission through annual reconciliation proceedings, that resulted from energy waste reduction measures implemented under an energy optimization plan or energy waste reduction plan approved under section 73.
(e) Mitigate greenhouse gas emissions and climate change.
(a) "Applicable regional transmission organization" means a nonprofit, member-based organization governed by an independent board of directors that serves as the regional transmission organization approved by the Federal Energy Regulatory Commission with oversight responsibility for the region that includes the provider's service territory.
(b) "Biomass" means any organic matter that is not derived from fossil fuels, that can be converted to usable fuel for the production of energy, and that replenishes over a human, not a geological, time frame, including, but not limited to, all of the following:
(i) Agricultural crops and crop wastes.
(ii) Short-rotation energy crops.
(iii) Herbaceous plants.
(iv) Trees and wood, but only if derived from sustainably managed forests or procurement systems, as defined in section 261c of the management and budget act, 1984 PA 431, MCL 18.1261c.
(v) Paper and pulp products.
(vi) Precommercial wood thinning waste, brush, or yard waste.
(vii) Wood wastes and residues from the processing of wood products or paper.
(viii) Animal wastes.
(ix) Wastewater sludge or sewage.
(x) Aquatic plants.
(xi) Food production and processing waste.
(xii) Organic by-products from the production of biofuels.
(c) "Board" means the wind energy resource zone board created under section 143.
(d) "Carbon dioxide emissions benefits" means that the carbon dioxide emissions per megawatt hour of electricity generated by the advanced cleaner energy system are at least 85% less or, for an integrated gasification combined cycle facility or an integrated pyrolysis combined cycle facility, 70% less than the average carbon dioxide emissions per megawatt hour of electricity generated from all coal-fired electric generating facilities operating in this state on January 1, 2008.
(d) "Capacity" means the maximum output of electricity that a generator can produce under ideal conditions, generally measured in megawatts or kilowatts.
(e) "Carbon capture and storage" means a process that involves collecting carbon dioxide at its source and storing, or sequestering, it to prevent its release into the atmosphere.
(f) "Carbon-free energy" means electricity or steam generated using a carbon-free energy system.
(g) "Carbon-free energy plan" or, unless the context requires a different meaning, "plan" means a plan approved or found to comply with this act under section 51 with any amendments adopted under this act.
(h) "Carbon-free energy portfolio" means the percentage of an electric provider's total retail electric sales consisting of carbon-free energy.
(i) "Carbon-free energy standard" means the carbon-free energy portfolio required under section 28(2).
(j) "Carbon-free energy system" means a facility, electricity generation system, or set of electricity generation systems that generates electricity or steam without emitting greenhouse gas. Carbon-free energy system does not include a facility or system that utilizes any of the following:
(i) Carbon capture and storage.
(ii) Hydrogen as a fuel source to generate electricity.
(iii) Natural gas as a fuel source to generate electricity.
(k) (e) "Cogeneration facility" means a facility that produces both electricity and useful thermal energy, such as heat or steam, in a way that is more efficient than the separate production of those forms of energy.
(l) (f) "Commission" means the Michigan public service commission.
(m) (g) "Customer meter" means an electric meter of a provider's retail customer. Customer meter does not include a municipal water pumping meter or additional meters at a single site that were installed specifically to support interruptible air conditioning, interruptible water heating, net metering, or time-of-day tariffs.
(n) "Distributed generation" means the generation of electricity under the distributed generation program.
(o) (h) "Distributed generation program" means the program established by the commission under section 173.
(a) "Gasification facility" means a facility located in this state that, using a thermochemical process that does not involve direct combustion, produces synthesis gas, composed of carbon monoxide and hydrogen, from carbon-based feedstocks (such as coal, petroleum coke, wood, biomass, hazardous waste, medical waste, industrial waste, and solid waste, including, but not limited to, municipal solid waste, electronic waste, and waste described in section 11514 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.11514) and that uses the synthesis gas or a mixture of the synthesis gas and methane to generate electricity for commercial use. Gasification facility includes the transmission lines, gas transportation lines and facilities, and associated property and equipment specifically attributable to such a facility. Gasification facility includes, but is not limited to, an integrated gasification combined cycle facility and a plasma arc gasification facility.
(b) "Greenhouse gas" means carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, or sulfur hexafluoride.
(c) (b) "Incremental costs of compliance" means the net revenue required by an electric provider to comply with the renewable energy standard, calculated as provided under section 47.
(d) (c) "Independent transmission company" means that term as defined in section 2 of the electric transmission line certification act, 1995 PA 30, MCL 460.562.
(e) (d) "Integrated gasification combined cycle facility" means a gasification facility that uses a thermochemical process, including high temperatures and controlled amounts of air and oxygen, to break substances down into their molecular structures and that uses exhaust heat to generate electricity.
(f) (e) "Integrated pyrolysis combined cycle facility" means a pyrolysis facility that uses exhaust heat to generate electricity.
(g) (f) "LEED" means the leadership in energy and environmental design green building rating system developed by the United States Green Building Council.
(h) (g) "Load management" means measures or programs that target equipment or behavior to result in decreased peak electricity demand such as by shifting demand from a peak to an off-peak period.
(i) "Low-income customer" means a customer whose household income does not exceed 200% of the federal poverty level, as published by the United States Department of Health and Human Services, or who is enrolled in any federal, state, or local program with similar income eligibility requirements, including, but not limited to, any of the following:
(i) A state emergency relief program.
(ii) The food assistance program administered under the social welfare act, 1939 PA 280, MCL 400.1 to 400.119b.
(iii) Medicaid.
(j) "Medicaid" means the medical assistance program established and administered by this state under section 105 of the social welfare act, 1939 PA 280, MCL 400.105.
(k) (h) "Megawatt", "megawatt hour", or "megawatt hour of electricity", unless the context implies otherwise, includes the steam equivalent of a megawatt or megawatt hour of electricity.
