ESCANABA — The Escanaba City Council took a series of actions Thursday related to renewable energy in the city.

The first energy-related item on Thursday’s agenda was a proposed net metering policy. Net metering policies set the standard for how much power can come from consumer renewable energy sources, such as residential solar panels, as well as how much residents are paid for energy they produce.

Currently, three residents produce power that is sold back to the city at retail electric rates, however, those electric customers are only offsetting a portion of their total electric costs. If the customers were to produce more power than they consumed, the city would be required to pay the difference. Without a policy in place, any new customers producing power would also have been paid at the retail rate.

There was some question as to whether or not a policy was necessary at all, and there is no legal obligation for the city to adopt one. While being on the hook for payments to customers who over-produced power was one concern, the primary concern for the council was the effect having a policy would have on the city’s existing power purchase agreement with NextEra Energy, Inc. Under that agreement, the city is only allowed to produce 4 megawatts of power, including energy produced through net metering. As the number of customers taking advantage of net metering increases, the city’s ability to produce power through things like the Escanaba Solar Project diminishes.

Whether or not power from residential customers would apply to the 4 megawatt limit without the policy in place was unclear. Council Member Ralph Blasier argued it was unlikely NextEra would simply forget about the power coming from energy customers.

“That’s silly, the meter’s going to be running. Just because we don’t have a policy doesn’t mean NetEra ignores it. It would count, it just wouldn’t count as easily,” he said.

Multiple members of the council wanted to have the input of the city’s electric advisory committee, which had been made aware of the draft policy via email but by and large hadn’t weighed in on it.

However, a new customer is slated to begin net metering next week, prompting the council to act quickly. The council approved the policy as written and directed Electric Superintendent Gerald Pirkola to have the policy reviewed by the Electric Advisory Committee at the group’s next meeting. The council will then review the committee’s suggestions and amend the policy as appropriate if needed.

The council then moved on to the city’s own solar power generation system. Residents can purchase panels at the Escanaba Solar Project in exchange for billing credits based on the amount of energy the panel produces. Currently, a pannel costs $399, but in order to make the panels more attractive as their lifespan diminishes, the council approved a depreciation schedule that will reduce the cost of the panels by about $16.63 per year. The new price for 2021, $382.38, will take effect July 1 with the start of the new fiscal year.

Blasier questioned whether the depreciation schedule was formulated appropriately given the rising cost of energy and what he sees as inevitable inflation. City Controller Melissa Becotte explained to the council the city’s depreciation schedules don’t factor in inflation or other variables. City Manager Patrick Jordan recommended revisiting and potentially recalculating the schedule as needed in future years.

The final energy-related action was the council’s approval of the purchase of 15,000 renewable energy credits from the City of Norway at a cost of $2.50 per credit. By law, the city must make a certain amount of its energy from renewable energy or purchase credits to offset what it does not make itself. Norway produces its renewable energy from hydroelectric and offered the credits at the lowest cost.

In other business, the council:

– Held a public hearing on and approved amendments to the city’s appropriation’s ordinance. By law, the city’s budget must balance at the end of the fiscal year, and making annual amendments allows the city to modify the document as needed to avoid overages due to unanticipated spending.

– Approved the purchase of property and liability insurance coverage from the Michigan Municipal Risk Management Authority in the amount of $214,167. This purchase was included in the city’s budget.

– Sold Lot 1 near the former Escanaba Power Plant to Northern Machining & Repair.

– Approved a resolution supporting the Bonifas Arts Center’s application for a grant from the Michigan Council for Arts and Cultural Affairs. If approved, the grant will fund the Music Monday’s concert series in 2022.

– Approved a letter of support for a microgrant application from the Bridge Builders Main Street program. Due to scheduling issues preventing some portions of the process from being completed, it is not believed the grant will be successful. Still, the council felt it was important to support all grants sought by the city.