Michigan has strong opportunities to develop wind, biomass and solar power, which provide environmental benefits, improved reliability, and economic development in the growing renewable energy business sector. Furthermore, Michigan can develop new efficient generation, such as CHP, using natural gas. Together, the opportunities shown in Figure 3 could supply nine percent of Michigan's generation capacity by 2010, and 29 percent by 2020.

The Clean Energy Development Plan can be realized at a modest cost, as energy efficiency savings offset the cost of new generation. In Michigan, it would increase overall electricity costs by about 1.5 percent in 2010, and 3.4 percent in 2020.

Smart policies can overcome the many market and regulatory barriers that energy efficiency and renewable resources face. The most important policy actions for achieving the Clean Energy Development Plan in Michigan are to:

1. Establish an Energy Efficiency Investment Fund to support energy efficiency initiatives with a non-bypassable charge of 0.3¢/kWh.
2. Manage the Energy Efficiency Investment Fund by an independent third-party administrator overseen by a board composed of regulators, state energy offices, and consumer, efficiency and environmental advocates.
3. Evaluate and update Michigan's efficiency standards and building codes. Establish or reinforce monitoring and enforcement practices.
4. Establish a Michigan Renewables Portfolio Standard requiring all retail electricity sellers to provide eight percent of their electricity from renewable resources by 2010, and 20 percent by 2020.
5. Establish a Renewable Energy Investment Fund to support emerging renewable technologies, with a non-bypassable charge of at least 0.1¢/kWh.
6. Ensure that transmission pricing policies and power pooling practices treat renewable resources fairly and account for their intermittent nature, remote locations, or smaller scale.
7. Remove barriers to clean distributed generation by: (1) applying net metering policies to all wind and photovoltaics; (2) establishing standard business and interconnection terms; (3) establishing uniform safety and power quality standards to facilitate safe and economic interconnection to the electricity system; and (4) applying clean air standards to small distributed generation sources, thereby promoting clean power technologies, and discouraging highly polluting diesel generators.