(l) (i) "Modified net metering" means a utility billing method that applies the power supply component of the full retail rate to the net of the bidirectional flow of kilowatt hours across the customer interconnection with the utility distribution system, during a billing period or time-of-use pricing period. A negative net metered quantity during the billing period or during each time-of-use pricing period within the billing period reflects net excess generation for which the customer is entitled to receive credit under section 177(4). Under modified net metering, standby charges for distributed generation customers on an energy rate schedule shall be equal to the retail distribution charge applied to the imputed customer usage during the billing period. The imputed customer usage is calculated as the sum of the metered on-site generation and the net of the bidirectional flow of power across the customer interconnection during the billing period. The commission shall establish standby charges under modified net metering for distributed generation customers on demand-based rate schedules that provide an equivalent contribution to utility system costs. A charge for net metering and distributed generation customers established pursuant to section 6a of 1939 PA 3, MCL 460.6a, shall not be recovered more than once. This subdivision is subject to section 177(5).
(a) "Natural gas provider" means an investor-owned business engaged in the sale and distribution at retail of natural gas within this state whose rates are regulated by the commission.
(b) "Pet coke" means a solid carbonaceous residue produced from a coker after cracking and distillation from petroleum refining operations.
(c) "Plasma arc gasification facility" means a gasification facility that uses a plasma torch to break substances down into their molecular structures.
(c) (d) "Provider" means an electric provider or a natural gas provider.
(d) (e) "PURPA" means the public utility regulatory policies act of 1978, Public Law 95-617.
(e) (f) "Pyrolysis facility" means a facility that effects thermochemical decomposition at elevated temperatures without the participation of oxygen, from carbon-based feedstocks, including, but not limited to, coal, wood, biomass, industrial waste, or solid waste, but not including pet coke, hazardous waste, coal waste, or scrap tires. Pyrolysis facility includes the transmission lines, gas transportation lines and facilities, and associated property and equipment specifically attributable to the facility. Pyrolysis facility includes, but is not limited to, an integrated pyrolysis combined cycle facility.
(a) "Renewable energy" means electricity or steam generated using a renewable energy system.
(b) "Renewable energy contract" means a contract to acquire renewable energy and the associated renewable energy credits from 1 or more renewable energy systems.
(c) "Renewable energy credit" means a credit granted under a certification and tracking program established under section 41, which represents generated renewable energy.
(d) "Renewable energy credit portfolio" means the sum of the renewable energy credits achieved by a provider for a particular year.
(e) "Renewable energy credit standard" means a minimum renewable energy credit portfolio required under section 28 28(1) or former section 27.
(f) "Renewable energy plan" or, unless the context requires a different meaning, "plan" means a plan approved under section 22 or former section 21 or 23 or found to comply with this act under former section 25, with any amendments adopted under this act.
(g) "Renewable energy resource" means a resource that naturally replenishes over a human, not a geological, time frame and that is ultimately derived from solar power, water power, or wind power. Renewable energy resource does not include petroleum, nuclear fuel, natural gas, or coal, hydrogen, solid waste, biofuel, or, except to the extent authorized in a renewable energy plan in effect on the effective date of the amendatory act that added section 51, biomass. A renewable energy resource comes from the sun or from thermal inertia of the earth and minimizes the output of toxic material in the conversion of the energy and includes, but is not limited to, all of the following:
(i) Biomass.
(i) (ii) Solar and solar thermal energy.
(ii) (iii) Wind energy.
(iii) (iv) Kinetic energy of moving water, including all of the following:
(A) Waves, tides, or currents.
(B) Water released through a dam.
(iv) (v) Geothermal energy.
(v) (vi) Thermal energy produced from a geothermal heat pump.
(vi) (vii) Any of the following cleaner energy resources, but only to the extent authorized in a renewable energy plan in effect on the effective date of the amendatory act that added section 51:
(A) Municipal solid waste, including the biogenic and anthropogenic factions.
(B) Landfill gas produced by municipal solid waste.
(C) Fuel that has been manufactured in whole or significant part from waste, including, but not limited to, municipal solid waste. Fuel that meets the requirements of this subparagraph includes, but is not limited to, material that is listed under 40 CFR 241.3(b) or 241.4(a) or for which a nonwaste determination is made by the United States Environmental Protection Agency pursuant to 40 CFR 241.3(c). Pet coke, hazardous waste, coal waste, or scrap tires are not fuel that meets the requirements of this subparagraph.
(h) "Renewable energy standard" means the minimum renewable energy capacity portfolio, if applicable, and the renewable energy credit portfolio required to be achieved under section 28 or former section 27.
(i) "Renewable energy system" means a facility, electricity generation system, or set of electricity generation systems that use 1 or more renewable energy resources to generate electricity or steam. Renewable energy system does not include any of the following:
(i) A hydroelectric pumped storage facility.
(ii) A hydroelectric facility that uses a dam constructed after October 6, 2008 unless the dam is a repair or replacement of a dam in existence on October 6, 2008 or an upgrade of a dam in existence on October 6, 2008 that increases its energy efficiency.
(iii) An incinerator. unless the incinerator is a municipal solid waste incinerator as defined in section 11504 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.11504.
(iv) A gasification facility.
(v) A pyrolysis facility.
(vi) A facility using carbon capture and storage technology.
(j) "Revenue recovery mechanism" means the mechanism for recovery of incremental costs of compliance provided for under section 22.
ENERGY STANDARDS
RENEWABLE AND CARBON-FREE ENERGY
Sec. 22. (1) Renewable energy plans and associated revenue recovery mechanisms filed by an electric provider, approved under former section 21 or 23 or found to comply with this act under former section 25 and in effect on the effective date of the 2016 amendatory act that added this section, section 50, remain in effect, subject to amendments as provided for under subsections (3) and (4).
(2) For an electric provider whose rates are regulated by the commission, amended renewable energy plans shall establish a nonvolumetric mechanism for the recovery of the incremental costs of compliance within the electric provider's customer rates. The revenue recovery mechanism shall not result in rate impacts that exceed the monthly maximum retail rate impacts specified under section 45. The revenue recovery mechanism is subject to adjustment under sections 47(4) and section 49.
(3) Within 1 year after the effective date of the 2016 amendatory act that added this section, By April 20, 2024, and every 2 years thereafter through 2030, the commission shall review each electric provider's plan pursuant to a filing schedule established by the commission. For reviews of its plan, a provider shall propose plan amendments to conform the renewable energy credit standard.
