MARQUETTE — The third of three statewide public hearings drew about 40 people to the campus of Northern Michigan University Tuesday for an issue of unique significance to the Upper Peninsula, as well as the entire state — ensuring affordable, reliable energy into the future.

As part of new legislation signed late last year with bipartisan support, the Michigan Public Service Commission, with input from the Michigan Agency for Energy and the Michigan Department of Environmental Quality, is required to set modeling parameters and assumptions for utilities to use in filing “integrated resource plans.”

Under the new law, rate regulating utilities are required to submit IRPs to the MPSC every five years, detailing how they will meet customer electricity needs.

Before finalizing IRP parameter requirements, the MPSC is soliciting public feedback regarding its strawman proposal via public hearings and written comments.

A number of individuals spoke Tuesday to thank the MPSC for the transparent process and to comment on the need in the strawman proposal to improve requirements around energy waste reduction, risk assessment, the growing prevalence of renewable energy technology, and more.

Norman Saari, a commissioner on the three-member MPSC, sat on the panel that heard comments from noon to 4 p.m. in the Huron/Erie Rooms of NMU’s University Center.

“Our commitment today is to hear from you. This isn’t a debate, this is an opportunity for the commission staff to understand better the perspectives you have on this program,” Saari said.

Bonnie Janssen, MAE engineer specialist, said meetings started in March involving more than 30 stakeholder organizations. Nine separate workgroups collaborated on: demand response, energy waste reduction, environmental policy, filing requirements, fuel price forecasting and reliability, other market options, renewables, transmission and the Upper Peninsula.

Reports from these workgroups formed the basis for the strawman proposal.

“We made a unique one for the (U.P.) because we are more market sensitive on fuel pricing,” Janssen said. “For example, natural gas is really key, so if natural gas prices go up to … (certain levels), that would really make renewables much more favorable, and energy waste reduction is always key at just about any price under the IRP.”

The new energy laws, Public Act 341 and Public Act 342, were passed in December and took effect in April.

According to the MAE, the laws allow for a quicker review of utility rate cases, require electric providers to prove they have enough resources to serve customer needs, preserve electric choice, increase to 15 percent by 2021 the amount of power produced from renewable resources, encourage utilities to set up green pricing programs, support energy waste reduction, allow for on-bill financing of home improvement projects, and maintain net metering options.

Dan Scripps, vice president of the Michigan Energy Innovation Business Council, said cost effective waste reduction, modeling of non-utility resources, growth of storage technology, opportunities in distributed solar, cogeneration and expanded risk scenarios need to be central to IRP requirements.

“Renewable energy, particularly resources like wind and solar, that don’t have ongoing fuel costs can provide an effective hedge against fuel volatility and also could save ratepayers money,” Scripps said.

Jennifer Hill, energy consultant with Upstream Consulting, also talked about those concerns, as well as consideration of more extreme weather events in the future.

“My over-arching comment is that the future of energy is going to look very different and to urge MPSC to require that utilities do more to explore the cost and benefits of leveraging what exists and make it possible for the U.P. to take advantage of its strengths and build a cost-efficient, environmentally beneficial, reliable energy system,” Hill said.

Joanna Lewis, program administrator for the Michigan Conservative Energy Forum, talked about the need to lower rates, saying transmission and energy conservation needs to be a major focus for IRPs. She also talked about job growth in the clean energy sector.

“Our state’s transition to clean energy will make us more competitive in both the national and global energy economies, helping to lower rates and draw significant investment to Michigan,” Lewis said. “While this transition is inevitable, we must work to make it as seamless as possible, ensuring reliable, abundant and affordable energy in the meantime.”

Douglas Jester, partner at 5 Lakes Energy, talked about the uniqueness of the U.P., with utilities serving mostly mines and mills, and a much smaller fraction of generation serving everyone else.

“I suggest that it is very important in the case of the (U.P.) for utilities to evaluate their plan with and without each of these major loads. These are mostly commodity businesses. Commodity markets are highly volatile and we have certainly experienced that some of these mines and mills close, and that others come in with very large load increases,” Jester said. “That is an essential part of the landscape of the (U.P.) energy situation that needs a specific analysis.”

Gary Talarico of Germfask, who is currently suing Upper Peninsula. Power Co. over rising rates, asked that IRP requirements go into effect before Upper Michigan Energy Resources Corporation follows through on plans to build two new plants.

“And who will pay for these? The people of the U.P. From what I’ve been able to read online, these plants are being built to serve the Cliffs mine. That’s fine. But I shouldn’t have to pay for them,” Talarico said. “It looks to me like the mines will take 70 percent of the power of these two plants, but only pay for 50 percent of them, leaving folks like me and others having to pick up the difference. Maybe I’ve got this all wrong … but this seems to me to amount to an unfair subsidy.”

Deadlines to comment on the strawman proposal for IRP parameter requirements are Oct. 6 for initial comments and Oct. 20 for reply comments.

Anyone can mail comments to Executive Secretary, MPSC, PO Box 30221, Lansing MI 48909; or email comments to MPSCDockets@michigan.gov.

Be sure to include Docket No. U-18418 in the subject line.

Mary Wardell can be reached at 906-228-2500, ext. 248. Her email address is mwardell@miningjournal.net.