Energy

Michigan House Bill 6249 establishes that ownership of subsurface pore space, which can be used for storing carbon dioxide or other substances, is vested in the owner of the surface land unless it has been previously separated. The bill allows this pore space to be sold, leased, or otherwise transferred independently from the surface estate, provided that any such separation clearly describes the specific geological formation, depth, and scope of surface use rights involved. It clarifies that selling mineral rights does not automatically transfer pore space ownership, which must be explicitly stated in the agreement. This legislation takes effect only if two related companion bills are also enacted into law.

Michigan House Bill 6248 updates the definitions in the state's crude oil and petroleum act to explicitly include carbon dioxide substances used for storage or enhanced recovery operations. The bill clarifies that individuals and companies do not have an inherent right to transport, store, or deal in these substances via pipelines without authorization from the Michigan Public Service Commission. It also specifies that this regulatory framework does not apply to rights that existed before 1929 or to carbon sequestration wells operating under separate environmental laws. This legislation is tied to two other bills and will only take effect if all three are enacted into law by the current legislature.

HB 6247 establishes a comprehensive regulatory framework in Michigan for the geologic storage of carbon dioxide, requiring operators to obtain permits from the Department of Environment, Great Lakes, and Energy that align with federal standards. The bill authorizes the leasing of state-owned lands and pore space for these projects, while permitting specific surface activities on commercial forestland and wilderness areas under strict conditions to protect natural resources. It creates a unitization process to manage shared subsurface interests among multiple property owners and mandates long-term monitoring of storage sites for at least 50 years after injection ceases. Upon successful completion and verification of site safety, the state assumes ownership and liability for the stored carbon dioxide, releasing the original operator from future regulatory responsibilities.

This bill requires electric and natural gas utilities in Michigan to use a competitive bidding process for all contracts related to construction, operations, maintenance, and capital improvements. To enforce this rule, the state's public service commission will be prohibited from allowing utilities to recover costs for work that was not competitively bid, and the law grants ratepayers and bidders the right to sue for damages or injunctive relief if the process is not followed. Additionally, all bids and related documentation must be treated as public records and made available for inspection by anyone. The legislation defines "competitive procurement" by referencing specific federal standards that local governments must follow.

This bill updates Michigan's renewable energy requirements for electric providers, setting specific portfolio goals of 15% by 2029, 50% between 2030 and 2034, and 60% starting in 2035. It allows certain cooperatives and multistate providers to lower their targets if they already generate significant clean energy within the state or have existing nuclear contracts. The legislation also introduces financial incentives for providers entering new renewable energy contracts with non-affiliated entities and permits a small portion of energy savings credits to count toward renewable goals. Additionally, it clarifies rules for purchasing renewable energy credits, limiting such purchases to 5% of the total annual requirement and banning their use after 2035.