Capital Area Sustainability Partnership Community Solar Feasibility Study

December 4, 2024

In 2022, the Michigan Public Service Commission (MPSC) received one-time appropriations for the purpose of developing a novel grant program to support businesses, nonprofit organizations, and local governments in the development and acquisition of low-carbon energy infrastructure and generation technologies (MPSC n.d.). The MPSC released a request for proposals in September 2022 divided into two distinct categories: infrastructure projects—which focused on larger-scale, “shovel ready” projects for which funding could support significant deployments of low-carbon infrastructure—and planning projects—focused on early-stage development projects to help applicants research and plan for future low-carbon deployments.

In response to this unique opportunity from the MPSC, Public Sector Consultants (PSC), in partnership with three member communities of the Capital Area Sustainability Partnership (CASP)—City of Lansing, City of East Lansing, and Meridian Township—successfully sought a planning grant to examine the development of a novel multijurisdictional approach to the deployment of community solar that uses municipal buildings as anchors. Each of the CASP partners expressed keen interest in piloting a multijurisdictional community solar approach that would reduce municipality, resident, and business energy expenditures, accrue carbon emissions reductions, and decrease low-income residents’ energy burdens.

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Key Findings and Recommended Approach

Through the project activities, PSC uncovered a range of key findings that could influence future pathways of the CASP partners as well as other municipalities and institutions interested in implementing community solar in Michigan.

Those key findings are:

Surveyed members of the public in the Lansing area expressed a keen interest in seeing their
municipality develop a community solar program and participating in community solar projects provided the cost and benefits fall within ranges that meet their individual needs.
When total societal costs of power generation are considered, community solar is financially
beneficial from both an institutional stakeholder and individual member/beneficiary perspective.
Developing and owning alternative energy installations can infer substantial financial benefits, including access to grants and federal tax credits.
Community solar providers profiled in our research who engaged their community in the project planning and design were more successful in attracting investors/members and providing benefits that met or exceeded the costs of participation than those providers who did not.
Legislation allowing non-utility entities in Michigan to offer a community solar subscription, and provide utility bill credits to customers, has been proposed multiple times but has not been codified in law and was notably excluded from the most recent legislative package that enacted sweeping changes to Michigan’s energy laws.
Current Michigan law makes it possible to create a corporate entity with multiple membership classes that can own a solar array, provide different levels of benefits based on ownership type, and contract for the construction and maintenance of the solar array. Thus, a structure mimicking the benefits of community solar is possible, despite the lack of specific enabling legislation in Michigan. Benefits under such an arrangement would be provided to system participants/owners outside of their utility bill.