Policy Tracker: Michigan taxpayer-funded methane infrastructure & tax credits for ethanol sales?

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Dear Michigan Climate News readers,

This edition of our monthly policy tracker explores bills to promote ethanol and a funding measure to promote methane gas infrastructure. These updates follow the European Parliament's designation of natural gas as a "green fuel" for investment purposes and begs the question: Is gas green?

Our aim is to help keep you up-to-date on the latest state and federal government policies that impact climate and the environment in Michigan.

Please let us know if we're hitting the mark by emailing us at nina@planetdetroit.org.

And as always, please forward this to a friend who you think might be interested and encourage them to subscribe to our newsletter.

– Nina at Planet Detroit

On to the policy update:


Making sense of ethanol

A bill passed by the Michigan Senate, SB 814, looks to give tax credits to gas station owners for E15 and E85 ethanol sales. Environmental groups have pushed back on the legislation because ethanol can increase ozone levels, a problem in parts of the state. And growing more corn to produce the fuel could hurt water quality.

However, since ethanol is produced primarily with corn, agribusiness offered support for the bill. “Statewide availability of E15 across Michigan would drive demand for an additional 78 million bushels of corn annually, boosting incomes for our family farmers,” Bob Thompson, president of the Michigan Farmers Union, said during a Senate committee hearing.

The bill also coincides with a move by the Biden administration to allow for the sale of E15 during the summer. Sales had previously been curtailed to protect air quality. President Biden said the change could help lower gas prices, although some have questioned this, noting that not much ethanol gets sold anyway, and ethanol gets fewer miles to the gallon, cutting into any benefit from lower prices.

As for air quality, although using ethanol emits less carbon dioxide than other forms of gas, E15 and E85 emit more compounds that contribute to ozone formation. This could be bad for places like metro Detroit where ground-level ozone has increased in recent years.

Yet, air quality isn’t the only environmental issue with ethanol. Growing corn can require water, and while states like Ohio can grow most corn with irrigation, Nebraska farmers need about 19 gallons of water for every bushel of corn they produce. Corn also requires large amounts of often synthetic fertilizer produced with fossil fuels. Environmental advocates worry that increasing corn production for ethanol could lead to more issues with nutrient runoff and poor water quality.

Recent research also questions whether there are any net greenhouse gas emission reductions with ethanol when the emissions of growing the corn to produce it are factored in.

In terms of cost, the Senate Fiscal Agency says SB 814 will reduce revenue for the state General Fund by about $2.3 million a year. Hallie Fox, state government affairs coordinator for the Michigan League of Conservation Voters, questions whether this is a good deal for Michiganders.

“You're talking about giving tax breaks to retailers instead of actual relief to the customers,” she said. Fox added that using state money to address gas prices that may already be falling isn’t a wise use of funds that could be directed towards long-term investments like the upgrades to drinking water systems and roads included in the $4.7 billion infrastructure bill passed in March.

More state policy updates:

‘Low-carbon’ infrastructure?: A group of advocacy organizations sent a letter to Gov. Gretchen Whitmer in early July asking her to issue a line-item veto on a $25 million in ongoing general fund appropriations to the “Low Carbon Facilities Fund” in the fiscal year 2023 Licensing and Regulatory Affairs departmental budget. The advocates write that the funds would support the expansion of methane gas infrastructure at taxpayer expense and promote further dependence on fossil fuels, a “dangerous proposition for Michiganders, leaving them vulnerable to volatile utility bills, negatively impacting resident’s health, and contributing to climate change.” Whitmer is expected to approve the budget soon.

Ballot initiatives: Promote the Vote, a voting rights ballot initiative backed by many environmental groups, turned in 669,972 signatures, well above the minimum of 425,059 required to get on the ballot. Meanwhile, the Secure MI Vote petition, which could make voting more difficult, failed to clear the lower bar of 340,000 signatures needed to exploit a loophole that allows petitioners to recommend legislation that could be passed without the governor’s signature. Secure MI Vote organizers say they will continue to collect signatures until they meet the threshold. (Bridge)

Water laws: Whitmer signed House Bills 5890, 5891 and 5892, the bipartisan package to make it easier for cities to fund upgrades to their water systems. The legislation could be especially helpful for smaller cities with difficulty funding the engineering studies needed to secure state financing. (MI Radio)

Tank consultants needed: SB 991, which would add restrictions on underground storage tanks to the Natural Resources and Environmental Protection Act, passed the state House and Senate and will be presented to the governor this month. The bill would primarily affect underground gas tanks and prevent new tanks from going in near many drinking water wells. Property owners could install new tanks in areas restricted by the law if these are certified by a professional engineer or qualified underground tank consultant.