(4) For In its review of the plan of an electric provider whose rates are regulated by the commission, the commission shall conduct a contested case hearing on the plan pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. After the hearing, the commission shall approve, with any changes consented to by the electric provider, modify, or reject the plan and any amendments to the plan. For all other electric providers, the commission shall provide an opportunity for public comment on the plan. After the applicable opportunity for public comment, the commission shall determine whether any amendment to the plan proposed by the provider complies with this act. For alternative electric suppliers, the commission shall approve, with any changes consented to by the electric provider, modify, or reject any proposed amendments to the plan. For cooperative electric utilities and municipally owned utilities, the proposed amendment is adopted if the commission determines that it complies with this act.
(5) (4) If an electric provider proposes to amend its plan after the at a time other than a scheduled review process under subsection (3), the electric provider shall file the proposed amendment with the commission. For an electric provider whose rates are regulated by the commission, if the proposed amendment would modify the revenue recovery mechanism, the commission, in its review of the proposed amendment, shall conduct a contested case hearing on the amendment pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. After the hearing and within 90 days after the amendment is filed, review, the commission shall approve, with any changes consented to by the electric provider, modify, or reject the plan and the proposed amendment or amendments to the plan. For all other electric providers, the commission shall provide an opportunity for public comment on the amendment. After the applicable opportunity for public comment, and within 90 days after the amendment is filed, the commission shall determine whether the proposed amendment to the plan complies with this act. For alternative electric suppliers, the commission shall approve, with any changes consented to by the electric provider, modify, or reject any proposed amendments to the plan. For cooperative electric utilities and municipally owned utilities, the proposed amendment is adopted if the commission determines that it complies with this act.
(6) (5) For an electric provider whose rates are regulated by the commission, the commission shall approve the plan or amendments to the plan if the commission determines both of the following:
(a) That the plan is reasonable and prudent. In making this determination, the commission shall take into consideration projected costs and whether or not projected costs in prior plans were exceeded.
(b) That the plan is consistent with the purpose and goal set forth in section 1(2) and (3) and meets the renewable energy credit standard through 2021.2035.
(7) For an electric provider whose rates are regulated by the commission, the commission shall review the projected costs of the plan and approve, in whole or in part, the projected costs if the commission finds those projected costs, in whole or in part, to be reasonable and prudent. In making this determination, the commission shall consider whether projected costs in prior plans were exceeded.
(8) (6) If the commission rejects a proposed plan, or an amendment, or projected costs under this section, the commission shall explain in writing the reasons for its determination.
(9) Beginning in 2030, each electric provider shall file its renewable energy plan, and the commission shall review the plan, as part of the electric provider's carbon-free energy plan.
Sec. 28. (1) An electric provider shall achieve a renewable energy credit portfolio as follows:of at least the following:
(a) In 2016 through 2018, a renewable energy credit portfolio that consists of at least the same number of renewable energy credits as were required under former section 27.
(b) In 2019 and 2020, a renewable energy credit portfolio of at least 12.5%, as calculated under subsection (2).12.5%.
(c) In 2021 ,a renewable energy credit portfolio of at least 15%, as calculated under subsection (2).through 2026, 15%.
(d) In 2027 through 2029, 40%.
(e) In 2030 and each year thereafter, 60%.
(2) In addition to the renewable energy credit portfolio requirements of this section, in 2035 and each year thereafter, an electric provider shall achieve a carbon-free energy portfolio of 100%, subject to the exceptions for biomass and cleaner energy resources in the definition of renewable energy resource.
(3) (2) An electric provider's renewable energy credit portfolio shall be calculated as follows:
(a) Determine the number of renewable energy credits used to comply with this subpart during the applicable year.
(b) Divide by 1 of the following at the option of the electric provider as specified in its renewable energy plan:
(i) The number of weather normalized megawatt hours of electricity sold by the electric provider during the previous year to retail customers in this state.
(ii) The average number of megawatt hours of electricity sold by the electric provider annually during the previous 3 years to retail customers in this state.
(c) Multiply the quotient under subdivision (b) by 100.
(4) (3) Subject to subsection (5), each Each electric provider shall meet the renewable energy credit standards with as follows:
(a) At least 9% of the renewable energy credit portfolio required under subsection (1)(e) shall be obtained from distributed generation projects, and at least 2/3 of that 9% shall be obtained from distributed generation projects located in low-income communities or that serve low-income customers.
(b) At least 6% of the renewable energy credit portfolio required under subsection (1)(e) shall consist of renewable energy credits from distributed generation projects that enable renters and customers without suitable roof space to obtain renewable energy subscriptions, where at least 50% of the capacity of those projects is reserved for low-income customers.
(c) The balance of renewable energy credits shall be obtained by 1 or more either or both of the following means:
(i) (a) Generating electricity from renewable energy systems for sale to retail customers.
(ii) (b) Purchasing or otherwise acquiring renewable energy credits or capacity. with or without the associated renewable energy.
(5) (4) For an electric provider whose rates are regulated by the commission, the electric provider shall submit a contract entered into for the purposes of subsection (3) (4) to the commission for review and approval. If the commission approves the contract, it shall be is considered consistent with the electric provider's renewable energy plan. The commission shall not approve a contract based on an unsolicited proposal unless the commission determines that the unsolicited proposal provides opportunities that may not otherwise be available or commercially practical through a competitive bid process.
(5) An electric provider may substitute energy waste reduction credits for renewable energy credits otherwise required to meet the renewable energy credit standards if the substitution is approved by the commission. Under this subsection, energy waste reduction credits shall not be used by a provider to meet more than 10% of the renewable energy credit standard. One renewable energy credit shall be awarded per 1 energy waste reduction credit.
