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Is Michigan’s constitution the right place for energy policy?

(Photo by Maia C. via Creative Commons)

Is it a good idea to incorporate a renewable energy mandate into a state’s constitution? It’s a hotly contested question in Michigan, where voters will soon decide on a ballot initiative called Proposal 3 that would make the state the first to do so.

Opponents, led by a group that has received millions of dollars from the state’s two large investor-owned utilities, say it’s inappropriate to use the state constitution to make energy policy, and that, if passed, the amendment could lock the state into wind power for decades, limiting Michigan’s future energy options in a rapidly changing industry.

But environmentalists, some unions, and wind energy advocates say it’s the best way to circumvent the power of utility special interests and achieve the renewable energy Michiganders want. The amendment, they argue, actually offers more long-term flexibility than other legislative options.

Twenty-six states have passed renewable energy mandates, but in each case a bill moved through the state’s legislature and was signed by a governor. Michigan’s Proposal 3, in contrast, would amend the state’s constitution to require that 25 percent of the electricity in the state by generated from wind, solar, biomass and hydroelectric sources by 2025.

The online environmental magazine Grist called the measure, which is known informally as 25 by ’25, “the most important clean-energy vote this year.” And proponents and opponents of the measure have spent millions on television ads accusing each other having shadowy benefactors and making dishonest claims.

“We are the only clean-energy ballot proposal going on in the country this election cycle. Anybody working nationally in renewable energy is putting money in,” says James Clift, policy director for the Michigan Environmental Council

Giving the public a say

Michigan’s legislature passed the state’s first renewable energy standard in 2008, at a time when there was broader political momentum nationwide to address climate change. The law had a modest goal of achieving 10 percent of the state’s generation from renewable sources by 2015. By all accounts, the state is on track to meet that goal.

In late 2011 environmental groups huddled and decided that Michigan, with its abundant renewable resources, strong manufacturing base and history of broad support for renewable energy, was their best state to advance renewable energy further during the 2012 election cycle, said Sam Gomberg, an energy analyst with the Union of Concerned Scientists (UCS) in Chicago.

To make that happen, they formed a coalition of state and national green groups, labor unions, businesses and wind energy advocates called Michigan Energy, Michigan Jobs (the coalition includes Fresh Energy and several other members of RE-AMP, which also publishes Midwest Energy News).

“We know nothing is going to happen in D.C. for some time. We saw that Michigan could really benefit and there was strong [local] support. So we saw Michigan as one of the key states where everything was aligned and we could move the country forward,” Gomberg said.

The next question was how. They could try to move a bill through Michigan’s legislature, but legislative leaders had made it clear they were not willing to revisit the renewable energy standards until 2015, Gomberg said. So the group decided to take the question directly to voters.

Why an amendment?

Michigan is one of 21 states that allow citizen-led ballot initiatives to change state law, and also one of 18 states that allow ballot initiatives to amend the state’s constitution.

The coalition considered a ballot initiative to change state law. In most of the states where ballot initiatives are allowed, a citizen-led initiative becomes law when citizens gather enough signatures on a petition, then approve the initiative on Election Day.

But Michigan is one of two states that do it differently, Gomberg explained. Once citizens gather enough signatures, the measure then goes to the state legislature. The legislature then has 40 days to act on it. If they don’t, it goes on the ballot. But the legislature has an option to craft a competing ballot initiative, in which case both the citizen initiative and the legislature’s initiative go on the ballot.

“So, you can almost envision special interests and utilities in the back room, wringing their hands and getting excited about drafting the legislation to go head-to-head with our legislation,” Gomberg said. And the competing legislation might promote non-renewable electricity generation like natural gas, so-called “clean coal,” or nuclear power.

“Strategically, we did not see that as our best option,” he said.

So a constitutional amendment it was.

Gomberg says that amending the state constitution is absolutely an appropriate way to promote renewable energy. It’s important to note that “state constitutions are not like the federal constitution,” said Gomberg, who is also a licensed attorney. “They’re designed to be amended and changed as things evolved.”

Indeed, Michigan’s constitution, which was written in 1963, has been amended 30 times by popular vote to do things like allow casinos or limit the state’s taxing powers, Gomberg said.

“Conservatives are yelling and hollering that the constitution is not the place for renewable energy standards, but they have used it very successfully to limit the ability to tax,” he said.

‘Not designed to be a policy document’

Steve Transeth disagrees entirely with Gomberg’s analysis. The state constitution is exactly the wrong place for a renewable energy standard, said Transeth, a lawyer and former member of the Michigan Public Service Commission who serves as an expert witness for utilities in court cases and regulatory proceedings.

