Renewable Energy Technology Incentives in Michigan | The Renewable Energy Hub USA

Renewable Energy Technology Incentives in Michigan


Like many states in the North East, Michigan has forged ahead with green energy initiatives and has a number of incentives in place to promote renewable technology. With large supplies of natural gas and three nuclear power plants, the state is planning to operate an inclusive mix of energy sources including green ones. 35% of their renewable energy comes from biomass for which it has great natural resources, though areas such as solar too have been growing in recent years.

This year Michigan’s first solar farm is supposed to go online producing 1.4 MW and two larger installations were begun in 2015 in Lapeer County. A number of community projects such as the 3MW array at Grand Valley State University are expected to be completed later in 2016. Wind power provides 2.4% of the electricity in Michigan with 883 wind turbines providing a capacity of 1,524 MW and the biggest is the Beebe Wind Farm with a generating capacity of 81.6 MW. The state also has a number of hydroelectric dams which contribute a small amount to the energy mix.

Michigan has 9 main biomass power plants which together supply over a third of the renewable energy in the state. The largest is Cadillac Renewable with a capacity for 38 MW. Most of the biomass plants are fed from local sources making them very energy efficient and promoting jobs in the local community.

Solar PV Incentives in Michigan

While there are few major solar farms so far in the state, the industry is beginning to thrive with over 200 companies employing 2,800 staff. A number of major companies such as Ford and Ikea have gone solar in recent years and there are incentives to install roof top arrays through the Federal Tax Rebate. There is also the state Solar Currents Program that provides a residential rebate of $0.20 per watt installed and net metering is also in operation. The state has the Experimental Advanced Renewable Program in place for large family residential, businesses and government and school installations.

Solar PV Case Study in Michigan

In Michigan you have the choice of buying your array outright and keeping all the profits or leasing it, whereby you hand over the federal and state incentives for free installation but benefit from cheaper electricity bills. A 5 kW array will cost in the region of $20,000 and with the Federal Tax Rebate and other incentives you could see a return on investment in about 14 years. With a standard life time of 25 years for the array, you can expect to make a profit in the region of $7,300. That doesn’t take into account the increased sale value of your home.

Solar Thermal Incentives in Michigan

Solar hot water systems come with many of the incentives of solar PV and can greatly reduce the costs of heating in many homes and businesses. Various grants and low cost loan schemes are also available such as the Michigan Saves Business Energy Financing project which is aimed at commercial and nonprofit organizations.

Small Hydro Incentives in Michigan

Hydroelectric production is fairly small in Michigan with a number of community and utility run facilities. Micro hydro installations do have potential particularly for agricultural and remote areas of the state and benefit from the Federal Tax Rebate. One specific incentive is the local City of Ann Arbor Green Power Purchasing scheme.

Geothermal Incentives in Michigan

As with many other states there are incentives in place for installations such as ground source heat pumps. These include the Federal Tax Rebate and loan and grant schemes such as the Property Assessed Clean Energy scheme for commercial and industrial concerns. The Commercial and Industrial Energy Efficiency Program rebate is also available.

Biomass Incentives in Michigan

Wood burning biomass is on the increase in Michigan with a number of power plants providing energy for the local community. There are also incentives for agricultural premises to invest in anaerobic digestion and there are various projects currently under development. The Consumers Energy Experimental Advanced Renewable Program is aimed at AD and provides feed in tariffs for the amount of energy produced. There are also tax breaks for both biomass and AD including the Biomass Gasification and Methane Digester Property Tax Exemption.

Wind Power Incentives in Michigan

Wind power in Michigan has great potential because of the state’s location and there are a number of incentives including the Federal Tax Rebate. Installers can also access grants and loans such as PACE financing in certain regions and the Michigan Accelerating Technologies (MATch) Energy Grant. Despite the high cost of installing wind turbines, the return on investment is still quite good particularly though location and wind speed generally determine this more than incentives.

Michigan has a growing portfolio of renewable energy initiatives both locally and state wide which means that it is moving forward with the green agenda. There is still some way to go though and much will depend on how the state develops its solar and wind sectors to complement its current biomass production.

You can discover more about the renewable energy technology incentives for both commercial and residential installations in Michigan on the DSIRE website

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