Sec. 29. (1) Subject to subsection (2), a A renewable energy system that is the source of renewable energy credits used to satisfy the renewable energy standards shall be either located outside of this state in the retail electric customer service territory of any provider that is not an alternative electric supplier if the renewable energy system will provide energy and capacity to electric customers in this state or located anywhere in this state. For the purposes of this subsection, a retail electric customer service territory shall be considered to be the territory recognized by the commission on January 1, 2008 and any expansion of retail electric customer service territory recognized by the commission after January 1, 2008 under 1939 PA 3, MCL 460.1 to 460.11. The commission may also expand a service territory for the purposes of this subsection if a lack of transmission lines limits the ability to obtain sufficient renewable energy from renewable energy systems that meet the location requirement of this subsection.
(2) The renewable energy system location requirements in subsection (1) do not apply if 1 or more of the following requirements are met:
(a) The renewable energy system is a wind energy conversion system and the electricity generated by the wind energy system, or the renewable energy credits associated with that electricity, is being purchased under a contract in effect on January 1, 2008. If the electricity and associated renewable energy credits purchased under such a contract are used by an electric provider to meet renewable energy requirements established after January 1, 2008 by the legislature of the state in which the wind energy conversion system is located, the electric provider may, for the purpose of meeting the renewable energy credit standard under this act, obtain, by any means authorized under section 28, up to the same number of replacement renewable energy credits from any other wind energy conversion systems located in that state. This subdivision shall not be utilized by an alternative electric supplier unless the alternative electric supplier was licensed in this state on January 1, 2008. Renewable energy credits from a renewable energy system under a contract with an alternative electric supplier under this subdivision shall not be used by another electric provider to meet its requirements under this part.
(b) The renewable energy system is a wind energy conversion system that was under construction or operational and owned by an electric provider on January 1, 2008. This subdivision shall not be utilized by an alternative electric supplier.
(c) The renewable energy system is a wind energy conversion system that includes multiple wind turbines, at least 1 of the wind turbines meets the location requirements of this section, and the remaining wind turbines are within 15 miles of a wind turbine that is part of that wind energy conversion system and that meets the location requirements of this section.
(d) Before January 1, 2008, an electric provider serving not more than 75,000 retail electric customers in this state filed an application for a certificate of authority for the renewable energy system with a state regulatory commission in another state that is also served by the electric provider. However, renewable energy credits shall not be granted under this subdivision for electricity generated using more than 10.0 megawatts of nameplate capacity of the renewable energy system.
(e) Electricity generated from the renewable energy system is sold by a not-for-profit entity located in Indiana, Ohio, or Wisconsin to a municipally-owned electric utility in this state or cooperative electric utility in this state, and the electricity is not being used to meet another state's standard for renewable energy.
(f) All of the following requirements are met:
(i) The renewable energy system is a wind energy system, is interconnected to the electric provider's transmission system, and is located in a state in which the electric provider has service territory.
(ii) The electric provider competitively bid any contract for engineering, procurement, or construction of the renewable energy system, if the electric provider owns the renewable energy system, or for purchase of the renewable energy and associated renewable energy credits from the renewable energy system, if the provider does not own the renewable energy system, in a process open to renewable energy systems sited in this state.
(iii) The renewable energy credits from the renewable energy system are only used by that electric provider to meet the renewable energy standard.
(iv) The electric provider is not an alternative electric supplier.
Sec. 32. (1) The commission may grant an extension to meet the renewable energy credit standard on petition and a showing by an electric provider of either or both of the following:
(a) That compliance with the standard is not practically feasible despite all commercially reasonable efforts by the electric provider to comply. Issuing a request for proposals to purchase renewable energy and not receiving a commercially viable offer creates a rebuttable presumption that compliance with the standard is not practically feasible.
(b) That compliance would be excessively costly to customers, despite commercially reasonable efforts by the electric provider to contain costs.
(2) The commission shall not grant an electric provider more than 2 extensions or more than 1 extension per year. Each extension shall not exceed 1 year.
Sec. 34. (1) Subject to subsections (2) and (3), an electric provider that had 1,000,000 or more retail customers in this state on January 1, 2008 shall obtain the renewable energy credits that are necessary to meet the renewable energy credit standard as follows:
(a) At the electric provider's option, up to but no more than 50% of the renewable energy credits shall be from any of the following:
(i) Renewable energy systems that were developed by and are owned by the electric provider. An electric provider shall competitively bid any contract for engineering, procurement, or construction of any new renewable energy systems described in this subdivision. However, an electric provider may consider unsolicited proposals presented to it by a renewable energy system developer outside of a competitive bid process. If the provider determines that such an unsolicited proposal provides opportunities that may not otherwise be available or commercially practical, the provider may enter into a contract with the developer.
(ii) Renewable energy systems that were developed by 1 or more third parties pursuant to a contract with the electric provider under which the ownership of the renewable energy system may be transferred to the electric provider, but only after the renewable energy system begins commercial operation. Any such contract shall be executed after a competitive bid process conducted pursuant to guidelines issued by the commission. However, an electric provider may consider unsolicited proposals presented to it by a renewable energy system developer outside of a competitive bid process. If the provider determines that such an unsolicited proposal provides opportunities that may not otherwise be available or commercially practical, the provider may enter into a contract with the developer. An affiliate of the electric provider may submit a proposal in response to a request for proposals, subject to the code of conduct under section 10a(4) of 1939 PA 3, MCL 460.10a, and the sanctions for violation of the code under section 10c of 1939 PA 3, MCL 460.10c.
(b) At least 50% of the renewable energy credits shall be from renewable energy contracts that do not require transfer of ownership of the applicable renewable energy system to the electric provider or from contracts for the purchase of renewable energy credits without the associated renewable energy. A renewable energy contract or contract for the purchase of renewable energy credits under this subdivision shall be executed after a competitive bid process conducted pursuant to guidelines issued by the commission. However, an electric provider may consider unsolicited proposals presented to it outside of a competitive bid process by a renewable energy system developer that is not affiliated with the electric provider. If the provider determines that such an unsolicited proposal provides opportunities that may not otherwise be available or commercially practical, the provider may enter into a contract with the developer. The contract is subject to review and approval by the commission under section 28(5). An electric provider or its affiliate may not submit a proposal in response to its own request for proposals under this subdivision. If an electric provider selects a bid other than the lowest price conforming bid from a qualified bidder, the electric provider shall promptly notify the commission. The commission shall determine whether the electric provider had good cause for selecting that bid. If the commission determines that the electric provider did not have good cause, the commission shall disapprove the contract.
