Initial Statewide Energy Assessment

The Initial Statewide Energy Assessment has been submitted to Gov. Whitmer and is now available online Michigan Statewide Energy Assessment Initial Report. In January of 2019, the polar vortex and fire at the Ray Compressor Station prompted the Governor to request the Michigan Public Service Commission (MPSC) to undertake a statewide review of the supply, engineering, and deliverability of natural gas, electricity, and propane systems, as well as contingency planning related to those systems.

The Initial report has found that Michigan’s energy supply and delivery systems are adequate to meet customer needs. The report also makes 36 recommendations for the MPSC, regulated utilities, policymakers, and others which would add resiliency to the state’s energy systems.

“This detailed State Energy Assessment provided the opportunity for the Commission to examine whether Michigan’s residents and businesses are able to receive safe and reliable energy service during times of great challenges due to abnormal weather and untimely system failures,” said Sally Talberg, chairman of the Commission. “The Commission Staff examined both shortcomings and strengths of the electricity, natural gas, and propane sectors. Overall, the energy system is strong, but would benefit from increased resilience, strengthened infrastructure interconnections, and improved communication.”

Statewide Energy Assessment Fact Sheet

A final report is due to the Governor by Sept. 13. 

Among the initial assessment’s findings:

  • Michigan has sufficient and unique assets that help ensure reliable supply and delivery of energy to help meet peak demand.
  • Market structures and regulatory oversight ensure needed investments are made in energy supply and delivery.
  • Although Michigan’s energy infrastructure is designed and operated to maintain energy supplies and deliver during emergency conditions, there is an inherent risk of disruption due to security threats, extreme weather, changing electricity supplies, and other factors.
  • While the probability of a major emergency that disrupts energy supplies is low, such events could have a high impact on the economy and well-being of Michiganders.
  • The polar vortex and Ray fire highlight the need for continued vigilance in assessing Michigan’s energy landscape and emergency management response systems.

The initial assessment’s major recommendations:

  • Undertake long-term risk-based, integrated natural gas maintenance and infrastructure planning that includes storage, transmission, and distribution assets as well as long-term risk mitigation plans.
  • Better integrate five-year distribution and transmission plans as part of utility integrated resource plans to ensure truly integrated electricity system planning. This should include examining options to expand Michigan’s electrical connections between its peninsulas and with neighboring states.
  • Work with stakeholders to understand the value of resource supply diversity to better inform decisions related to power plant development, retrofitting, and retirement beyond traditional planning and financial analyses.
  • Identify revisions to natural gas utility curtailment procedures to prioritize home heating over electric generation.
  • Improve electric demand response programs since some customers did not respond as expected during the polar vortex and utility tariffs were inconsistent. Also, natural gas utilities should develop similar programs as an alternative to broad emergency appeals.
  • Enact rules for cyber security and incident reporting for natural gas utilities.
  • Expand emergency drills to provide a range of scenarios besides outage management and restoration. Communication related to the Ray event and the polar vortex was confusing, inconsistent, and erratic.
  • Develop a formal contingency plan for the continued supply and delivery of propane or other energy alternatives in the event of supply disruptions, including a temporary or permanent shutdown of Line 5.
  • Continue to solicit propane market information from suppliers and create an annual retail propane survey to monitor market trends and gain market insight.

 

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