Michigan’s Public Act 233: What Renewable Developers Need to Know

In support of the State of Michigan’s ambitious clean energy and decarbonization goals, Governor Gretchen Whitmer passed Public Act (PA) 233 on November 8, 2023, as part of a five-act energy legislation initiative. According to the Michigan Public Service Commission (2024), this act will create a secondary siting process overseen by the Michigan Public Service Commission (MPSC).

Prior to PA 233, renewable energy developers faced a wide range of siting approval hurdles in Michigan, such as a lack of compatible zoning ordinances, excessive ordinances, or a community’s refusal to review certain types of projects by enacting moratoriums while ordinances are developed. PA 233 addresses many of these challenges.

What is Public Act 233?

Based on PA 233, the MPSC can overrule local ordinances if and when it is convinced that doing so is necessary to ensure a reliable electric grid for Michigan residents. It is an attempt by State legislators to balance a community’s local control and society’s utility needs.

Contrary to some misconceptions, Public Act 233 is not the State exercising its ‘eminent domain’ powers – which Cornell Law School explains as the power of the government to take a landowner’s private property and convert it into public use, even if the landowner doesn’t want to sell. Instead, PA 233 offers developers a second way to gain approval for developing a site with an accepting landowner.

Effective November 29, 2024, PA 233 applies to energy development and energy storage facilities that affect the utility grid on a statewide level. This includes 50 MW or larger solar energy facilities, 100 MW or larger wind energy facilities, and 50 MW energy storage facilities with 200 MW hours capacity or more.

As the newest element in an already complex and challenging conversation between the local government and the MPSC, PA 233 is believed to be written to incentivize negotiations amongst each party to avoid escalating the case to the State.

For example, let’s say the developer finds a roughly 340-acre agricultural site where they want to build a solar farm and secures an agreement with the landowner. Following PA 233’s recommended 50ft setback, the project would result in roughly 325 acres of land that can generate between about 55 MW of power. This actual output would also depend on site factors such as forested areas, ponds, wetlands, powerlines, pipelines, panel and racking type, and existing farming structures. However, if the township’s ordinance requires an excessive 500-foot setback off all property lines, that reduces the developer’s usable area down to less than 190 acres, generating about 30 MW.

Although we’re unsure if the MPSC will rule in all cases to allow the developer to move the facility 50 feet off the property lines, we can suspect that a local government entity would prefer the facility to be 75 or 100 feet off the property line, as the negotiation may result in, rather than 50 feet. Additionally, local residents may prefer to resolve conflicts at the local level rather than escalate to the State’s stage, where more outside voices get involved.  

What do renewable energy developers need to know about Public Act 233?

Regardless of the governmental entities’ current zoning ordinance, it’s crucial for the developer to gain the community’s support. Becoming a presence in the community, talking with stakeholders, and gaining participating property owners could be crucial to achieving approval and the overall success of the project.

At that point, PA 233 incentivizes negotiations among the two stakeholders. A developer could gain this much-needed support by presenting the personal benefits residents receive, such as cleaner air and a more capable electric grid, and community benefits, such as addressing the energy production capacity shortfall, proposed community-benefit agreements, and business tax dollars given to their community. Once enough residents are interested in participating in the project, the developer can create a site plan and present it to the governmental entity.

It’s also important to note that gaining this support may require time and patience. On the local level, many social factors affect residents, whether it be the distribution of misinformation or increasing tension among people with diverse beliefs. Renewable energy developers must keep in mind that local planning commissioners are largely a team of volunteers who face immense pressure from differing opinions while trying to do “the right thing” for their community.

Putting in this constituent public engagement effort early and often is crucial for renewable energy developers who want to pursue approval on the local level by all possible methods. Although seeking site plan approval through the MPSC is now a possibility, it will likely require a longer permitting duration, which means extensions of a developer’s project timelines and budgets.

Additionally, if the local municipality refuses to make sufficient compromises, each case a developer brings to the MPSC will require the developer to pay that local municipality $75,000 to represent themselves during the MPSC proceedings. This is critical when the developer is considering upfront vs. long-term costs.

As if balancing local governmental entities and State jurisdiction were not enough for renewable energy developers to balance, they must gain additional approvals from other jurisdictions, such as construction code permits, meet local fire marshal and fire code requirements, and achieve grid-interconnection agreements timelines.

Between gaining approvals from all authorities having jurisdiction, achieving community support, and fine-tuning development plans, renewable energy developers have plenty to juggle.

Metro Consulting Associates (MCA) can help. We’re highly experienced in assisting renewable energy developers as they navigate siting for new utility-scale projects, permitting considerations, and ensuring the project maintains its schedule.

With a dynamic renewable energy team filled with professionals who are experts in due diligence, ecological assessments, land surveying, project permitting, and civil engineering design support, we can help developers bring their projects smoothly across the finish line.

Learn more about our renewable energy capabilities and contact MCA today!