Consumers Energy Wins Michigan Approval for $1 Billion Worth of Solar Power Contracts

The Michigan Public Service Commission on April 15 granted Consumers Energy Co.’s request for approval of 31 power purchase agreements for 394 megawatts of solar power. The contracts stem from September 2019 settlement between Consumers Energy and numerous developers of proposed solar projects in the company’s interconnection queue, resolving issues under the Public Utility Regulatory Policies Act of 1978. The agreements are for 20-year terms and are projected to cost about $1.04 billion.

The September settlement required Consumers Energy to enter into contracts with qualifying facilities for 170 megawatts of energy and capacity at the full avoided cost rates approved in a 2017 order and 414 megawatts at the Midcontinent Independent System Operator Inc. planning resource auction based avoided cost rates.

The latest approval, granted on an ex parte basis, is for the company’s submission toward the 414 megawatts of remaining projects. The power purchase agreements are utilize the avoided costs approved by the commission and will not affect rates or rate schedules and will not increase the cost of service to customers.

Under the 1978 federal law, independent generators that meet certain criteria based on size and technology, called qualifying facilities, are entitled to sell their output to regulated utilities at the avoided cost, or the cost the utility would spend to generate the electricity or purchase from another source.

Consumers Energy is a subsidiary of CMS Energy Corp.