In a wide-ranging interview with the Great Lakes Bulletin News Service, Michigan Governor Jennifer Granholm said that the energy efficiency and renewable energy policies she announced during her State of the State address put her state on the verge of an economic revolution.

During the videotaped session, held in her executive offices in Lansing, the governor said that the policies, which focus sharply on advancing renewable energy technology and energy efficiency measures, will help to revive the state’s badly faded manufacturing sector by focusing much of its dormant capacity on building wind turbines, solar panels, and other clean-energy devices.

“It’s all about jobs,” Governor Granholm said during the half-hour interview.

The governor predicted that her initiatives would actually create tens of thousands of jobs in Michigan.

“The state is in a very unique position to be able to lead with job creation in a green economy,” she said.

The governor also said that her initiatives would create many different kinds of “green collar” jobs. They range from assembly line work building parts for renewable energy generators; to building-trades work installing home and business weatherization, solar panels, and small wind turbines; to heavy construction work fabricating and erecting gigantic wind turbines and building a new, statewide, “smart” electrical grid.

Opponents Should Look Closer
Ms. Granholm seemed unbothered by the resistance some of her green energy policy pronouncements are attracting. That opposition, which comes from Attorney General Mike Cox, the Michigan Chamber of Commerce, the Michigan Manufacturers Association, and many Republican and some Democratic lawmakers, focuses on her order to apply stricter standards to coal-plant permitting.

Mr. Cox argued that her order was illegal, but later dropped his objection when Ms. Granholm used a different set of rules to accomplish the same thing. But business and political leaders continue to claim that, legalities aside, the order would effectively kill the thousands of industrial-scale construction jobs that building big, multi-billion-dollar coal plants would create.

Governor Granholm invited her opponents to look more closely at what she was actually proposing, and the broad effect it would have on the state’s economy.

“I want those who would be resisting this change to realize that this is a job creator,” she said. “If you change policy the right way, you create a demand for jobs in this renewable energy and energy efficiency area. Those construction workers can be put to work building wind turbines, or building the factories for wind turbines, or installing those turbines, or attaching the turbines to a smart electric grid.”

The governor said that her new energy initiatives—which clean-energy advocates say are among the nation’s most aggressive and comprehensive—have generated a strong buzz in Michigan’s renewable-energy business community. She added that the excitement is quickly spreading well beyond the state’s borders.

“Huge amounts of interest,” Ms. Granholm said, when asked what the reaction has been since announcing her plan during her Feb. 3 address to the state Legislature. “We are seeing Michigan being put on the map as a state for creating jobs in this area.”

The Fine Print
In her interview, the governor outlined some of the details of her initiatives.

She said that the state’s No Worker Left Behind program would help to train and employ laid-off workers who, as members of the Michigan Green Energy Corps, would weatherize businesses and homes across the state. The program, she said, would help workers who “really had the rug pulled out from underneath them, due mostly to the loss of automotive jobs.”

“It is used to train people in specific areas of need in our economy,” she said of No Worker Left Behind. “What we will pay for is, if you agree to be trained in an area of need…such as renewable energy and energy efficiency. We are going to have a huge need for this.”

The governor asserted that last year’s new state energy laws, which require utilities to get at least 10 percent of their power from renewable resources by 2015, is a powerful new tool for creating private-sector demand for clean energy technology and the industries to manufacture and install them.

She also explained what green-energy advocates say is the most innovative part of her program—known as “decoupling.” Ms. Granholm said it means that the Michigan Public Service Commission will dramatically reshape how utilities charge their customers for power in Michigan.

Under the current rate structure, the more energy a consumer uses, the more money a utility makes. But under the new regimen, she explained, utilities will instead have strong financial incentives to help their customers use less, not more, electricity. She pointed to a similar measure implemented throughout California that she said is hugely successful: Over the past 30 years, it has kept per capita energy demand there flat.

“The more we have the lights on, the more the utilities make, so there is no incentive for the utility company to have us use less energy,” the governor said. With decoupling, she said, “We flip the incentives.”

The governor also talked about the initiative that she said would spark a homegrown renewable-energy industry in Michigan. The initiative, which requires legislative action, would make it easy for residents to install their own solar panels or small wind turbines and sell the power they generate to the grid at a profit.

“If you are willing to allow the installation of solar panels on your roof and small wind systems in your back yard, we’ll connect that to the electric grid,” she explained. “You may not have a lot of money up front to do this. Well, we want to absorb some of that upfront cost for you, have you install it, and benefit from that renewable energy.”

She added that she hopes to use federal stimulus dollars to provide financial incentives for the homegrown energy systems.

Cutting Carbon Means Cutting Coal
Perhaps the most controversial aspect of Governor Granholm’s plan is her commitment to reduce Michigan’s use of CO2-producing fuels to generate electricity by 45 percent by 2020.

Global-warming deniers would question that goal, which is meant to slow climate change. But a number of state leaders have rejected its nearly automatic consequence—reducing reliance on CO2-rich coal burning for generating energy—on different grounds.

Currently, as many as eight energy companies want to build new coal plants in Michigan. But the governor ordered the Michigan Department of Environmental Quality to re-examine the five currently pending plant permit applications to see if there is a real need for more electricity and whether building new coal plants to generate that new power is the most “prudent and feasible” alternative.

The governor pointed out that “the recession…has diminished enormously the demand for power. Certainly coal fired power plants are seeing that.”

When her energy efficiency measures are implemented, she asserted, that demand would drop even further. She added that the arrival of the Obama administration has also changed the coal equation.

“Now we have an administration in Washington that is set, we believe, to issue some rules in respect to CO2,” she said. “That, I believe, is going to have an impact on what utilities do with respect to coal.”

A Green Lifeline
Ms. Granholm said that most of her energy initiatives can be accomplished via the Michigan Public Service Commission, but that the Legislature will likely have to pass new laws to facilitate the for-profit homegrown green energy installations, a policy that is known in some other countries as “feed-in tariffs.”

She also said that, despite public criticism from Attorney General Cox and others, she believes that the vast majority of business leaders, citizens, and government leaders understand that clean energy is at the center of Michigan’s economic recovery.

“The business community that is engaged in energy efficiency and renewable energy, they are all excited,” the governor said.

“For example, the auto suppliers have felt such a contraction in the auto industry, and we’ve held a number of seminars on how to diversify and how to provide products for wind turbine manufacturing. They are all about it, because they see it as a lifeline.”

The governor encouraged the state’s citizens to do everything they can to weatherize their homes and reduce energy consumption. They should also explore the feasibility of implementing their own homegrown renewable energy systems, and should call their legislators and demand action on policies that promote such green energy efforts, particularly feed-in tariffs.

“Any time you can connect with a legislator and tell them about the importance of Michigan creating jobs in this renewable energy area, it is so important,” according to the governor. “In a democracy, it’s the best thing we’ve got going.”

Veteran investigative journalist Glenn Puit is a policy specialist with the Michigan Land Use Institute. Reach him at glenn@mlui.org.