A three-billion-watt (3-GW) reserve power shortfall due to the elimination of “ancient”, high-emitting coal plants serving Michigan’s Lower Peninsula could “present opportunities for the state to restructure its energy system to encourage demand-side solutions, driving down the need for new generation,” Midwest Energy News reports.
In fact, building new power plants to make up for the lost capacity “could actually put Michigan in an even worse position in the future,” Balaskovitz writes.
“Going out and overbuilding new fossil fuel plants could ultimately end up with stranded assets,” said Dan Scripps, President of the Michigan Energy Innovation Business Council. “Demand response, behavioural energy efficiency, and distributed generation can have a pretty dramatic effect on peak loads.
“It’s something ratepayers and policymakers should be concerned about: How do you get that balance right?”
The power shortfall will occur by next year, but “it’s not as if the state will leave 3 GW worth of customers in the dark in 2016 unless there is generation to replace it,” Balaskovitz stresses. But the state will face a gap in the reserve power utilities are expected to maintain beyond normal peak electricity demand.