Michigan utility Southern Michigan Power said Wednesday it will charge solar panel customers $.02 per kiloowatt-hour to use the sun for energy.
Solar energy is typically billed at a higher rate because the sun emits more energy, but the new rate for residential customers will not change the way they get their electricity.
The new charge applies to residential customers who do not have solar panels installed on their homes.
The rate increase will be effective March 1.
SMP said it will now begin charging residential customers for energy when they first sign up for their residential service plan, and then for energy in the future as they purchase energy from SMP’s renewable portfolio standard (RPS) credits.
Energy savings for residential energy customers will be reduced from $1.35 per kilovolt to $.01 per kilotons per month, but customers with solar panels on their roofs will not be impacted.
Electricity costs will also be reduced by an average of $0.25 per kilolt.
Jennifer Granholm said the new fee will help customers save on the cost of installing solar panels.
“I believe that if we are smart about this, it’s going to save our state money,” Granholm told reporters.
Last year, the Michigan Department of Energy and Environmental Control issued a report stating that residential solar energy was responsible for only one-third of the state’s energy costs.
It also estimated that Michigan generated less than 2% of the nation’s energy from wind and solar.
However, the new solar energy rate is expected to be an increase to reflect the new efficiency of the panels.
Solar panels, as they currently are, have a maximum efficiency of 1,500 watts per square meter.