$129M From IRA Boosts Michigan’s Wind, Solar Plans
According to an announcement made by the state and federal governments in July, Michigan is set to receive a significant financial boost to aid in the expansion of large wind and solar projects. Specifically, $129 million in federal funds has been designated to streamline the processes involved in siting, zoning, and permitting large-scale renewable energy installations. This initiative aligns with the state’s goal to rapidly decarbonize its electric grid over the next decade. The funding, part of a $4.3 billion allocation being distributed across the United States, is sourced from the 2022 federal Inflation Reduction Act’s Climate Pollution Reduction Grant program. SBN Detroit interviewed Joel Howrani Heeres, director of community resilience at Public Sector Consultants, who also was Detroit’s first sustainability director, for his thoughts regarding how the money should and will be spent, potential challenges, geographical impact, and other topics. Q: Michigan recently received $129 million in federal funding to advance large wind and solar projects. How do you see it being allocated and what are the biggest priorities to address in terms of large wind and solar? A: I think that the state is rightfully deploying this money to help incentivize local governments to permit solar and wind projects within their boundaries. We have a very aggressive goal to achieve as a state – 60% renewable energy by 2030. The funds provide a significant incentive for communities to host renewable energy infrastructure, offering up to $5,000 per megawatt. Rural areas often lack the resources and personnel needed to review permits and manage other aspects of developing this infrastructure. This financial support will be instrumental in helping these communities navigate the complexities involved in such projects. Q: The funding comes from the Federal Climate Pollution Reduction Grants (CPRG) program, created by the Inflation Reduction Act. Can you tell us more about this and its specific influence in Michigan? A: The CPRG is one of the first grant programs to enable both planning and implementation to address climate change. There is funding allocated for metropolitan areas above a certain size. To me, this regional approach makes a lot of sense. Emissions don’t stop at city boundaries. For example, there are many heavy industries on the Detroit/Melvindale border that impact that whole area and beyond. Taking a regional approach and also statewide grants have been used to help EGLE do their planning as well. I was disappointed to see that Michigan’s metro areas did not get implementation money from this grant, but accelerating renewables throughout the state is important. Q: What are the challenges that come with such large-scale complex projects in Michigan? A: First, local permitting and project development. The amount of land required for renewable energy installations presents another challenge, especially in rural areas where agricultural land is at a premium. Convincing these communities to accept large renewable installations, particularly when the power generated is likely to be consumed elsewhere, can be difficult. Discussing the benefits and costs of hosting these installations has become a political issue. Communities want to see tangible benefits and are reluctant to give up their land without adequate compensation. Thus, providing financial incentives to these communities could be an effective approach. Another important consideration is determining, from a grid perspective, the most strategic locations to connect these large installations to ensure efficient power transmission. Q: Is there a long runway with projects like this from an execution and timeline standpoint? A: Yes, there is. The process from conceptualization to actual ground-breaking involves numerous steps. This includes navigating the political landscape, such as public hearings and potential opposition. Additionally, there are essential stages like securing permits and installing infrastructure. Each of these components requires considerable time and careful planning. Q: Is there a geographical component? What areas of Michigan will be most impacted? A: Rural areas will be impacted the most. Beyond that, I don’t think there will be geographic concentration, I think it will spread across the state. Q: Do you foresee local opposition from Michiganders regarding these projects, and, if so, what are your thoughts on how to address this? A: Yes. Just the other day I was driving through Washtenaw County and saw signs that read “No Industrial Solar.” The focus returns to the tangible benefits of these installations. It is essential for people to see clear advantages. For instance, if a local government receives $5,000 per megawatt to enhance local services — funds that would not have been available otherwise — it can help alleviate some of the opposition to these projects. This financial support can be directed toward improving community services, thereby showcasing the positive community benefits of the installations. Q: Federal money will also flow to workforce development programs. What are your