In a recent appearance before state lawmakers in Michigan, Katie Abraham, Executive Director of the Michigan Municipal Electric Association (MMEA), and Dave Koster, General Manager at Holland Board of Public Works, highlighted the wide array of benefits that public power provides to customers in the state.
MMEA is a Michigan trade association of 40 locally-owned electric utilities, while the Holland Board of Public Works is the local not-for-profit utility for Holland, Mich., and a member of MMEA.
Abraham and Koster made their remarks before the Energy Committee of the Michigan House of Representatives on Dec. 9.
In her remarks, Abraham noted the size and geographic diversity of public power utilities in the state.
“We call ourselves public power because that really captures the heart of who we are,” she told the state lawmakers. “We are owned and operated by the people in our communities, by our customers. We are non-profit entities. Our customers pay the true cost” of the service they receive.
“We believe that as a direct result of that public power model, you see significant savings in Michigan public power communities,” Abraham said.
She highlighted a report that MMEA released earlier this year that details the positive impact of public power utilities in the state. MMEA commissioned the report to measure the real, financial returns from reliability and residential rates for public power customers across the state.
MMEA contracted with Utility Financial Solutions to assist with the report.
Abraham noted that in 2023, customers of Michigan public power utilities saw an annual savings of over $400 million in one year.
“If you live in a public power community, like a Holland, for the course of your lifetime, which in this study was 75 years, you can save over $120,000, which today is significant savings – people would love to use that money on other things besides their electric bill,” she said.
Earlier this year, Abraham discussed the report in detail in an episode of APPA’s Public Power Now podcast.
Abraham also detailed mutual aid efforts by Michigan public power utilities.
For his part, Koster said that with respect to the study, there are three factors that go into that -- affordability, reliability and a connection with the community.
A community benefit analysis for 2023 done by Utility Financial Solutions found a total of $38.04 million in annual economic value provide by Holland BPW.
Koster also highlighted the utility’s Holland Energy Park, which he said has been “a really tremendous project for us and really stakeholder driven.”
The park was completed in 2017 “and we’ve already been able to pay the debt off completely, which is going to save our customers over $45 million in interest costs that they would have seen if that would have continued throughout the life of the bond,” he noted.
“We’ve also been able to improve the environmental performance of our utility tremendously by moving away from our coal generation in Holland and building Holland Energy Park and incorporating renewable technology into our portfolio as well,” Koster said.
The utility has already been able to cut the carbon intensity of its portfolio in half since 2010 “and the projections are that we’re approaching a 70 percent reduction over that number by 2030.”
Koster also discussed some of the challenges that Michigan public power utilities are facing in meeting a 2023 law related to clean energy and, in particular, renewable and clean energy mandates.
Koster provided the committee with proposed adjustments to the energy legislation to preserve flexibility and affordability, while still encouraging and supporting economic growth in municipal systems.
