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By Jason Hayes
In 15 months — November 2018 — Michigan residents will elect a new governor. To date, there has been very little discussion on the policies the next governor should promote to ensure Michigan residents continue to enjoy a clean, healthy environment and access to affordable, reliable and clean energy.
As we look forward to next year’s race, the Environmental Policy Initiative suggests the following five key energy and environmental policy ideas as the place for an incoming governor to start.
1. Eliminate Michigan’s renewable energy mandate
Renewable energy advocates have made two very clear pronouncements: First, they are convinced that, regardless of what energy policies might be implemented at the state or federal level, renewable energy is here to stay. Second, they argue that, with advances in renewable technologies, renewable energy is competitive with, and in many cases less expensive, than other energy options.
Our next governor should take renewable energy supporters at their word. If renewable energy is competitive and here to stay, it should have no difficulty competing with other energy sources without special government favors, mandates or protection. Eliminate the state’s renewable portfolio standard.
2. Expand electricity choice
Since Michigan effectively re-established a regulated monopoly system of energy distribution in 2008, electricity prices have rocketed upwards. According to the Energy Information Administration, at 15.3 cents per kilowatt hour, Michigan had the highest retail electricity rates in the Midwest in 2016. But when Michigan’s electricity market was open to competition, we led the pack on keeping price increases down.
Our next governor should remember that electric monopolies discourage competition, keep prices high and diminish electricity reliability. Competition and free markets, which exist only in Michigan’s “electricity choice” markets, benefit Michigan residents by providing low-cost, reliable electricity. Remove the 10 percent cap on Michigan’s electricity choice markets, let people choose their electricity provider and make energy producers compete.
3. Keep a level head about Line 5
There is an intense debate over the safety and long-term reliability of the pipeline, Line 5, that traverses the Straits of Mackinac. The Great Lakes are an important international resource and Michigan’s government must take every reasonable step to protect water quality.
At the same time, the energy resources transported by Line 5 are essential to meeting energy needs across the state of Michigan, meaning demands to “shut it down” are simply not realistic. Line 5 has undergone strict testing, maintenance and inspections under the supervision of state and federal government agencies. Those tests have yet to identify safety concerns sufficient to close or limit its use.
Our next governor should take the lead in ensuring Line 5 continues to operate safely. Or, the next governor should ensure we have realistic, workable options in place to replace Line 5 with newer, even safer and more reliable equipment.
4. Make Michigan a natural gas hub
The Energy Information Administration reports that, with 1.1 trillion cubic feet of underground storage in 2015, Michigan had more capacity to store natural gas than any other state.
Our next governor should recognize that Michigan’s geology and location — near to northeastern states that are increasingly turning to natural gas as a primary fuel source — makes us a natural hub for those rapidly expanding natural gas markets. Additionally, major companies, like Dow Chemical, rely on a steady and affordable supply of natural gas for their daily operations. Make it a statewide goal to increase Michigan’s ability to transport and store natural gas.
Additionally, Michigan was 18th and 19th in 2016 for oil and natural gas production, respectively, out of the nation’s 32 oil producing states. Our next governor should also ensure that permitting and taxes do not discourage energy companies, already pressured by low oil and natural gas prices, from operating in Michigan.
5. Stop arbitrary environmental regulation decisions
Our Detroit News op-ed, “A state-made wetland problem,” described how arbitrary DEQ decisions cost one Michigan business owner hundreds of thousands of dollars in legal fees and years in court over an issue regulators later said had literally evaporated. Many other Michigan business owners and land owners have made similar complaints about the DEQ overexerting their regulatory authority.
Our next governor should recognize the value of a healthy, thriving business community to Michigan’s economy. Essential environmental protection is an obvious need, but arbitrary regulatory decisions can harm the state’s environmental and economic health. Adopt a standard that requires Michigan’s Legislature to approve any environmental regulations that go beyond federal standards.
