Regulation, Utilities, Commercial, Industrial, Regulation, Sourcing Renewables - May 18, 2017
Michigan utility offers green tariff large energy users
Citing growing demand from large energy users for access to clean energy options, Michigan utility Consumers Energy has proposed a program to allow companies to match their load to renewable energy sources.
The CMS Energy subsidiary said May 15 that Switch's Pyramid data center in Grand Rapids is expected to be the first customer to utilize the program, which the utility has submitted to the Michigan Public Service Commission for approval. Once approved, the program will be used for Switch's 1.8 million-square-foot data center, which opened in March, to be 100% powered by renewable energy, according to a news release from the utility.
According to Crain's Detroit Business, Garrick Rochow, Consumers Energy's senior vice president for distribution and customer operations, said in a telephone press conference about the program that Switch will receive electricity through an addition to the 111-megawatt Cross Winds Energy Park wind farm in the Michigan Thumb region. Consumers is reportedly planning to add 44 MW with 19 turbines this year, and possibly an additional 76 MW by the end of 2020, depending on customer demand, according to Crain's.
"In short, the new program helps entities like Switch adhere to the renewable principles of additionality (new renewable resources) and locality (resources that benefit the regional grid)," the utility said in its release.
Under the proposal to the MPSC, Consumers has submitted an application called a "green energy rider tariff." The tariff is a utility program that would allow customers to source up to 100 percent of their electricity from renewable sources located on their grid. Currently, utility customers receive renewable energy credits for producing the green power. The tariff is expected to be a long-term lease of five years with a three-year renewable provision. The power purchase agreement, allowed by the tariff, would fix electricity prices during that period, saving Switch on future price increases, Kramer previously told Crain's.
Consumers said the program will initially be a pilot, with the option to expand if there is increased customer interest. The utility expects the state utility commission to take up to six months to review and approve the green tariff, according to Crain's.
Switch and Consumers had been working together for some time on a deal that would support the data center company's commitment to using 100% renewable energy to power its operations. The utility said the program offers a blueprint for Switch and other Michigan businesses that make renewable energy commitments.