Michigan Laws 460.1075 – Energy waste reduction plan; exceeding standard; authorization for commensurate financial incentive; payment; limitations
Current as of: 2023 | Check for updates
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Terms Used In Michigan Laws 460.1075
- Commission: means the Michigan public service commission. See Michigan Laws 460.1003
- Electric provider: means any of the following:
(i) Any person or entity that is regulated by the commission for the purpose of selling electricity to retail customers in this state. See Michigan Laws 460.1005Energy waste reduction plan: means a plan under section 71. See Michigan Laws 460.1005 Energy waste reduction standard: means the minimum energy savings required to be achieved under section 77 or 78(1), as applicable. See Michigan Laws 460.1005 Natural gas provider: means an investor-owned business engaged in the sale and distribution at retail of natural gas within this state whose rates are regulated by the commission. See Michigan Laws 460.1009 plan: means a plan approved under section 22 or former section 21 or 23 or found to comply with this act under former section 25, with any amendments adopted under this act. See Michigan Laws 460.1011 Provider: means an electric provider or a natural gas provider. See Michigan Laws 460.1009
(1) An energy waste reduction plan of a provider whose rates are regulated by the commission may authorize a commensurate financial incentive for the provider for exceeding the energy waste reduction standard. Payment of any financial incentive authorized in the energy waste reduction plan is subject to the approval of the commission.
(2) The total amount of a financial incentive for an electric provider that achieves annual incremental savings of greater than 1.5% of its total annual retail electricity sales in megawatt hours in the preceding year or a natural gas provider that achieves annual incremental savings of greater than 1% of its total annual retail natural gas sales in decatherms in the preceding year shall not exceed the lesser of the following amounts:
(a) 30% of the net present value of life-cycle cost reductions experienced by the provider’s customers as a result of implementation, during the year for which the financial incentive is paid, of the energy waste reduction plan.
(b) 20% of the provider’s actual energy waste reduction program expenditures for the year.
(3) The total amount of the financial incentive for an electric provider that achieves annual incremental savings of greater than 1.25% but not greater than 1.5% of its total annual retail electricity sales in megawatt hours in the preceding year or a natural gas provider that achieves annual incremental savings of greater than 0.875% but not greater than 1% of its total annual retail natural gas sales in decatherms in the preceding year shall not exceed the lesser of the following amounts:
(a) 27.5% of the net present value of life-cycle cost reductions experienced by the provider’s customers as a result of implementation, during the year for which the financial incentive is paid, of the energy waste reduction plan.
(b) 17.5% of the provider’s actual energy waste reduction program expenditures for the year.
(4) The total amount of a financial incentive for an electric provider that achieves annual incremental savings of at least 1.0% but not greater than 1.25% of its total annual retail electricity sales in megawatt hours in the preceding year or a natural gas provider that achieves annual incremental savings of at least 0.75% but not greater than 0.875% of its total annual retail natural gas sales in decatherms in the preceding year shall not exceed the lesser of the following amounts:
(a) 25% of the net present value of life-cycle cost reductions experienced by the provider’s customers as a result of implementation, during the year for which the financial incentive is paid, of the energy waste reduction plan.
(b) 15% of the provider’s actual energy waste reduction program expenditures for the year.