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More than a year after 5 Lakes Energy released a report detailing more than $7.8 billion in federal investments available to fuel Michigan’s transition to clean energy, the consulting firm is taking stock of the state’s energy economy following the passage of multiple laws based on Gov. Gretchen Whitmer’s climate plan.
In November, the Democratic-led Michigan Legislature voted through a host of policies including goals for transitioning the state to 100% clean energy by 2040 and increasing the state’s energy waster reduction standards and efforts intended to streamline the permitting process by allowing the Michigan Public Service Commission (MPSC) to approve large scale renewable energy projects provided they meet state requirements.
“The future of our energy sector — and a significant part of our economy — lies in clean energy. This report highlights how investments in clean energy fuels robust job growth across the U.S. energy sector, with Michigan playing a key role,” state Sen. Sue Shink (D-Northfield Twp.) said in a statement.
“Our historic Clean Energy Future legislation has positioned Michigan as a national leader in the fight against climate change, reducing household utility cost and safeguarding our air, water and public health, while creating good-paying jobs for people. This report proves that prioritizing clean energy isn’t just good for the environment — it’s also a powerful boost for our economy and American workers,” said Shink, who was a lead sponsor of one of the bills in the clean energy package.
By examining the interactions between the Inflation Reduction Act and Michigan’s suite of clean energy legislation, the report estimates Michigan families will save an average of $297 a year on their energy bill by 2030 and $713 a year by 2040 compared to if these policies were not enacted, saving Michiganders more than was predicted in the previous report.
Additionally, Michigan will bring in $15.6 billion in investments from the Inflation Reduction Act by 2030 and $30.7 billion by 2040. The state will also shrink its greenhouse gas emissions by at least 65% over the next six years, down 88% by 2040.
Michigan is also projected to save $7.3 billion by 2030 in avoided public health costs — such as deaths, hospitalizations and lost school and work days — with savings across the state totaling $27.8 billion by 2040.
The report also broke down the economic impact of these policies on a more local level, breaking the state into 10 regions and examining the projected growth of jobs and the gross domestic product of those regions.
Region 1: Upper Peninsula
- The report projects 1,462 new jobs annually by 2030 and 2,510 by 2040
- It also projects a $187,859,771 annual increase in GDP each year by 2030 and $356,761,950 by 2040
Region 2: Northwest Michigan, including Antrim, Benzie, Charlevoix, Emmet, Grand Traverse, Kalkaska, Leelanau, Manistee, Missaukee and Wexford counties
- The report projects 1,909 new jobs annually by 2030 and 3,386 by 2040.
- It also projects a $246,569,065 annual increase in GDP each year by 2030 and $470,690,538 by 2040.
Region 3: Northeast Michigan including Alcona, Alpena, Arenac, Cheboygan, Crawford, Iosco, Montmorency, Ogemaw, Oscoda, Otsego, Presque Isle and Roscommon counties
- The report projects 959 new jobs annually by 2030 and 1,748 by 2040.
- It also projects a $127,802,450 annual increase in GDP each year by 2030 and $254,851,302 by 2040.
Region 4: West Michigan including Allegan, Barry, Ionia, Kent, Lake, Mason, Mecosta, Montcalm, Muskegon, Newaygo, Oceana, Osceola and Ottawa counties
- The report projects 10,602 new jobs annually by 2030 and 17,090 by 2040.
- It also projects a $1,409,423,991 annual increase in GDP each year by 2030 and $2,391,054,542 by 2040.
Region 5: East Central Michigan including Arenac, Bay, Clare, Gladwin, Gratiot, Isabella, Midland and Saginaw counties
- The report projects 2,732 new jobs annually by 2030 and 4,956 by 2040.
- It also projects a $364,684,806 annual increase in GDP each year by 2030 and $736,094,240 by 2040.
Region 6: East Michigan including Genesee, Huron, Lapeer, St. Clair, Sanilac and Tuscola counties
- The report projects 3,608 new jobs annually by 2030 and 4,003 by 2040.
- It also projects a $468,432,470 annual increase in GDP each year by 2030 and $905,568,594 by 2040.
Region 7: South Central Michigan including Clinton, Eaton, Hillsdale, Ingham, Jackson and Livingston counties
- The report projects 2,481 new jobs annually by 2030 and 4,003 by 2040.
- It also projects a $296,793,115 annual increase in GDP each year by 2030 and $509,513,179 by 2040.
Region 8: Southwest Michigan including Berrien, Branch, Calhoun, Cass, Kalamazoo, St. Joseph and Van Buren counties
- The report projects 4,316 new jobs annually by 2030 and 7,294 by 2040.
- It also projects a $591,682,572 annual increase in GDP each year by 2030 and $1,104,041,476 by 2040.
Region 9: Southeast Michigan including Monroe and Washtenaw counties, as well as the non-Detroit portions of Wayne County
- The report projects 5,060 new jobs annually by 2030 and 8,383 by 2040.
- It also projects a $632,005,149 annual increase in GDP each year by 2030 and $1,155,429,644 by 2040.
Region 10: The Detroit metro area, including Macomb, Oakland, and Wayne counties focused on the densely populated urban and suburban areas surrounding Detroit.
- The report projects 24,073 new jobs annually by 2030 and 40,240 by 2040.
- It also projects a $2,956,361,610 annual increase in GDP each year by 2030 and $5,224,596,535 by 2040.
Alongside breaking down the economic impacts by region, the report also polled and interviewed 20 members of the Michigan Energy Innovation Business Council, a trade organization focused on supporting innovative energy technology.
In the survey, 75% of companies indicated they were hiring or understaffed, with 90% indicating they would need to hire or they would be understaffed in the next three years.
To further support Michigan’s clean energy, the report shares policy recommendations including additional state policies advancing the growth of clean energy and decarbonizing the state’s building and transportation sectors in line with Whitmer’s MI Healthy Climate Plan, continued investment into clean energy projects and monitoring and evaluation to ensure energy goals are met.
The report also advises lawmakers to enact a new policy on conducting cumulative impact assessments to determine the effects of retiring existing energy assets and building new projects, to ensure communities of color and low income communities and communities with a history of disinvestment can reap the benefits of clean energy.
Additionally, it recommends taking steps to reduce the amount households spend on their energy bills by ensuring that cost reductions for energy utilities translate into savings for customers.
In its final recommendation the report calls on the state to develop workforce training programs in support of the clean energy sector, placing a focus on ensuring opportunities for those transitioning away from traditional energy industries like those based in fossil fuels.
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