In 2008, former Gov. Jennifer Granholm signed the Clean, Renewable, and Efficient Energy Act, which requires all state utilities to generate ten percent of all retail electricity sales from renewable sources by 2015. Qualifying sources include solar, thermal electric, photovoltaics, landfill gas, wind, biomass, hydroelectric, geothermal electric, municipal solid waste, coal-fired w/CCS, gasification, anaerobic digestion, tidal energy, wave energy. Energy efficiency programs, which result in decreased consumption, also qualify.
Compliance for the standard begins in 2012 and rises on a gradual scale to 2015. The compliance requirements are different for each state utility based on their existing portfolio of renewable energy, the amount required to meet the overall 10 percent requirement in each compliance year, and the percentage requirement for that year.
Large utilities must also meet a renewable energy capacity standard. Utilities with over 1 million customers must meet a renewable capacity of 500 megawatts (MW) by 2015, and utilities with over 2 million customers must meet a capacity of 600 MW by 2015.
Utilities may meet the overall RPS standard by purchasing renewable energy credits (RECs), energy optimization credits (EOCs), and advanced cleaner energy credits (ACECs). The Michigan Public Service Commission set limits on the amount of RECs, EOCs, and ACECs, which may be used to meet the RPS. Bonus credits are assigned to energy produced from certain sources renewable energy. For example, electricity generated from solar receives 2 bonus credits per megawatt hour.
The law also sets an energy optimization standard for electricity and natural gas. By 2012 electric providers must meet a one percent savings from the previous year. In 2012, natural gas providers the requirement is 0.3 percent savings from the previous year.
Source: Database of State Incentives for Renewables and Efficiency