Michigan Businesses and Schools Urge Gov. Granholm and Legislative Leaders to Support Competitive Electricity Markets

WASHINGTON, D.C. – A leading group of national and Michigan-based businesses and schools today urged Michigan Governor Jennifer Granholm and legislative leaders to support the continued evolution and implementation of competitive electricity markets. The letter, signed by businesses representing more than 74,600 Michigan employees, noted the measurable benefits to consumers from Michigan’s retail and wholesale electricity market.

“Electricity competition has contributed to Michigan’s economic growth, promotes conservation and energy efficiency, facilitates renewable energy development, and provides the best route toward energy independence. In addition, wholesale and retail electric markets will bring about and sustain the most competitive prices for consumers,” the letter states.

The signatories, who collectively represent 2,111 facilities and over $110 million in annual electricity consumption, include: 7-Eleven Inc., Alticor Inc., Belle Tire Distributors Inc., Big Lots Stores Inc., Big Rapids Public Schools, Chippewa Hills School District, Coding Products, Dart Container Corp., Evart Public Schools, Haworth Inc., Home Depot Inc., JCPenney, Johnson Controls, Leggett & Platt Inc., Liebovich Brothers Inc., Macy’s Inc., Mecosta-Osceola Intermediate School District, Morley Stanwood Community Schools, Mosaic USA, Perrigo Company, Reed City Area Public Schools, Spartan Stores, Western Michigan University, and Yum! Brands Inc.

The letter was issued in response to legislation before the Michigan House of Representatives that would radically alter Public Act 141, which created electric competition in the state.

The businesses and schools expressed their concern about the potential for increased costs if the state took steps to roll back electricity competition.

"At Western Michigan University, we estimate that the proposed legislation will increase our utility costs by at least $400,000 per year. Considering that Michigan public universities’ state support is down over 10 percent from 2003 levels, such increases can only come from increasing the burden on our students,” said Lowell Rinker, university CFO and vice president for business and finance. “We consider it very important to preserve a competitive environment in our attempts to manage the cost of education."

The signatories also highlight the environmental benefits brought by competitive markets.

“Studies confirm that competitive suppliers lead the way in the development of renewable sources of electricity. According to the U.S. Department of Energy, 71 percent of new wind capacity in 2006 was built by independent power producers. In addition, competitive suppliers own 85 percent of total wind capacity,” the letter noted.

COMPETE, a national coalition of over 200 members that promotes the continued evolution of competitive electricity markets, commended the signatories.

“These Michigan businesses, schools and others around the country recognize that for too long energy costs has been a fixed component of operating costs. Restructuring and competitive markets allow businesses to lower their costs by negotiating deals for their energy supply just like they are able to do with almost every other aspect of their business expenses,” said Joel Malina, COMPETE’s executive director.

“When it comes to driving innovation and efficiency, the core objectives of a sensible renewable energy program, there is no substitute for competition. We participate in markets for virtually all goods and services, and believe that electricity competition is the path forward for Michigan,” the letter concludes.

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