“The constitution is not designed to be a policy document. It establishes rights and principles and how government functions,” Transeth argued. Moreover, Proposal 3 is “unique” among amendments to the state constitution in that it directs private companies—the state’s utilities—to engage in a specific activity, he said.

Transeth works alongside the group leading the opposition to Proposal 3, Clean Affordable Renewable Energy for Michigan (CARE). CARE is funded largely by the owners of the state’s two large investor-owned utilities. According to campaign finance disclosures filed with the state, of its $6.8 million in contributions, $3.3 million came from CMS Energy, the owner of Consumers Energy, and $3.1 million came either from DTE Energy, the parent company of Detroit Edison, or from Detroit Edison itself.

The fight about Proposal 3 “is not about whether we’re going to have a clean energy initiative and clean air,” Transeth said. “This is about making good decisions about where we’re going to go and how we’re going to get there.”

That’s not the appeal CARE makes, however, in one of its television ads against Proposal 3:

“Who’s paying for Proposal 3’s massive ad campaign?” the ad asks. “A bunch of out of state companies and California billionaires who want to hijack Michigan’s constitution—no matter how much it raises your electric bills.”

“That one mystified me,” Clift said. “I didn’t know there were billionaires involved,”

Gomberg acknowledges out-of-state environmentalists and wind promoters are helping fund the campaign. According to a July campaign finance report, the group received $1.3 million of its $2.25 million in campaign contributions from the Green Tech Action Fund, a San Francisco-based nonprofit group whose goal, according to its website, “is to spur big new markets for clean energy technologies—especially energy efficiency and renewable energy.”

Locked into wind?

Opponents also object to the measure’s specificity–wind, solar, hydroelectric and biomass are the only sources of renewable energy that will count toward the mandate. Transeth says biomass won’t be able to produce the electricity needed, the state’s hydro potential is tapped out and “solar is hugely expensive, intermittent, and unreliable.”

“Make no mistake, this is a wind proposal,” he said. “If you approve this amendment, you’re handcuffing us to a single source of energy to the exclusion of all others,” he said.

The amendment also excludes what Transeth said are other sources of “clean energy,” he said. “Nuclear power is clean energy. Clean coal technology can be clean energy. And natural gas is basically clean energy,” Transeth argues.

Of the states that have renewable energy mandates in place, “very few have not had to amend their statute several times,” Transeth said. “Why do we want to limit our options? We don’t have to do that.”

Clift dismisses that argument, saying the amendment “puts the big picture in the constitution, then allows the legislature the flexibility to implement it” by tweaking the 2008 state renewable energy law.

Under Michigan law, that can be done with a majority vote. But if the ballot initiative had created a state law, then it would require a three-quarters vote to amend it down the line. That would be less flexible than a constitutional amendment, Clift said.

Gomberg said that while procedures differ from state to state, Michigan’s effort could provide a blueprint for others seeking to bypass powerful interests in legislatures.

“You put the power of politics into the hands of the people,” he said.

Comments (3)

The Legislature could not, without going through the Constitutional amendment process, tweak the definition of renewable energy in the ballot proposal. The definition could have referred to a myriad list of things that could qualify for the 25% target (similar to the list in the 2008 renewable energy law), but it does not. It strictly defines renewable energy as only wind, solar, hydro and biomass. Energy efficiency could not count toward the 25% target. Geothermal could not count, nor could landfill gas. More importantly, new technology (that could be used to meet the 10% standard) could not be used even if it was cheaper.

By Robert Nelson on Oct 20, 2012

The definition of renewable in the statute is very sufficient, considering landfill gas is not low pollution and the geothermal electricity potential of Michigan is very small. Energy efficiency shouldn’t count toward that 25% because many efficiency options are long-term profitable to the entity which implements the improvements (i.e. not business of government to tell them how to save money; whereas renewables reduce externalities to other citizens). Efficiency also has accounting issues that do not apply to renewables. Realistically, where’s this new source of renewable energy that isn’t wind, solar, hydro, or biomass? If a breakthrough does occur it doesn’t preclude Michigan utilities from using it to satisfy the other 75% of their portfolio.

By A.S. Roth on Oct 26, 2012

I guess we will just put up with dirtier air. It’s always the greed by utility companys. And yes electricity will go up with none of the benifits of cleaner energy.! I don’t think this propoal was expained very well. Michigan will have to be dragged kicking and screaming into the arena -to catch up with more savy states! This paves the way for fracking, for the energy we will need in the future. People do not recognize the problems with this process until it effects them directly. You cna bet your booties the oil companys are planning ahead. So sad for us Karen Wrbelis Rockford Mi

By Karen Wrbelis on Nov 7, 2012