Michigan regulators on Friday approved a major utility’s plan to phase out its coal-fired power plants and rely increasingly on renewable sources and energy efficiency to provide electricity.
Jackson-based Consumers Energy, which supplies power to much of the Lower Peninsula, won the OK after modifying a proposal it initially submitted a year ago.
Significant components remain unchanged, including a plan to retire two generators at the Karn plant near Bay City in 2023. The utility plans to close its final three units — at the Campbell plant north of Holland — between 2031 and 2040.
As part of a settlement, though, Consumers Energy agreed to study whether it can retire two of three units sooner, possibly as early as 2025.
“This truly ushers us into a new era for renewable energy in Michigan,” said president and CEO Patti Poppe. She told reporters on a conference call that the Public Service Commission’s blessing of the integrated resource plan “puts Consumers Energy on a path to eliminate coal, reduce carbon emissions by over 90% and meet our customers’ future electricity capacity needs with 90% clean energy resources by 2040.”
The utility currently has about 1,000 megawatts of capacity from renewable sources. It will add 6,500 megawatts of renewables by 2040, including 5,000 megawatts of solar during the 2020s.
The company initially proposed that all new power generation be competitively bid. The modified agreement calls for Consumers Energy to own up to half of future additional capacity and to buy the rest from third parties.
“There a variety of providers for solar energy. Given what a large role we see it playing in the future, we wanted to make sure that any of the new renewable energy we’re adding to the system is the best price,” Poppe said.
The utility also will boost energy-efficiency efforts, including by incentivizing customers to reduce their electricity use during peak periods.
Notably absent is any proposal for new generators to burn fossil fuels such as coal or natural gas, although the utility’s two existing gas plants in Zeeland and Jackson will remain online, eventually supplying about 10-15 percent of the power mix. A hydropower plant at Ludington also will continue to operate.
Consumers Energy was the first utility required to submit an integrated resource plan as required under a 2016 energy law.
Public Service Commission Chairwoman Sally Talberg called it a “significant milestone.” Environmental groups applauded the utility for its “bold plan,” noting its energy-efficiency plan is one of the most aggressive in the U.S. They also urged it to more quickly retire the Campbell coal units, which they said are the largest source of greenhouse gases and pollution in west Michigan.