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Sustainable Energy Utility

Ann Arbor is moving toward a bold green-energy plan that's never been tried before

by Michael Betzold

From the December, 2021 issue

When world leaders met in Glasgow in early November to grapple with the accelerating climate crisis, there was lots of talk about the urgent need for action. Ann Arbor committed to action two years earlier. In November 2019, city council called for "a just transition to community-wide carbon neutrality by the year 2030."

The city formally launched "'A2NetZero" the following year. Now it's considering creating its own "sustainable energy utility" (SEU) to generate and distribute clean energy.

Developed over the past nine months by the city's office of sustainability and innovations (OSI), the plan was introduced at a public meeting in late October and in presentations to city council and the energy commission in November. It would create a 'publicly owned municipal utility that would start out by building "microgrids" to let residents and businesses share energy from new solar panels and geothermal sources. Eventually, they would all be tied together in a citywide system.

OSI manager Missy Stults won't take sole credit for the proposed revolution in local energy production and distribution. "I just collected bread crumbs" from two presentations at an energy commission meeting last March, she says. The SEU plan took shape during subsequent conversations with tech and labor consultants.

Those talks resulted in a thorough report that's now available online (tinyurl.com/AnnArborSEU). As the document notes, "It's not your parents--or your grandparents--kind of utility." Instead of a few giant power plants, it would finance and install many rooftop solar panels on local homes and businesses, store the energy collected from them in batteries, and run wires to neighbors. Later, it could also share geothermal energy from underground pipes. SEU customers could choose to retain DTE as a backup, at least through 2030.

Building Ann Arbor's own utility while staying connected to DTE at least for a while would avoid two major problems, Stults says. The utility's infrastructure is old, vulnerable, and in need of major and expensive upgrades; local generation and

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storage should be more resilient if the utility's grid goes down. And by not trying to force DTE to sell its poles and wires, the city hopes to avoid the prolonged and expensive litigation that greatly complicated "municipalization" efforts in Winter Park, Florida, and Boulder, Colorado.

"We want to work collaboratively with [DTE]," Stults says. If the city falls short of its 2030 goal, she says, the city could buy additional "green" energy from the private company or other sources.

Stults's team is now working to estimate how much it would cost to create an SEU, and what rates it might charge. The next formal step would be for the city to adopt an SEU ordinance; Stults guesses this might happen as early as the second quarter of 2022.

The biggest challenge will be finding the money to build a new generation and distribution system. An environmental millage Mayor Taylor is bringing forward next spring could help with that. Other possible avenues include borrowing, which would require a public vote on a bond; grant funding; or some kind of public-private partnership.

If all goes as planned, the first step would be launching microgrids in an area where there is strong interest. That's likely to be the low-income Bryant neighborhood, because OSI has already been working with residents there on energy issues. Another proving ground could be the proposed Veridian development at County Farm Park.

Chelsea and other Michigan cities have municipal utilities, and Delaware and Washington, DC, have SEUs that help individuals pay for clean energy upgrades. But Ann Arbor's is envisioned to do much more.

If it works, it could spur other cities to launch similarly ambitious climate mitigation efforts.     (end of article)

[Originally published in December, 2021.]

 


 
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