(2) Subsection (1) does not apply to either of the following:
(a) Renewable energy credits that are transferred to the electric provider pursuant to section 35(1).
(b) Renewable energy credits that are produced or obtained by the electric provider from renewable energy systems for which recovery in electric rates was approved as of the effective date of the amendatory act that added this section, including renewable energy credits resulting from biomass co-firing of electric generation facilities in existence on that date, except to the extent the number of megawatt hours of electricity annually generated by biomass co-firing exceeds the number of megawatt hours generated during the 1-year period immediately preceding that date.
(3) An electric provider shall submit a contract entered into pursuant to subsection (1) to the commission for review and approval. If the commission approves the contract, it shall be considered to be consistent with the electric provider's renewable energy plan. The commission shall not approve a contract based on an unsolicited proposal unless the commission determines that the unsolicited proposal provides opportunities that may not otherwise be available or commercially practical.
Sec. 45. (1) An electric provider shall recover the incremental cost of compliance with the renewable energy standards for renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50.
(2) (1) For an electric provider whose rates are regulated by the commission, the commission shall determine the appropriate charges for the electric provider's tariffs that permit recovery of the incremental cost of compliance subject to the retail rate impact limits set forth in subsection (2).for renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50. For an electric provider whose rates are regulated by the commission, costs of complying with the renewable energy credit standard shall be recovered as provided in section 50 and costs of complying with the carbon-free energy standard shall be recovered as provided in section 52.
(2) An electric provider shall recover the incremental cost of compliance with the renewable energy standards. An electric provider shall not comply with the renewable energy standards to the extent that, as determined by the commission, recovery of the incremental cost of compliance will have a retail rate impact that exceeds any of the following:
(a) $3.00 per month per residential customer meter.
(b) $16.58 per month per commercial secondary customer meter.
(c) $187.50 per month per commercial primary or industrial customer meter.
(3) The retail rate impact limits of subsection (2) apply only to the incremental costs of compliance and do not apply to costs approved for recovery by the commission other than as provided in this act.
(3) (4) The incremental cost of compliance shall be calculated for a 20-year period beginning with approval of the renewable energy plan and shall be recovered on a levelized basis.
Sec. 47. (1) Subject to the retail rate impact limits under section 45, the The commission shall consider all actual costs reasonably and prudently incurred in good faith to implement a commission-approved renewable energy plan by an electric provider whose rates are regulated by the commission to be a cost of service to be recovered by the electric provider. Subject to the retail rate impact limits under section 45, an An electric provider whose rates are regulated by the commission shall recover through its retail electric rates all of the electric provider's incremental costs of compliance for renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50 during the 20-year period beginning when the electric provider's original renewable energy plan is was approved by the commission and all reasonable and prudent ongoing costs of compliance during and after that period. The recovery shall include, but is not limited to, the electric provider's authorized rate of return on equity for costs approved under this section, which shall remain fixed at the rate of return and debt to equity ratio that was in effect in the electric provider's base rates when the electric provider's renewable energy plan was approved.
(2) Incremental costs of compliance for renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50 shall be calculated as follows:
(a) Determine the sum of the following costs to the extent those costs are reasonable and prudent and not already approved for recovery in electric rates as of October 6, 2008:
(i) Capital, operating, and maintenance costs of renewable energy systems, or advanced cleaner energy systems, including property taxes, insurance, and return on equity associated with an electric provider's renewable energy systems, or advanced cleaner energy systems, including the electric provider's renewable energy portfolio established to achieve compliance with the renewable energy standards and any additional renewable energy systems or advanced cleaner energy systems that are built or acquired by the electric provider to maintain compliance with the renewable energy standards during the 20-year period beginning when the electric provider's plan is approved by the commission.
(ii) Financing costs attributable to capital, operating, and maintenance costs of capital facilities associated with renewable energy systems or advanced cleaner energy systems used to meet the renewable energy standard.
(iii) Costs that are not otherwise recoverable in rates approved by the Federal Energy Regulatory Commission and that are related to the infrastructure required to bring renewable energy systems or advanced cleaner energy systems used to achieve compliance with the renewable energy standards on to the transmission system, including interconnection and substation costs for renewable energy systems or advanced cleaner energy systems used to meet the renewable energy standard.
(iv) Ancillary service costs determined by the commission to be necessarily incurred to ensure the quality and reliability of renewable energy or advanced cleaner energy used to meet the renewable energy standards, regardless of the ownership of a renewable energy system. or advanced cleaner energy technology.
(v) Except to the extent the costs are allocated under a different subparagraph, all of the following:
(A) The costs of renewable energy credits purchased under this act.
(B) The costs of contracts described in former section 33(1).
(vi) Expenses incurred as a result of state or federal governmental actions related to renewable energy systems or advanced cleaner energy systems attributable to the renewable energy standards, including changes in tax or other law.
(vii) Any additional electric provider costs determined by the commission to be necessarily incurred to ensure the quality and reliability of renewable energy or advanced cleaner energy used to meet the renewable energy standards.
(b) Subtract from the sum of costs not already included in electric rates determined under subdivision (a) the sum of the following revenues:
(i) Revenue derived from the sale of environmental attributes associated with the generation of renewable energy or advanced cleaner energy systems attributable to the renewable energy standards. Such revenue shall not be considered in determining power supply cost recovery factors under section 6j of 1939 PA 3, MCL 460.6j.
(ii) Interest on regulatory liabilities.
(iii) Tax credits specifically designed to promote renewable energy. or advanced cleaner energy.
