They represent clean and limitless sources to produce energy.
Yet using the sun and the wind to generate electricity remain largely passing curiosities for many people, their long-term benefits outweighed by the up-front costs — and that’s for those who are even aware of what’s available.
That point is driven home to Mark Tuttle, owner of Solar Works, a Sand Lake company that sells and installs solar energy systems, whenever a potential customer seeks financing to install a solar or wind energy system at their home or business.
“Today you can’t go to a loan officer and ask them for a loan, like you can for a car, for a renewable energy system. It’s not a tangible thing,” said Tuttle, who’s also president of the Great Lakes Renewable Energy Association.
State energy regulators hope to change that lack of understanding through a proposed initiative that seeks to boost the amount of energy produced in Michigan through solar, wind, hydroelectric and other renewable sources.
Most of the comments the Michigan Public Service Commission received on its proposal support the notion of a state renewable energy program, although ideas vary on how to go about formulating an initiative to promote renewable energy sources for small-scale residential and broader commercial use. Additional tax credits and other financial incentives and the creation of capital funds are largely seen as a way to boost the development of new renewable energy facilities.
The MPSC will use the comments as it finalizes a renewable energy program. A decision is expected “as quickly as possible,” MPSC spokeswoman Mary Jo Kunkle said.
Many of those offering views on the MPSC’s proposal cited a lack of funding and awareness as two significant obstacles to overcome. An education component designed to increase consumer demand for renewable energy is crucial to any program, which in turn would generate the capital needed to develop new energy sources, they said.
Renewable energy sources presently account for just 3 percent of the electricity generated in Michigan, and much of that comes from hydroelectric dams and the burning of landfill gases. MPSC staff, in their proposal, concluded that “renewable resource technologies have the potential to contribute significantly to electricity supplies in a cost-effective and environmentally sound manner.”
While generally skeptical of whether state government can do much for the private sector, Tuttle hopes that an MPSC renewable energy initiative can at least build public awareness. Whatever the MPSC builds into the program, it needs to provide enough support to ensure the industry’s sustainability and identify ways to break down barriers hindering the greater use of renewable energy sources, he said.
“What you want to do is create a market that can stand on its own two feet,” Tuttle said.
Many believe that the renewable energy industry can stand tall in the near future, if provided the proper nurturing.
Forces are now beginning to come together to drive a growing interest in renewable energy and its ecological benefits: global warming, the California energy crisis and a decreasing cost to generate electricity through renewable sources.
Those dynamics, as well as a growing interest among energy regulators, have brightened the industry’s future prospects, said Craig Brumels, technical manager for Michigan Wind Energy LLC. Brumels and a partner, Greg Walstra, are working to develop a wind turbine on acreage near Little Sable Point in Oceana County.
“I’ve just been biding my time. I’ve been waiting for this to all come together,” said Brumels, who’s been involved in the industry for about 20 years and once taught wind energy at the former Jordan Energy Institute in Comstock Park. “From a regulatory and a consumer point of view, this just hasn’t been able to happen until now.”
The MPSC proposed the Michigan Renewable Energy Program this past spring in accordance with a provision included in legislation enacted last year to deregulate the state’s electric industry. The law requires the MPSC to develop a program to educate consumers about the availability and environmental benefits of renewable energy, as well as promote its use and the development of new facilities.
The benefit of such a program is the tremendous potential to reduce pollution and diversify the state’s electric generating capacity, according to the MPSC proposal that seeks to build on successful renewable energy ventures already in place in Michigan.
Seeing a tremendous potential and a growing consumer demand for “green power” in the future, Richard Vander Veen, head of Bay Windpower LLC, a Grand Rapids company that is developing wind energy projects in West Michigan, is trying to recruit private investors.
While a state program can help, the future of renewable energy relies on private investment, Vander Veen said.
“It’s fine for the government to set a framework, but it has to come from the private sector,” said Vander Veen, who believes that tide has begun to turn in the industry’s favor.
“We think there’s a growing basis to be optimistic. There’s a lot of value in what we’re doing,” he said. “I’d say we’re on course.”
But the ecological concerns of generating electricity through the burning of fossil fuels collides directly with the still comparatively higher cost of renewable energy. Those costs, combined with engineering issues to connect a renewable energy venture to the state’s electrical grid, pose significant challenges to the higher use of renewable energy sources.
“Increased utilization in Michigan is expected when the cost to develop renewable facilities is deemed economical and regulatory and technical issues are resolved,” the MPSC’s proposal states.
Walstra, of Michigan Wind Energy, says the comparative cost of producing energy through wind or solar sources tends to steer many people away from it.
“Everybody says green power is great — ‘We want green power’ — but they still care about the cost. Nobody is willing to pay more,” Walstra said. “A lot of people are talking about it, but nobody is stepping up to the plate.”
The cost differentials, however, are closing. Producing a mega-watt of electricity through wind costs 3 cents per kilowatt hour — about half of what it cost six years ago, according to the National Renewable Energy Research Laboratory. That cost falls to 1.7 cents per kilowatt hour when a federal tax credit is figured into the equation, a cost that nearly rivals that of coal.
Power produced through photovoltaics, or solar energy cells, ranges from 20 cents to 25 cents per kilowatt hour.
While lower than renewable sources, the cost of generating electricity through the burning of fossil fuels does not take into account the ecological problems caused from pollution and the associated human health issues, renewable energy advocates say.
There are also some indications that consumers are changing and becoming increasingly willing to pay a little more for electricity generated through renewable energy sources.
About 200 customers of Traverse City Light and Power pay an additional average of about $7.38 a month for power generated through a wind-powered turbine erected in 1996, which represents just a fraction of the municipal utility’s generating capacity, according to the MPSC proposal.
The Lansing Board of Water and Light is also developing a “green” rate for customers, 49 percent of whom have indicated in surveys that they are “extremely favorable” to the idea, the MPSC reports.
Vander Veen believes that after years of relative obscurity, renewable energy is catching on with consumers because of its environmental benefits. Developing a non-polluting alternative to coal, natural gas and nuclear power is a major selling point in his pitch to potential investors, he said.
“Who are we as this generation to spoil the earth? We need to think about future generations,” he said.
But even if consumers and businesses embrace green power, and investors are willing to put up the money to develop new operations, few believe that renewable energy will ever replace fossil fuels as the primary source of electric generation.
Both solar and wind are only effective in favorable weather conditions, which leave them mostly as complementary rather than primary generating sources for the current electric system, Brumels said.
“I don’t think it’s viable to ever say that you can supply all of Michigan’s power with solar or wind,” Brumels said. “It’s a supplement.”
That’s much the same conclusion of a West Michigan municipal utility that wants to study the potential of wind energy.
The Holland Board of Public Works plans to look at a joint project with a consortium of other municipal utilities in Michigan. While viewing renewable energy as “not the answer to everything,” the BPW still believes it does hold promise and is worth examining, General Manager Tim Morawski said.
“You have to give some support to get to that viability,” Morawski said. “Any technology, unless you pursue it, doesn’t have a chance to mature to its full functionality.”