MICHIGAN BIOMASS NEWS

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Keep cool Michigan: Biomass has your back

There going to be a lot of debate in Lansing this year on how to make up a projected shortfall in electrical generation capacity starting next year as new regulations force power companies to pull coal-fired power out of the mix because it doesn’t make economic sense to upgrade emission controls on those 50-year-old plants.

The big winner will likely be natural gas – a clean and abundant source of energy, some of which comes from right here in the Great Lakes state. But, there’s another affordable solution: biomass.

Ensuring there’s enough electricity to go around – especially during peak usage periods like the middle of summer – is a big part of the nation’s power infrastructure. “The Grid” can’t store energy in giant batteries to save for those times when people crank up their air conditioners and freezers work overtime to ensure there is ice for everyone’s tea – sweetened, if you happen to be from the South.

That means electric companies need the ability to turn up the power when people want it most, or to supply backup power when major storms cause disruptions in service. “Capacity” in power sector terms means the ability to generate as much power as is needed, precisely when it’s needed. That means having a little extra on the side for those “just in case” moments.

Starting next year Michigan will begin to fall short of the capacity that regulators say is necessary to ensure power stays on when temperatures soar and storms rake across the state. That’s because the state’s power producers will begin to shut down coal-fired plants that can’t economically meet new U.S. EPA air standards.

Biomass power provides “capacity” just like natural gas. Electricity produced from sources like, tree tops left from timber harvest, and crates and pallets diverted from landfills isn’t affected by these new environmental rules and will continue to bring cost effective reliability to Michigan’s electricity customers, just like they’ve been doing the past 30 years.

So, this summer you can sit back, relax and enjoy that second tall glass of tea, knowing that biomass power producers in Michigan will make sure there’s plenty of ice to keep you and your beverages cool as a cucumber.

Biomass is baseload for the future

The house Energy & Technology Committee in March conducted two days of marathon hearings on HB 5542 that would allow Michigan ratepayers to shop for their power, but allow regulated utilities to maintain their monopoly on the distribution of that power. It made for great theater, with the television lights, the pointed questions from the committee and the barbed and sometimes defensive responses from those at the witness table.

The choice debate is about one thing, and one thing only – rates. Large commercial and industrial ratepayers say Michigan’s rates are too high and competition will lower them. Others say opening the marketplace will lead in the opposite direction – higher prices and less reliability. Both sides lean on the same data and information to support their position, and presented examples of successes and failures from other states.

No one, however, disagreed with one point made repeatedly during those hearings: new US EPA air standards are forcing the closure of aging coal plants, and with those closures comes the loss of baseload generating capacity critical to reliability.

Some think Michigan should put its energy eggs in the natural gas basket, but they also know it only takes one hiccup to drive up gas prices, leaving ratepayers holding the bag.

As qualified small power facilities, biomass plants don’t have those limitations and bring reliability and diversity to the state’s energy portfolio.

Biomass is part of the solution. Where ever energy policy discussions go, biomass power needs to be part of a diverse energy portfolio that will best serve Michigan consumers.

Biomass is Worth Public Investment

In January Michigan oil interests testified before the Michigan House Energy and Technology Committee on a trio of bills to promote enhanced oil recovery (EOR), which employs various extraction technologies to draw the last bit of oil from a reservoir. It’s the tough-to-get-at stuff conventional drilling leaves behind.

Additional oil extraction would contribute to energy independence, Michigan jobs and better economics.

Biomass does all these things, too.

According to the Dept. of Treasury, these so-called “stripper wells” in FY 2013 produced 2 million barrels (27% of total net production) and generated $10.5 million in severance tax revenues. Michigan could produce more oil from these marginal wells – up to 200 million barrels over their lifetime – if the extraction costs were lower, like lowering the severance tax on that oil. HB 4885 would cut it in half.

Biomass is Michigan-made domestic energy. It creates Michigan jobs and supports rural economies and the local tax base. It relies on “leftovers” like forest residuals and wood scraps from diverse and distributed sources, which can be tough-to-get-at stuff.

We’ve been doing it for 30 years, without subsidies or other specific public investment. And because wood is a renewable resource, we’ll never leave because the well ran dry.

That’s a pretty good deal for Michiganders and warrants support in state energy policy.

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