(iv) Revenue derived from the provision of renewable energy or advanced cleaner energy to retail electric customers subject to a power supply cost recovery clause under section 6j of 1939 PA 3, MCL 460.6j, of an electric provider whose rates are regulated by the commission. After providing an opportunity for a contested case hearing for an electric provider whose rates are regulated by the commission, the commission shall annually establish a price per megawatt hour. An electric provider whose rates are regulated by the commission may at any time petition the commission to revise the price. In setting the price per megawatt hour under this subparagraph, the commission shall consider factors, including, but not limited to, projected capacity, energy, maintenance, and operating costs; information filed under section 6j of 1939 PA 3, MCL 460.6j; and information from wholesale markets, including, but not limited to, locational marginal pricing. This price shall be multiplied by the sum of the number of megawatt hours of renewable energy and the number of megawatt hours of advanced cleaner energy used to maintain compliance with the renewable energy standard. The product shall be considered a booked cost of purchased and net interchanged power transactions under section 6j of 1939 PA 3, MCL 460.6j. For energy purchased by such an electric provider under a renewable energy contract, or advanced cleaner energy contract, the price shall be the lower of the amount established by the commission or the actual price paid and shall be multiplied by the number of megawatt hours of renewable energy or advanced cleaner energy purchased. The resulting value shall be considered a booked cost of purchased and net interchanged power under section 6j of 1939 PA 3, MCL 460.6j.
(v) Revenue from wholesale renewable energy sales. and advanced cleaner energy sales. Such revenue shall not be considered in determining power supply cost recovery factors under section 6j of 1939 PA 3, MCL 460.6j.
(vi) Any additional electric provider revenue considered by the commission to be attributable to the renewable energy standards.
(vii) Any revenues recovered in rates for renewable energy costs that are included under subdivision (a).
(3) The For renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50, the commission shall authorize an electric provider whose rates are regulated by the commission to spend in any given month more to comply with this act and implement an approved a renewable energy plan than the revenue actually generated by the revenue recovery mechanism. An electric provider whose rates are regulated by the commission shall recover its commission approved pre-tax rate of return on regulatory assets during the appropriate period. An electric provider whose rates are regulated by the commission shall record interest on regulatory liabilities at the average short-term borrowing rate available to the electric provider during the appropriate period. Any regulatory assets or liabilities resulting from the recovery of costs of renewable energy or advanced cleaner energy attributable to renewable energy standards through the power supply cost recovery clause under section 6j of 1939 PA 3, MCL 460.6j, shall continue to be reconciled under that section.
(4) If an electric provider's incremental costs of compliance in any given month during the 20-year period beginning when the electric provider's plan is approved by the commission are in excess of the revenue recovery mechanism as adjusted under section 49 and in excess of the balance of any accumulated reserve funds, subject to the minimum balance established under section 49, the electric provider shall immediately notify the commission. The commission shall promptly commence a contested case hearing pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328, and modify the revenue recovery mechanism so that the minimum balance is restored. However, if the commission determines that recovery of the incremental costs of compliance would otherwise exceed the maximum retail rate impacts specified under section 45, it shall set the revenue recovery mechanism for that electric provider to correspond to the maximum retail rate impacts. Excess costs shall be accrued and deferred for recovery. Not later than the expiration of the 20-year period beginning when the electric provider's plan is approved by the commission, for an electric provider whose rates are regulated by the commission, the commission shall determine the amount of deferred costs to be recovered under the revenue recovery mechanism and the recovery period, which shall not extend more than 5 years beyond the expiration of the 20-year period beginning when the electric provider's plan is approved by the commission. The recovery of excess costs shall be proportional to the retail rate impact limits in section 45 for each customer class. The recovery of excess costs alone, or, if begun before the expiration of the 20-year period, in combination with the recovery of incremental costs of compliance under the revenue recovery mechanism, shall not exceed the retail rate impact limits of section 45 for each customer class.
(4) (5) If, at the expiration of the 20-year period beginning when the electric provider's original renewable energy plan is was approved by the commission, an electric provider whose rates are regulated by the commission has a regulatory liability, the electric provider may utilize the regulatory liability to purchase renewable energy, renewable capacity, or renewable energy credits or may refund the regulatory liability. A refund to customer classes shall be proportional to the amounts paid by those customer classes under the revenue recovery mechanism.
(5) (6) After achieving compliance with the renewable energy standard for 2015, the actual costs reasonably and prudently incurred to continue to comply with this subpart both during and after the conclusion of the 20-year period beginning when the electric provider's plan is approved by the commission shall be considered costs of service and recovered under section 50. The commission shall determine a mechanism for an electric provider whose rates are regulated by the commission to recover these costs in its retail electric rates, subject to the retail rate impact limits in section 45. Remaining and future regulatory assets shall be recovered consistent with subsections (3) and (4) and section 49.
(7) As used in this section:
(a) "Advanced cleaner energy" means electricity generated using an advanced cleaner energy system.
(b) "Advanced cleaner energy system" means any of the following:
(i) A gasification facility.
(ii) A cogeneration facility.
(iii) A coal-fired electric generating facility if 85% or more of the carbon dioxide emissions are captured and permanently geologically sequestered or used for other commercial or industrial purposes that do not result in release of carbon dioxide to the atmosphere.
(iv) A hydroelectric pumped storage facility.
(v) An electric generating facility or system that uses technologies not in commercial operation on October 6, 2008 and that the commission determines has carbon dioxide emissions benefits or will significantly reduce other regulated air emissions.
Sec. 49. (1) This section applies only to an electric provider whose rates are regulated by the commission and to renewable energy plans and amended renewable energy plans that are in effect on the effective date of the amendatory act that added section 50. The commission shall commence an annual proceeding, to be known as a renewable cost reconciliation, for each electric provider whose rates are regulated by the commission. The renewable cost reconciliation proceeding shall be conducted as a contested case pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. Reasonable discovery shall be permitted before and during the reconciliation proceeding to assist in obtaining evidence concerning reconciliation issues, including, but not limited to, the reasonableness and prudence of expenditures and the amounts collected pursuant to the revenue recovery mechanism.
(2) At the renewable cost reconciliation, an electric provider may propose any necessary modifications of the revenue recovery mechanism to ensure the electric provider's recovery of its incremental cost of compliance with the renewable energy standards.
(3) The commission shall reconcile the pertinent revenues recorded and the allowance for the nonvolumetric revenue recovery mechanism with the amounts actually expensed and projected according to the electric provider's renewable energy plan. The commission shall consider any issue regarding the reasonableness and prudence of expenses for which customers were charged in the relevant reconciliation period. In its order, the commission shall do all of the following:
(a) Make a determination of an electric provider's compliance with the renewable energy standards.
