Energy Storage Target

Summary

With the enactment of Public Act 235, Michigan adopted an energy storage target of 2,500 MW by December 31, 2029.

Electric providers are responsible for a share of this target based on their proportional share of annual average in-state peak load, calculated over five years. Electric providers are to demonstrate compliance with the target in their integrated resource plans. Alternative electric suppliers can contract with electric utilities to supply their share of the target. 

Electric providers that contract with third-party providers for energy storage are eligible for a financial incentive. The incentive is the product of contract payments in that year multiplied by the electric provider’s pre-tax weighted average cost of permanent capital comprised of long-term debt obligations and equity of the electric provider’s total capital structure as determined by the Michigan Public Service Commission’s final order in the electric provider’s most recent general rate case.

A proceeding implementing the energy storage requirement is underway in Docket No. U-21571.