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Sun Is Shining on Michigan’s Solar Industry

Blog Archive | October 22, 2010 | By Glenn Puit

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Midland-based Dow Chemical Company Corporation is hiring workers to produce its new, flexible, Powerhouse solar shingle for a mid-2011 launch.

Here’s some good news regarding ongoing efforts by the Granholm administration to build a clean energy economy in Michigan.

The Solar Foundation, a Washington D.C.-based non-profit, reports that Michigan is now fourth in the nation for job creation in the solar industry. Michigan, according to the foundation, has approximately 6,300 people employed in the industry, the majority working at solar manufacturing firms like United Solar and Hemlock Semiconductor Corporation.

Texas, Pennsylvania, and California were the only states to rank higher than the Wolverine State.

“It’s not by accident that this is happening,” said John Sarver, a manager in the Energy Bureau of Michigan’s Department of Energy, Labor & Economic Growth, who credits state leadership for the job creation.

But while Michigan is making strides in creating solar manufacturing jobs, it still has a long way to go in helping entrepreneurs get into the homegrown renewable energy business. And a study by the American Council for an Energy-Efficient Economy shows that Michigan has a great deal of work to do on energy efficiency, as well: ACEEE’s study ranked Michigan 27th overall in conserving energy.

That is because legislation that would establish feed-in tariffs and raise efficiency mandates for electric utilities continues to languish in the state Legislature.

Regarding the solar industry jobs, Mr. Sarver told the Institute that the Michigan Economic Development Corporation’s targeting of the clean energy sector for job growth has made a big difference. Tax incentives and green energy renaissance zones, in particular, are helping existing Michigan manufacturers expand into producing components for renewable generation.

For example, in February, Dow Chemical Company announced expansions in its wind, solar, and advanced-battery manufacturing reflecting more than $1 billion in new investments-including the ramp-up of production of its new, solar-voltaic Powerhouse shingle. Dow said that, over the long haul, those investments would create more than 6,900 new jobs in the clean energy sector.

“We are making good progress in alternative energy on a number of different fronts—wind and solar and biomass,” Mr. Sarver said. “One thing that’s been really good to see, too, is that, while a lot of states are emphasizing bringing in companies from other states and overseas, I think MEDC has really worked with existing [Michigan] companies to diversify and expand operations.”

Other highlights from The Solar Foundation report:

  • The U.S. solar industry employs 93,000 workers. In the next year, more than half of solar firms expect to add jobs. Meanwhile, the projected 12-month growth rate for the U.S. economy is just 2 percent.
  • 52 percent of solar workers are in the West. The Upper Midwest represents just 8.9 percent of the solar workforce.
  • The biggest projected growth area for solar employment in the next year is in solar panel installation.

Not everything is sunny in Michigan, however.

While the state is starting to excel in creating solar manufacturing jobs, many experts feel Michigan has not done nearly enough in allowing homeowners and businesses to become their own green energy producers. Proposals forfeed-in tariffs—which allow green energy producers to sell their excess energy back to the grid at a profit—are considered the best option for furthering localized green energy production, but enabling legislation has been stalled in Lansing for about three years.

Another area where the state has a lot of work to do is on energy efficiency. Dr. Martin Kushler, director of the utilities program for the American Council for an Energy Efficient Economy, said Michigan’s ranking of 27th nationally in conserving energy is a slight improvement over the state’s ranking of 34th the year prior, but Dr. Kushler said Michigan can do better.

Mr. Kushler does commend the state for its breakthrough 2008 legislation mandating that Michigan utilities implement energy efficiency programs for their customers.

“Prior to that, we had no requirement, and we were doing nothing,” he said.

But Mr. Kushler said the state now needs to ramp up the amount of energy utilities are required to save annually. By 2012, he said, utilities will be required to save 1 percent annually, and he suggests that amount should be doubled to 2 percent every year. He also believes the Legislature should remove an existing financial cap on how much utilities can spend on energy efficiency programs.

“It’s a very crucial issue in Michigan, given our dollar drain on energy costs,” he said.

Glenn Puit is a policy specialist for the Michigan Land Use Institute. Reach him at glenn@mlui.org.

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