(b) Adjust the revenue recovery mechanism for the incremental costs of compliance. The commission shall ensure that the retail rate impacts under this renewable cost reconciliation revenue recovery mechanism do not exceed the maximum retail rate impacts specified under section 45. The commission shall ensure that the recovery mechanism is projected to maintain a minimum balance of accumulated reserve so that a regulatory asset does not accrue.
(c) Establish the price per megawatt hour for renewable energy and advanced cleaner energy capacity and for renewable energy and advanced cleaner energy to be recovered through the power supply cost recovery clause under section 6j of 1939 PA 3, MCL 460.6j, as outlined in section 47(2)(b)(iv).
(d) Adjust, if needed, the minimum balance of accumulated reserve funds described in subdivision (b).
(4) If an electric provider has recorded a regulatory liability in any given month during the 20-year period beginning when the electric provider's renewable energy plan was approved by the commission, interest on the regulatory liability balance shall be accrued at the average short-term borrowing rate available to the electric provider during the appropriate period, and shall be used to fund incremental costs of compliance incurred in subsequent periods within the 20-year period beginning when the electric provider's plan was approved by the commission.
(5) As used in this section, "advanced cleaner energy" means that term as defined in section 47.
Sec. 50. (1) This section applies only to electric providers whose rates are regulated by the commission. The actual costs reasonably and prudently incurred by an electric provider to comply with the renewable energy credit standards are costs of service, subject to this section.
(2) The commission shall authorize an electric provider to include in the electric provider's rate base the actual costs of renewable energy systems constructed or acquired by the electric provider up to the projected costs that the commission has approved in a renewable energy plan or renewable energy plan amendment under section 22.
(3) The commission shall authorize an electric provider to recover the actual costs of renewable energy, renewable capacity, and renewable energy credits purchased by the electric provider through the power supply cost recovery clause under section 6j of 1939 PA 3, MCL 460.6j, up to the projected costs of those purchases that the commission approved in a renewable energy plan or renewable energy plan amendment under section 22.
(4) If the actual costs incurred by an electric provider for any renewable energy system constructed or acquired by the electric provider exceed the costs approved by the commission, the electric provider has the burden of proving by a preponderance of the evidence that the excess costs are reasonable and prudent. The commission may authorize recovery of all or part of the excess costs if the commission finds by a preponderance of the evidence that the excess costs are reasonable and prudent. The commission shall disallow costs that the commission finds have been incurred as the result of fraud, concealment, mismanagement, or lack of quality controls amounting to mismanagement. The commission shall also require refunds to ratepayers, with interest at the electric provider's approved weighted average cost of capital, for any of these costs already recovered through the electric provider's rates and charges.
(5) If the actual costs incurred by an electric provider for any purchase of renewable energy, renewable capacity, or renewable energy credits exceed the costs approved by the commission, the commission shall review those costs in power supply cost reconciliation proceedings as excess costs under section 6j(15) of 1939 PA 3, MCL 460.6j, under the same standard provided for excess costs incurred through management actions contrary to the commission's power supply and cost review order.
(6) If the assumptions underlying a renewable energy plan or plan amendment materially change, or if the commission determines that a renewable energy system included in the plan is likely not to be commercially viable, an electric provider may request, or the commission on its own motion may initiate, a proceeding to review whether it is reasonable and prudent to complete the renewable energy system. If the commission finds that it is not reasonable and prudent to complete the renewable energy system as approved, the commission may modify or cancel approval of the renewable energy system and any unincurred costs in the electric provider's renewable energy plan or plan amendment that are no longer approved. If the commission modifies or cancels approval, the commission shall review renewable energy system costs already incurred or committed to by the electric provider. The commission shall authorize recovery of those costs only if the commission finds both of the following:
(a) Those costs were not incurred as the result of fraud, concealment, mismanagement, or lack of quality controls amounting to mismanagement.
(b) The electric provider's decisions related to incurring the costs were reasonable and prudent under the circumstances that were known or could have been known at the time the decisions were made.
(7) The commission may allow recovery, in an electric provider's base rates, of interest costs to finance in-progress construction of a renewable energy system approved under this section, before the renewable energy system is considered used and useful. Regardless of whether the commission authorizes the base rate treatment, an electric provider may recognize, accrue, and defer the allowance for funds used during construction.
Sec. 51. (1) To ensure the achievement of the carbon-free energy standard, each electric provider shall file, and the commission shall review, a carbon-free energy plan under the procedures and standards set forth in this section.
(2) Not later than April 20, 2030 and every 2 years thereafter, the commission shall review each electric provider's carbon-free energy plan pursuant to a filing schedule established by the commission.
(3) For an electric provider whose rates are regulated by the commission, the commission shall do all of the following:
(a) Conduct a contested case hearing on the carbon-free energy plan pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. After the hearing, the commission shall approve, modify, or reject the carbon-free energy plan and any amendments to the carbon-free energy plan.
(b) Approve the plan or amendments to the plan, as applicable, if the commission determines both of the following:
(i) That the plan is reasonable and prudent.
(ii) That the plan or amendment meets the renewable energy credit standard and carbon-free energy standard and is consistent with the purposes of the carbon-free energy standard.
(c) Review and approve, in whole or in part, the projected costs of the plan if the commission finds those projected costs or a portion of those projected costs to be reasonable and prudent.
(d) If the commission rejects a proposed plan, plan amendment, or any projected costs under this section, explain in writing the reasons for its determination.
(4) For all other electric providers, the commission shall provide an opportunity for public comment on the carbon-free energy plan. After the opportunity for public comment, the commission shall determine whether any amendment to the carbon-free energy plan proposed by the provider complies with this act. For alternative electric suppliers, the commission shall approve, with any changes consented to by the electric provider, or reject any proposed amendments to the carbon-free energy plan. For cooperative electric utilities and municipally owned utilities, the proposed amendment is adopted if the commission determines that it complies with this act.
(5) If an electric provider proposes to amend its carbon-free energy plan at a time other than a scheduled review process under subsection (2), the electric provider shall file the proposed amendment with the commission. The commission shall review the amended plan under the same procedures and standards set forth in subsection (2).
