SBAM public policy positions are developed for and by small business owners and aim to foster an environment of success around our entrepreneurs and small businesses. Our Legislative Action Council recently revisited our current energy policy in light of an impending energy rewrite on the table of the legislature.
Our core pillars are as follows:
Affordability: Energy policies should seek to mitigate the effects of rising energy costs and encourage affordability and competitiveness for small businesses in Michigan. These policies must be economically feasible, protecting small businesses from high energy rates, along with being technologically reasonable. Energy policies and regulations should not be synonymous with aspirational goals that rely on yet-to-be invented technologies or concepts not commercially available/viable.
Reliability: Our economy requires reliable energy to function. It should operate in the background for small business owners without concern of availability on hot summer days or during winter storms. Outages, blackouts and brownouts lead to unpredictability and disruption of business, sometimes for extended periods of time.
To ensure reliability, our grid must be resilient. SBAM advocates for investment in infrastructure modernization and maintenance to ensure the availability of energy required for businesses to flourish. Another key feature of a resilient grid is the use of diverse energy sources with a reliable base that are always available by building out a strong portfolio.
Rate Setting: The state should ensure that energy consumers pay a rate that is commensurate with actual use, rather than favoring certain consumer classes. Economic development rates which give special pricing to certain consumers should not shift energy costs to small businesses.
Carbon Reduction: To the extent that the state continues to pursue policies that reduce carbon emissions, these policies need to be balanced against factors such as affordability and reliability, which both impact Michigan’s competitiveness and economic growth potential. There should also be reasonable transition periods and incorporation of generally accepted practices of carbon offsets and sequestration.
Decentralized or Distributed Generation: State policy should accommodate small businesses that decide to generate their own electricity. Small businesses have varying reasons for generating their own electricity, including reducing their reliance on traditional power sources, controlling more of their costs and taking individual steps to reduce their carbon footprint. Those who choose to generate their own electricity should have the opportunity to remain connected to the grid and be able to participate in net metering opportunities with reasonable rates. With the introduction and passage of SB 271, 273 and 502, small businesses face significant hardship and have already faced substantial cost increases in recent years. Furthermore, we fear Michigan will diminish its competitiveness in attracting new investment due to the anticipated negative impacts on affordability and reliability.
Small businesses and entrepreneurs are largely responsible for Michigan’s strong economic performance coming out of the pandemic. Policies that increase costs, pick winners and losers and decrease the reliability of the energy portfolio put our eco- nomic health at risk.
Here are the major issues SBAM has with this package of bills:
- Does not balance renewable energy mandates against the need for energy to be affordable and reliable.
- Does not preserve the integrity of the Integrated Resource Plan approval process and includes rigid timelines and restrictions.
- Relies on technology not yet available or proven to be reliable and affordable.
- Expands regulatory powers to unelected political appointees.
- Cuts small construction companies out of renewable energy projects by requiring prevailing wage regulations on energy construction.
While we are disappointed the legislature chose to rush through the process with little stakeholder engagement—and we anticipate the governor to sign the bills as passed—we will continue to advocate for sound energy policy that does not put the burden of cost on the backs of small business owners. We want to thank all of you who participated in our call to action on this subject. Tune in for more legislative news by visiting www. sbam.org/advocacy.
By Kelli Saunders, originally published in SBAM’s January/February 2024 issue of FOCUS magazine
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