Blog Posts For The Week Of April 23, 2016 Through April 29, 2016

Remembering Politicians Who Understood Politics Was Just Business
By John Lindstrom
Publisher

Posted: April, 29 2016 3:36 PM

Sometimes unpleasant things have meaning, and so it is this reporter has often talked about how the “Tessio Rule” should always apply to politics.

It seems particularly urgent one should abide with the rule, in light of the stunning news earlier this week about Oakland County Republican activist Paul Welday.

If you have not seen “The Godfather,” then you really should because it is one of the greatest motion pictures ever. It is about the Mafia, and hence a number of unpleasant things occur. Toward the end of the picture, one of the Corleone family’s most loyal lieutenants, Sal Tessio, has been discovered to be a traitor and as he is being led off to his death (the scene is available on YouTube) he says with as much dignity as he can that his treason was just business, not personal, that he always liked the head of the Corleone family.

That is a lesson needs to be learned again and again in politics. It is a lesson Mr. Welday understood inherently. And it is a lesson known and practiced by a number of individuals Michigan has lost in the last year.

Ken Brock, Matt Davis, Curtis Hertel Sr., and now Mr. Welday, two Democrats, two Republicans, all died, and much too early, in the last year, And all of them understood where the personal and the political separated.

Each of them was a dedicated advocate for their position and party, none of them were shy about sticking it to the other party. But that was business, always just business. Life itself is personal. In life itself, politics steps aside.

Out of the fray, off the field, they held no animus. They believed firmly in what they stood for, which meant they also understood there was a chance they could be wrong and the other guy was right. Which also meant they could learn from the other guy. Which also meant they understood the emotions the other guy would feel, the difficulties the other guy would endure, they knew the difficulties their families would endure, understood that in large part they played their role in politics so they could make things better for their families and for every family. Which also meant if they did not agree on anything political, they understood and agreed on all things essential. And the essential things are always people and not ideas, and they knew that.

The late Sen. Harry Gast -- whom we also lost in the last year, but who at 94 enjoyed the long life denied Mr. Brock, Mr. Davis, Mr. Hertel and Mr. Welday -- once said it was time “to put aside principle and do what’s right.” And these four men subscribed to that philosophy, which made them all the better.

It has always been hard in politics to understand that essential rule. There are sides to take, positions to hold, opponents to defeat. It is easy, far too easy, to be consumed into the warrior state of politics, to presume the other side is less than you are and fit for subjugation.

But as people come together this weekend to remember Mr. Welday, it is important to recall that he was a husband, a father, a friend, a colleague, a patriot and then somewhere farther down the list a Republican. The same was true for Mr. Brock, Mr. Davis and Mr. Hertel (only Mr. Hertel and Mr. Brock were Democrats).

In a political world, during a particularly political year, they all remembered the best politicians weren’t political at their core. That made them all good politicians, but it won’t be the main reason they will be remembered.

A Cheat Sheet For Your Next Energy Hearing
By Danielle Emerson
Staff Writer

Posted: April, 28 2016 2:06 PM

The Senate Energy and Technology Committee on Tuesday adopted a pair of substitutes in its two-bill proposal to revamp Michigan’s laws governing the structure of the energy market, and with it came a few new words we haven’t heard before, as well as others that were less frequently used.

Since it looks like energy policy is kicking up once more with a very real possibility that something gets done by the end of the year, if not by summer recess, we’ve put together a handy guide for to navigate the alphabet soup of acronyms and terms so jargon-centric they seem to be in a language other than English. For better or worse, this list only scratches the surface.

Regulated utilities: Sometimes referred to as an incumbent utility. There are primarily two types of utilities/electric providers/energy providers in Michigan – those whose operations are overseen by the state’s Public Service Commission (see below) and those who are not. Most frequently, people think of DTE Energy and Consumers Energy as the chief regulated utilities, namely because they control a whopping majority of the state’s energy market.

Public Service Commission/PSC/MPSC: The entity, housed within the Department of Licensing and Regulatory Affairs, composed of three members appointed by the governor who serve staggered six-year terms. Their primary goal is to make sure folks are paying the most reasonable price they should be for energy and that any kind of requests by utilities are not overly burdensome on the consumer.

PSC is the chief governing body when it comes to reviewing rate cases and usually brings utilities down from self-implementation of rates (in which the utility literally sets its own rates to adjust for various other factors). They also ensure reliable energy and telecommunications services, though the latter part of that is not relevant here.

