MPSC considers requiring utilities to account for public health costs of future electricity generation

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Electricity generation from coal and gas-fired power plants exact an inequitable health cost that utilities should account for when planning for the future.

That’s according to testimony submitted on April 28 to the Michigan Public Service Commission (MPSC) by the Great Lakes Environmental Law Center on behalf of 23 individuals and organizations. 

MPSC opened the docket in August of 2020 as part of an effort to better integrate resource planning with planning for distribution and transmission. But it’s also seeking input on methods for incorporating environmental justice and public health considerations into how utilities plan to meet future energy needs.

The findings will inform new rules for filing requirements in utilities’ integrated resource plans (IRPs). In 2016, Michigan began requiring utilities to file IRPs with the MPSC every five years that project demand and the mix of energy resources to meet demand over the next 5, 10, and 15 years. 

In December 2019, Administrative Law Judge Sally Wallace issued a 197-page opinion on DTE’s initial IRP, forcing the utility back to the drawing board. Wallace wrote that “public health impacts, to the extent these impacts can be identified, assigned, and the associated costs quantified, should be recognized as part of the retirement analysis in future IRPs” and that “DTE customers living in proximity to the company’s fossil generating plants are certainly paying healthcare costs associated with exposure to air pollutants emitted by these units.”

Wallace cited the work of George D. Thurston, a Professor of Environmental Medicine at the New York University School of Medicine, who documented adverse health impacts resulting from exposure to pollutants emitted by fossil-fuel electricity generation. Thurston noted decreased lung function, increased childhood asthma and heart attacks, increased ER visits and hospitalizations, and higher death rates in those exposed to air pollution, that it is “quite feasible for a utility to evaluate public health impacts in an IRP” and that “DTE should be required to assess public health impacts, and their costs, as part of its planning for fossil generating units.”

One method for evaluating public health impacts is through a Health Impact Assessment, defined by the Centers for Disease Control as a “process that helps evaluate the potential health effects of a plan, project, or policy before it is built or implemented.”

GLELC executive director Nicholas Leonard included unpublished research conducted by University of Michigan researchers in the testimony, including an HIA of DTE’s current coal-fired power plants. 

“This is the first time the public service commission is engaging in public health and environmental justice issues in the integrated resource planning process,” Leonard said. “These are things that the Michigan Environmental Justice Coalition and GLELC have been thinking about for a long time. And so we want to lay a strong foundation for building those considerations into the process for future consideration.”

The UM researchers’ HIA found that DTE’s coal-fired power plants are disproportionately located in communities of color. The health burden resulting from the air pollution they generate disproportionately falls on low- to moderate-income neighborhoods primarily inhabited by African Americans, Latinx, and Arab Americans. The analysis also showed that high household energy burdens, low residential energy efficiency, and extreme heat exposure are concentrated in the same census tracts that are more exposed to DTE air pollution.

“There are substantial health impacts of current energy production,” said Dr. Amy Schulz,  one of the researchers and professor at the University of Michigan School of Public Health. “And we have opportunities as part of the integrated resource planning process to examine those and to modify decisions in ways that reduce harm, that also allows us to look at equity. We have opportunities to reduce the inequitable distribution of health costs.”

According to the analysis, health costs attributed to exposures from DTE emissions in some Wayne County census tracts cost as much as $183 per person annually. In less-exposed census tracts in the region, those costs were as low as 17 cents per person. 

At the same time, people living in higher-exposure census tracts enjoy less benefit from power generation. Those areas tend to be disproportionately more impoverished and inhabited by people of color. They tend to have less energy-efficient housing and a higher energy burden, or proportion of income going to pay energy bills.

“The decision-making about our energy future must include the true costs of energy, and take into account the disparate health impacts on communities of color and low-income communities who too often bear the pollution burden of our current energy system, while unable to affordably enjoy its benefit,” said Dr. Tony Reames, one of the researchers and an assistant professor at the University of Michigan School for Environment and Sustainability.

GLELC’s testimony recommends that the MPSC require utilities to conduct a Health Impact Assessment for each model run required by the Michigan Public Service Commission and each scenario proposed by the utility as part of future IRP requirements. Current rules do not require utilities to consider the public health or environmental justice impacts of electricity generation in IRPs. 

MPSC Chair Dan Scripps said the commission has already asked EGLE to include public health and environmental justice considerations as part of its required filing in IRP cases going forward. MPSC staff is expected to issue its report on the docket on May 27, informing the commission’s work to update planning parameters and filing requirements for integrated resource plans, as required every five years by statute. Until then, the public can comment in the docket or endorse GLELC’s testimony.

In the interim, three Michigan utilities including Consumers Energy, are scheduled to issue IRPs this year. MPSC staff issued guidance in February on modeling requirements designed to address the goals of Gov. Gretchen Whitmer’s September executive directive setting a goal for Michigan to achieve a 28% reduction to economy-wide carbon emissions compared to 2005 levels and establishing the MI Healthy Climate Plan. Scripps noted those requirements will also help address health and justice issues.

“We wanted to accelerate the inclusion of the governor’s goals… and how those match up with the utility plans,” Scripps said. “And we needed to do that before the planning parameters, and filing requirements were formally completed in 2022.”

Consumers Energy responded to a request for comment with an emailed statement from public information director Brian Wheeler: “Consumers Energy stands unapologetically for diversity, equity, and inclusion. We commend efforts by the MPSC and EGLE to consider environmental justice and health in important energy issues that affect Michigan. Consumers Energy will file a new IRP this summer and has considered environmental justice and health in our planning.”

GLELC’s testimony also recommends utilities collect race, income, and geography data to identify race and income-based inequities in utility operations. 

“We need more robust data collection to identify the inequities that we think likely already exist in utility operations, just as they exist in all facets of our society,” Leonard said. “And without that data, you can’t meaningfully promote environmental justice.”

Scripps declined to comment on whether the MPSC might ultimately require HIAs in IRPs or require utilities to collect race and income data around their operations, citing the need to allow the process to play out. But he acknowledged that the recommendations align “directionally” with the MPSC’s thinking.

“We want to see more data. Having the information is the starting point. I think there are probably different ways to get it,” Scripps said. “We’re asking how do we get a better record on public health and environmental justice in our IRPs, how do we start getting more granular data to make sure that we’re aware of how the system’s functioning and places where it can be improved.”

This report was made possible in part by the Fund for Environmental Journalism of the Society of Environmental Journalists. SEJ credits its foundation partners and other donors for supporting this project.

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