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Business Review Western MI
Business Review Western MI
Empowering alternative energy
(wgvu) - Empowering alternative energy

Lansing considers Renewable Portfolio Standard

March 20, 2008

By B. Candace Beeke

With recent arguments between the governor and attorney general played
out in the media, it seems renewable and alternative energy already is
generating a lot of wind.

Gov. Jennifer Granholm has spent months campaigning to change state
policy to further the emerging industry that she says would generate
thousands of jobs for the state. Meanwhile, Attorney General Michael Cox
argues it will hike electric rates and bring minimal employment gain.

But momentum is growing, with numerous alternative energy events
happening across Michigan and multiple bills moving through the state
Legislature aimed at incentivizing this diverse industry.

With its entrepreneurial and manufacturing legacy, western Michigan
businesses have led the chorus, some say, pushing for policy changes to
jump start alternative energy.

That was the message at Grand Valley State University's Alternative
and Renewable Energy Summit March 11. One by one, they came forward from
across the state business people who believe their future, and
perhaps that of the entire state, lies in alternative energy.

Fred Keller, chairman and CEO of Cascade Engineering Inc. in Grand
Rapids, called for the state to adopt a Renewable Portfolio Standard and
the federal government to make permanent the Production Tax Credit,
which expires the end of 2008.

Those two things really are the main drivers, Keller said at the
GVSU summit. The idea of having some sort of policy makes sense for
us in this country, for us in this state . It has big implications for

An RPS, which 24 states enacted, mandates certain percentages of power
sold in a state to be generated from systems using sustainable renewable
sources of fuel. At time of publication, Michigan's House and Senate
committees were examining several bills relating to RPS, some tied to
elimination of electric choice. (See the related story on energy on page

It would definitely increase our ability to attract foreign
investment in Michigan if we had an RPS, Keller said, focusing on the
opportunities for manufacturers to supply any of the 8,000-some
components that comprise a wind turbine.

But the field includes at least four distinct segments, all of which
represent opportunity for manufacturers, said Jim Croce, CEO of
NextEnergy in Detroit biomass, solar thermal and photovoltaic,
advanced batteries, and wind turbines. (See related story on alternative
energy manufacturers below.)

They're all growing rapidly, said Croce, whose not-for-profit
was created by the Michigan Economic Development Corp. in 2002 to
accelerate alternative manufacturing.

I believe more so than anyplace, this region gets it.

Wind could be Michigan's leading contender in alternative energy,
with 23 percent growth in 2007 in the global market, which accounted for
$23 billion in 2006, Croce said.

This whole industry is expected to double by 2010 over 2006
levels, he said. U.S. is the fastest-growing market. Wind OEMs
can't find parts to build turbines.

There are about 2,000 manufacturers that could participate in this
industry in Michigan.

In a Detroit Economic Growth Corp. November 2006 analysis, Kent County
led the state in job potential for alternative energy, with 3,575
potential new positions, Croce said.

But 60 percent of the new 2006 wind projects went to Texas, Washington,
California, New York and Minnesota all with an RPS.

Eighty percent of the battle here is policy, not technology,
Croce said.

Even if Michigan captured only one percent of wind business worldwide,
it would bring $800 million in new business and 4,250 new jobs, said
Greg Northrup, executive director of West Michigan Strategic Alliance,
which co-sponsored an Alternative and Renewable Energy Cluster analysis
in December 2007.

We're already behind in the race, Northrup said.
Twenty-four states already have an RPS. We need to catch up. We
already have the resources to make a cluster work.

An RPS would boost Granger Electric's methane capture from landfill
gases, as well, said Marc Pauley, director of electric operations and
development for the Lansing company a sibling to Granger
Construction in Grand Rapids.

Pauley has worked for two years with Lansing, advocating for a mandate
of 10 percent alternative energy purchase.

Our hope is we get something in place, Pauley said.

Grand Rapids Mayor George Heartwell also petitioned for an RPS, saying
he spoke to a Spanish wind turbine maker that said it would not come to
a state without that legislation in place.

He also said he believes a mandate, likely for 10 percent by 2015, will
pass this quarter.

Perhaps with a second tier of 15 percent by 2020 or 20 percent by
2020, Heartwell said.

It needs a lot of support by the business sector. There are others
whispering in their ears saying it's going to be very expensive in the
state, saying it's going to hurt the utilities.
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