Two new bills passed by the Michigan House of Representatives on Wednesday would allow the Upper Peninsula (UP) to continue using its natural gas-powered generators, despite new clean energy regulations introduced by the Michigan Clean Energy and Jobs Act.
The act requires the state to transition to 100% clean energy sources by the year 2040. However, the UP’s existing reciprocating internal combustion engine (RICE) generators are set to remain in operation until 2050. These bills would let the UP keep using those generators until their expiration date.
The RICE generators were installed in 2019 after the UP moved away from coal-based energy. While the change reduced carbon emissions, the generators still run on natural gas, which means they do not meet the new clean energy requirements.
State Representative Dave Prestin (R-Cedar River), who supports the legislation, said the issue is critical for the UP and the entire state.
“The Tilden Mine—the second-largest iron ore mine in the country—uses 60% of the UP’s electricity,” Prestin said. “Energy costs make up 25% of its total operating budget. If we don’t change the 2023 law, the mine will face a $1.3 million monthly surcharge starting in 2027. That fee will grow until it reaches $15 million a month by 2040. And that’s just before they even turn on a light. No business can survive that.”
Prestin also warned that closing the mine could have major consequences across Michigan.
“If Tilden shuts down, it will hurt thousands of union jobs across the state. That includes workers at steel mills and auto plants in southeast Michigan,” he said.
Residential customers could also see steep increases in their power bills. According to Prestin, the surcharge would add $90 a month for homeowners. Small businesses, like his former gas station, would pay about $3,500 a month. Large industrial users could face monthly bills over $300,000.
Despite using natural gas, lawmakers say the UP has already reduced its carbon dioxide emissions by more than 70%.
Next the bills will make their way to the state Senate.
