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PSC Approves Part Of Consumers Energy's Program To Offer Large Businesses 100% Renewable Energy

August 24, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Michigan PSC approved one of the options proposed by Consumers Energy under its Voluntary Large Customer Renewable Energy Pilot Program (VLC), which will offer large businesses the opportunity to purchase 100 percent renewable energy.

In brief, business customers who use at least 1 MW of power annually qualify for the pilot green pricing program. Participants can designate how much of their energy use -- from 20 percent to 100 percent -- to match with energy produced from a Consumers-owned wind turbine facility. Participating customers pay a fee of 4.5 cents per kilowatt hour above their regular rates and receive a market-based credit for the wind energy.

More specifically, the PSC approved, at this time, "Option A" under Consumers' VLC pilot. The PSC noted that Option A is a more traditional renewable energy program. Customers selecting this option pay the full service tariff rate as well as a per-kilowatt-hour subscription fee. The subscription fee is designed to cover the costs of renewable energy service, and, in return, the customer receives a corresponding renewable credit based on the value of the renewable energy and capacity per the Midcontinent Independent System Operator, Inc. (MISO) market. If a customer subscribes 100% of its energy usage to the VLC Pilot and takes service under the General Primary Demand Rate Schedule, then the customer qualifies to elect a real-time hourly pricing rate. The subscription fee covers the cost of construction, operation and maintenance, return of equity, financing, property taxes, insurance, and substation costs, and participants are required to pay all applicable power supply, delivery, transmission, and surcharges for their entire load.

The PSC deferred consideration of an "Option B" which Consumers had also proposed. Option B customers would have the same options as described for Option A customers, but would have a different application of the real-time hourly pricing rate. Option B customers who choose the real-time hourly pricing rate would be responsible for securing their own power purchase agreements and offering the energy from that resource into the MISO market for payment.

"The Commission defers consideration of Option B to the Section 61 filing [a required filing concerning renewable energy offerings under the state's recent energy law] and will include a determination of whether Option B is approved in the context of a Section 61 proceeding," the PSC said

Case No. U-18393

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