Keepin’ it wild: Environmental groups are pushing back on Senate Resolution 150, which would have the chamber formally oppose new national wilderness areas in the Upper Peninsula. These groups argue that wild lands are vital to the U.P.’s economy and people.

Rock talk: With Senate Bills 429-431, legislators want to take the permitting for aggregate mines away from local governments and give it to the Department of Environment, Great Lakes and Energy (EGLE). This could make it easier to secure materials for road-building and other projects. But environmental advocates say this does nothing to address the underlying issue of a finite supply of these materials, which could be met with better mining practices and recycled materials.

Houses of worship: EGLE is making $1.24 million in energy efficiency grants available to congregations in low-income areas. The program is intended to support houses of worship that often serve as community centers and provide services like food assistance. The application for the program is available here.

Federal policy updates:

Welp: The Supreme Court ruled to restrict the Environmental Protection Agency’s (EPA) ability to regulate carbon emissions from power plants, making it more difficult for the Biden administration to meet its climate goals. The decision could open up more federal regulatory powers to challenges, and the court may already be on its way to doing so as it will consider a challenge to the Clean Water Act this fall. And President Biden may issue a climate emergency in the wake of Sen. Joe Manchin annihilation of the Build Back Better plan, allowing him to take executive action to fight climate change.(WaPo)

New PFAS limits: Last month, the EPA announced new drinking water limits for some PFAS chemicals in drinking water, setting guidelines of 0.004 and 0.02 parts per trillion for PFOA and PFOS. This marks a significant reduction, but it only applies to four of about 9,000 PFAS chemicals. These are guidelines, not enforceable limits. However, this could have profound financial implications for chemical manufacturers and the US military. (WaPo, Guardian)

Reversals: The Biden administration seemed to go back on a campaign promise not to allow new oil drilling on federal lands. Environmental advocates say an analysis from the Interior Department signals support for ConocoPhillips’ Willow project in Alaska’s North Slope, although the department did not issue a final decision. The project would release at least 278 million metric tons of carbon dioxide emissions over its lifespan. (NY Times)

Up north clean up: Petoskey will be getting some help cleaning up a former manufacturing site on the national Superfund list. The EPA will spend an estimated $5.5 million to clean up contamination at the former Petoskey Manufacturing Co. site, where improperly disposed solvents and paint sludge have been polluting soil and groundwater and causing “vapor intrusion” in homes and businesses.

At the Michigan Public Service Commission:

End of coal for Consumers: The Michigan Public Service Commission (MPSC) approved the settlement between Consumers Energy and various stakeholder groups to close the utility’s last remaining coal facility in 2025. Under the settlement, Consumers will also significantly increase its solar generation capacity and battery storage as well as increasing donations to an energy assistance fund for low-income customers. advocates write that the funds would support the expansion of methane gas infrastructure, which

Rising prices: Russia’s war on Ukraine and fallout from the COVID-19 pandemic are contributing to rising energy prices for Michigan consumers, according to the MPSC’s Energy Appraisal Summer Outlook. The agency directs residents to their “consumer tip sheet” for information on how to get help paying utility bills.

More info needed: The MPSC requested more information from Enbridge Energy on their proposal to move the Line 5 pipeline into a tunnel underneath the Straits of Mackinac. The agency is looking to get a better picture of engineering, safety and risk of fire or explosions for the new tunnel, as well as information on the existing pipeline in the straits, including systems for detecting leaks and shutdown procedures.

Rate increase: A $170 million natural gas rate increase was approved for Consumers Energy customers, a 40% reduction from the utility’s initial request.

Facebook! Web surfers will have another way to get in touch with their favorite public agency via MPSC’s new Facebook page. “The MPSC is excited to join Facebook to share information and broaden its public outreach at this important time, as Michigan’s transition to clean energy picks up pace, and there’s renewed work to ensure affordable high-speed internet service can reach all parts of the state,” MPSC Chair Dan Scripps said.


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