The Michigan Public Service Commission has just issued a report
on "net metering" in the state during the last six months of 2009. The press
release that accompanied the report chirped that the number of net
metering electricity customers increased by 85 percent during
that period, from 135 to 254. With a few exceptions, most of these small
generators make electricity with wind turbines and solar collectors.
"Net metering" is a clever practice in which an electricity
customer who also generates some juice can sell it back to the utility by
essentially "reversing" the flow. The customer is then charged only for the
"net" of electricity purchased from the utility
minus electricity sold to the utility.
It's more complicated in practice, and potentially adds
to the challenges power companies face in planning how much they need to
generate. For this reason, net metering is heavily regulated by statute and
Michigan Public Service Commission rules that impose limits and price controls.
For example, DTE is required to offer net metering
connections under terms that generally favor the customer, but is not required
to acquire any more than 1 percent of its total capacity from them.
Therefore, even if dispersed renewable power generation became much
more cost-effective than currently, net metering would never replace more than a
fraction of the total electricity required to keep Michigan's homes, shops and
This reality is reinforced by the details of the new
MPSC report, which reveals the potential amount of power those 254 net metering
customers can provide — at least during the hours the sun shines, the wind
blows, etc. — is just 884 kilowatts. Therefore, if the wind blew steadily and
the sun shone non-stop for 12 hours a day — they won't, but it's useful to set the
outside boundary — these net meterers might produce 3,871,920 kilowatt hours of
According to the U.S.
Department of Energy, Michigan's total electricity
consumption is 110,445,000,000 kilowatt hours each year (110.4 billion). This
is 28,524 times more than the maximum potential output of all the state's
current net-metering providers. Under current law, net metering could legally
provide around five times more electricity, which would potentially bring
it up to 1/5000 of Michigan's needs, even under the most
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