Published in Energy

MSU study forecasts economic benefits from expanded community solar development

BY Tuesday, October 19, 2021 12:15pm

EAST LANSING — Expanding community-based solar energy projects that allow utility customers to purchase subscriptions for offsite generation would contribute nearly $1.5 billion to the state’s economy and create thousands of jobs. 

That’s according to a new study from researchers at Michigan State University’s Product Center and Center for Economic Analysis that was commissioned by the Coalition for Community Solar Access, a national nonprofit advocacy group. 

Major utilities such as DTE Energy and Consumers Energy have had limited community solar development and have expressed concerns about the potential cost shifting to other customers if projects become more widespread.

The MSU study examined the potential of 900 megawatts (MW) of new community solar capacity spread out over 30 installations a year, or 180 projects at 5 MW each over the next six years. The 900 MW would represent about 3 percent of the total installed generation capacity in Michigan.

MSU researchers Steven Miller and William Knudson found that the installation and ongoing maintenance of these projects would create an estimated 18,500 jobs and contribute nearly $1.5 billion to the state’s economy over the next 30 years. That scale of development would generate nearly $318.6 million in labor income and contribute nearly $475 million in cumulative gross state product over the next three decades, according to the report.

“After analyzing the economic contributions of community solar power, it’s clear that the addition of these types of installations will significantly contribute to the state’s energy and general economy,” Miller said in a statement released by the alliance. “There’s no question that this would provide Michigan with a positive benefit according to our analysis.”

A single 5 MW community solar project directly employs about 15 people and contributes nearly $3 million annually to gross domestic product, according to the report. The study also attributes hundreds of jobs and more than $400 million in labor income to the operations and maintenance of these projects.

Meanwhile, the findings come amid a years-long effort by clean energy advocates to expand community solar in Michigan, which has faced roadblocks in the state Legislature despite bipartisan support.

House Bills 4715 and 4716 — sponsored by state Rep. Rachel Hood, D-Grand Rapids, and Rep. Michele Hoitenga, R-Manton — aim to remove policy restrictions that have stifled community solar growth in Michigan. The bills have sat in the House Energy Committee since April.

Bill supporters say most residents lack access to solar power because of financial barriers or property ownership limitations. The Michigan Community Solar Alliance formed earlier this year to back the bills, and members include the Associated Builders and Contractors of Michigan, the Citizens Utility Board of Michigan, the Michigan Energy Innovation Business Council, the Michigan Conservative Energy Forum and various environmental groups.

“Community solar is a win-win for Michigan and this important new study from researchers at Michigan State University proves it,” Jim Murray, Midwest director for the Coalition for Community Solar Access, said in a statement. “Michigan would benefit greatly from the significant jobs and economic impact that community solar would bring across our state, including rural, urban and suburban areas. We urge lawmakers to pass community solar legislation so the hardworking people of Michigan can begin to realize these substantial economic benefits.”

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