Sec. 52. (1) This section applies only to electric providers whose rates are regulated by the commission. The actual costs reasonably and prudently incurred by an electric provider to comply with the carbon-free energy standard shall be considered costs of service, subject to this section.
(2) The commission shall authorize an electric provider to include in the electric provider's rate base the actual costs of carbon-free energy systems constructed or acquired by the electric provider up to the projected costs that the commission has approved in a carbon-free plan or carbon-free plan amendment under section 51.
(3) The commission shall authorize an electric provider to recover in the actual costs of carbon-free energy and capacity purchased by the electric provider through the power supply cost recovery clause under section 6j of 1939 PA 3, MCL 460.6j, up to the projected costs of those purchases that the commission has approved in a carbon-free plan or plan amendment proceeding under section 51.
(4) If the actual costs incurred by an electric provider for any carbon-free energy system constructed or acquired by the electric provider exceed the costs approved by the commission, the electric provider has the burden of proving by a preponderance of the evidence that the excess costs are reasonable and prudent. The commission may authorize recovery of all or part of the excess costs if the commission finds by a preponderance of the evidence that the excess costs are reasonable and prudent. The commission shall disallow costs the commission finds have been incurred as the result of fraud, concealment, mismanagement, or lack of quality controls amounting to mismanagement. The commission shall also require refunds to ratepayers, with interest at the electric provider's approved weighted average cost of capital, for any of these costs already recovered through the electric provider's rates and charges.
(5) If the actual costs incurred by an electric provider for a purchase of carbon-free energy or carbon-free capacity exceed the costs approved by the commission, the commission shall review those costs in power supply cost reconciliation proceedings as excess costs under section 6j(15) of 1939 PA 3, MCL 460.6j, under the same standard provided for excess costs incurred through management actions contrary to the commission's power supply and cost review order.
(6) If the assumptions underlying a carbon-free energy plan or plan amendment materially change, or if the commission determines that a carbon-free energy system included in the plan is likely not to be commercially viable, an electric provider may request, or the commission on its own motion may initiate, a proceeding to review whether it is reasonable and prudent to complete the carbon-free energy system. If the commission finds that it is not reasonable and prudent to complete the carbon-free energy system as approved, the commission may modify or cancel approval of the carbon-free energy system and any unincurred costs in the electric provider's renewable energy plan or plan amendment that are no longer approved. If the commission modifies or cancels approval, the commission shall review carbon-free energy system costs already incurred or committed to by the electric provider. The commission shall authorize recovery of those costs only if the commission finds both of the following:
(a) Those costs were not incurred as the result of fraud, concealment, mismanagement, or lack of quality controls amounting to mismanagement.
(b) The electric provider's decisions related to incurring the costs were reasonable and prudent under the circumstances that were known or could have been known at the time the decisions were made.
(7) The commission may allow recovery in an electric provider's base rates of interest costs to finance in-progress construction of a carbon-free energy system approved under this section, before the carbon-free energy system is considered used and useful. Regardless of whether the commission authorizes the base rate treatment, an electric provider may recognize, accrue, and defer the allowance for funds used during construction.
Sec. 53. (1) On a formal complaint by any person presenting credible evidence of noncompliance or on its own motion, the commission shall regularly investigate whether an electric provider whose rates are regulated by the commission or an alternative electric supplier is in compliance with the renewable energy standard and the carbon-free energy standard. If the commission finds after notice and an opportunity for hearing that the electric provider is not in compliance with the renewable energy standard or carbon-free energy standard, the commission may order the electric provider, by a date or dates specified by the commission, to construct, issue requests for proposal for, or purchase energy generated by renewable energy systems or carbon-free energy systems, to purchase renewable energy credits, or to engage in other activities as the commission determines to be reasonably necessary to achieve compliance. If an electric provider fails to comply with an order under this subsection, the commission may impose a fine on the electric provider in an amount the commission determines sufficient to deter continued noncompliance, not to exceed the estimated cost of the electric provider to achieve compliance by the least costly alternative. An electric provider whose rates are regulated by the commission shall not recover the cost of any fine imposed under this subsection from retail customers in rates. The commission shall deposit any fines collected under this subsection in the low-income energy assistance fund created in section 9t of 1939 PA 3, MCL 460.9t. This subsection is in addition to and does not limit any other authority of the commission to enforce the renewable energy standard or carbon-free energy standard.
(2) The attorney general or any customer of a municipally owned electric utility or a cooperative electric utility that is member-regulated under the electric cooperative member-regulation act, 2008 PA 167, MCL 460.31 to 460.39, may commence a civil action for injunctive relief against that municipally owned electric utility or cooperative electric utility if the municipally owned electric utility or cooperative electric utility fails to meet the applicable requirements of this subpart or an order issued or rule promulgated under this subpart. The attorney general or customer shall commence an action under this subsection in the circuit court for the circuit in which the principal office of the municipally owned electric utility or cooperative electric utility is located. The attorney general or customer shall not file an action under this subsection unless the attorney general or customer has given the municipally owned electric utility or cooperative electric utility at least 60 days' written notice of the intent to sue, the basis for the suit, and the relief sought. Within 30 days after the municipally owned electric utility or cooperative electric utility receives written notice of the intent to sue, the municipally owned electric utility or cooperative electric utility and the attorney general or customer shall meet and make a good-faith attempt to determine if there is a credible basis for the action. The municipally owned electric utility or cooperative electric utility shall take all reasonable and prudent steps necessary to comply with the applicable requirements of this subpart or an order issued or rule promulgated under this subpart within 90 days after the meeting if there is a credible basis for the action. If the parties do not agree as to whether there is a credible basis for the action, the attorney general or customer may proceed to file the suit.
(3) A customer that prevails in an action brought under subsection (2) by judgment, by settlement, or by causing the municipally owned electric utility or cooperative electric utility to voluntarily comply is entitled to recover the customer's reasonable costs, attorney fees, and expert witness fees incurred in bringing the action.
Enacting section 1. This amendatory act takes effect 90 days after the date it is enacted into law.
