Energy Laws are Next on the Agenda of State Lawmakers

Understanding this tough issue

Lawmakers in Lansing are working on legislation that would bring major changes to Michigan’s energy laws. Since energy policy is a hard-to-understand topic, it does not receive much public scrutiny. By its very nature, it involves a mind-numbing array of technical terms, acronyms and insider elitist jargon that average people find both boring and confusing. This in turn gives policy insiders and advocates more of an incentive than usual to disseminate misinformation.

At the beginning of the year, there was an attempt to eliminate the competition — such as it is — that Consumers Energy and Detroit Edison face in the electricity market. This competition, in which only 10 percent of the market is open to outside companies, is referred to as "choice" in discussions of energy policy. The straightforward effort to eliminate this mere glimpse of a competitive market was quickly defeated by public opinion.

Consumers Energy and Detroit Edison, the state’s two quasi-monopolistic utilities, exercise tremendous influence over the Legislature and they were ready with an alternative plan. It ostensibly keeps partial choice in place but burdens it with more restrictions. Others, however, argue that this plan is a wolf in sleep’s clothing that would simply eliminate choice over a period of time instead of all at once.

The new cleverly nuanced plan will be more difficult to combat politically than the one that would have eliminated choice immediately. With backers of the new plan denying it would get rid of choice, the dispute is no longer about the merits of choice. Instead, it is about what the legislation would actually do. As a result, compelling arguments pointing out the benefits of competition are now landing wide of the target.

Another change in energy policy could come from a legislative proposal to set a goal for 30 percent of Michigan’s energy sources to be provided by a combination of alternative energy and reducing energy waste by 2030. The term "alternative energy" effectively means wind power.

There is a huge difference between a goal and a mandate. A mandate is a requirement; a goal is ... just a goal. This is something environmental groups were quick to notice and quick to complain about.

To many who see wind power as an expensive and inefficient gimmick, setting a goal of 30 percent by 2030 can seem relatively harmless. But that might not prove entirely true. The 30 percent goal could give wind developers an additional tool for confusing local officials and pressuring them into approving wind projects. There are already so many misperceptions used to promote wind power that even simply setting a goal can add to the muddle.

How transformative would it be if more people knew the basic facts about wind power? Two-thirds of what we call wind power is actually power generated from fossil fuels. There are no requirements in place to measure how much — or if — it lowers emissions.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.