thoughts on how these projects may boost the economy and put people in jobs? A: It’s a crucial aspect of our current situation. We are undergoing a significant energy transition, shifting from fossil fuels to renewable energy sources, which represents a fundamentally different model. This transition requires Michiganders to acquire new skills to compete in the emerging green economy. Additionally, we’re moving toward the electrification of everything. By producing clean energy, we can electrify our homes, cars, and various aspects of our lives, as it all comes from a sustainable source. There is a critical need to retrain workers from the fossil fuel sector to participate in the electrified economy. Significant investments are being made in this area. Ultimately, this is a comprehensive ecosystem, and these changes will impact labor across all sectors. Q: What other ancillary benefits can we expect to accompany the execution of these projects? A: As we transition more of the energy load to cleaner technology, we’ll have less localized pollution, leading to statewide public health benefits. Additionally, there’s a significant potential for economic development. Michigan stands out as one of the most proactive states in terms of climate ambitions, which could attract industries seeking to operate on green power. Whether it’s tech companies, manufacturing firms, or other businesses, the state’s commitment to sustainability
The Inflation Reduction Act – How Small and Medium-Sized Businesses Can Benefit
The Inflation Reduction Act of 2022 includes $500 billion in new spending and tax breaks targeted toward climate change, clean energy, training, and workforce development, the development of clean infrastructure, and more. It puts the U.S. on a path to 40% emissions reduction by 2030 with these desired impacts: Lower energy costs Increased energy security Investments in decarbonizing all sectors Focused investments in disadvantaged communities Support for resilient rural communities Additionally, the legislation act offers businesses and entrepreneurs unprecedented opportunities but identifying these opportunities and navigating how to capitalize on them can be daunting. To help small- and medium-sized businesses understand the act, SBN Detroit held a virtual event on May 18 featuring Joel Howrani Heeres, director, Public Sector Consultants; Jerry Davis, professor, Ross School of Business; Dan Radomski, executive director, Centrepolis Accelerator at Lawrence Tech University, and Kimberly Hill Knott, president and CEO, Future Insight Consulting. Each speaker presented according to their areas of expertise, followed by a Q & A. We’ve shared some of the speakers’ points below. You can view the full event here. A significant portion of IRA rebates goes to homeowners, creating an opportunity for contractors to provide energy audits, electrification upgrades, and more. The funds allow for roughly 5,000 houses to take advantage of rebates. – Howrani There are five components involved in creating an enterprise – capital, labor, organization, supply, and distribution. The IRA creates opportunities within each of these components. – Davis When it comes to cleantech funding, it’s important to understand what stage of development you are in and how that applies to different funding opportunities. Generally, funding comes in when technologies are mature and ready for deployment. But there are different opportunities within the different stages. – Radomski As we transition to the Infrastructure Investment and Jobs Act (IIJA) there will be more investments in infrastructure, and the money will flow through state agencies and departments. – Radomski The key to being e successful with IRA funding is collaboration. Addressing climate change is multifaceted. For example, residential electrification dollars are coming. but many houses are not necessarily ready to replace fossil fuel sources with electricity. So, there is an opportunity to partner with community action agencies that manage funds for home repair to get homeowners ready. For example, the community action agency essentially does intake and prep, and a private contractor does the electrification work to use the rebates. – Howrani There are new opportunities up and down the supply chain from technicians to engineers to manufacturing. This is going to take an effort in workforce development by universities, community colleges, and manufacturers themselves. We need education in all of these areas which will lead to jobs and wealth creation. – Radomski My students surveyed local small businesses regarding their priorities around green energy. The overwhelming response was reliability. For these businesses, extended power outages could be catastrophic. This presents an opportunity – how do we solve this? – Davis Understanding that the IRA is not easily interpreted, I had my students translate parts of it into easy-to-understand How to Guides and also sample business models which can be found at Greenbiztransition.com View the full presentation and Q&A here. Be sure to subscribe to our newsletter for regular updates on sustainable business practices in and around Detroit.