MISO: Although they’re spelled the same, legislators are not talking about the soup you get at the sushi place. This stands for Midcontinent Independent System Operator, which oversees the functions and operations of energy, from whatever source, in several Midwest states including Michigan. They’re not allowed to tell utilities to build generation nor can they build themselves. MISO is overseen by FERC, the Federal Energy Regulatory Commission.

Renewable energy/RPS: Things like wind, water and sun that are built in a manner that produces electricity. The state, in 2008, mandated a specific renewable portfolio standard, thus the acronym RPS, that further defined permissible renewables and how much of them. The Senate is now talking about a blended goal that combines a utility’s use of renewables and their participation in energy optimization (see below). Also sometimes referred to as clean energy.

Energy choice/retail open access/AES: All right, this is a long one – lots of components and controversy. It’s a reference to the 2008 energy law (see below) that, depending on your point of view, required or limited 10 percent of the energy-supplying market be reserved for alternative electric suppliers, also known as an AES.

This is a highly contested part of the state’s previous energy law because purportedly there are lots of customers in the queue who are waiting to pay usually cheaper prices to receive their energy from that AES. But there is also the question of whether those alternative companies should have to pay their proportionate share to play in the game, if you will. You also sometimes hear the terms fully regulated market or deregulated market here. Michigan is considered to have a hybrid system because of the choice provision.

The 2008 law: This refers to the last time Michigan enacted a new energy policy, and it is essentially what is currently being rewritten in the House and Senate because some of the provisions have expired or outlived usefulness. Among its key provisions are requiring that all regulated utilities generate 10 percent of their energy through renewable resources by 2015 – which they’ve achieved – and reserving 10 percent of the market for ratepayers to get their energy through an alternative supplier. It also established some goals for energy optimization (see below) that are far less contentious than other parts of the law, and those too are being reviewed.

Energy optimization/energy efficiency/energy waste reduction: The Senate proposal renames energy optimization programs to energy waste reduction programs, a term first coined by Governor Rick Snyder when he gave his special message on energy. Energy optimization (EO) programs were established in the 2008 law that required gas and electric utilities to implement programs to reduce overall energy usage by certain targets that then relieve load management for the utilities generating, buying and selling that power to you. The utilities have long since achieved their targets, so those are obviously under review as well.

Also relevant here is the idea of on-bill financing, which is a loan made to a utility customer to pay for energy efficiency improvements, which are then paid back by the customer over time.

Resource Adequacy: Quite simply the ability of a utility to demonstrate that it has enough energy for its customer base.

Net metering/Distributive generation: One in the same. For some reason, the Senate decided to rename it. Net metering is a program that allows customers of utilities, cooperatives and an AES to develop on-site renewable energy electric generation to meet some or all of their needs and then reduce their electric bills in doing so. This also, in theory, reduces the load that utilities have to be responsible for, though utilities say it does not address the fact that the grid is still technically in use at some point in the process. Great infographic here on PSC’s website.

Also possibly relevant here is a Power Purchaser Agreement, known as a PPA, which is a contract between the person or company that generates electricity and one looking to purchase the electricity. Some companies have this with utilities because those companies are producing their own power, such as through the use of solar panels.

Integrated resource plan/IRP: Very big component of the Senate proposal. It’s essentially a planning process utilities would have to go through before they could purchase new facilities for new generation or retrofit others to better serve their customers. Interveners are those who are not incumbent utilities who can file their own motions on the ability to provide such electricity in an ideally cost-effective manner.

Certificate of need: A process through which a utility can recover its expenditures on certain projects, like a new generation facility, through a power supply cost recovery (PSCR) factor.

Local Clearing Requirement/LCR: This requirement represents the amount of resource capacity, measured in megawatts, which must be cleared in a particular Local Resource Zone (read: region) in order to meet certain MISO standards for that zone.

Snyder Facing A Difficult Decision On Lyon
By Zachary Gorchow
Editor

Posted: April, 26 2016 3:57 PM

If the various inquiries into the Flint water crisis eventually lead to the departure of Department of Health and Human Services Director Nick Lyon from his post, it cannot be overstated what a cataclysmic loss that would be to the administration of Governor Rick Snyder.

Prior to the Flint water crisis, and the criticism the department has taken for initially botching the analysis of children’s blood lead levels and not doing more to combat a deadly Legionnaire’s disease outbreak possibly related to the water problems, Mr. Lyon was a star department director in the administration.

The enormous restructuring of the government in early 2015, merging the departments of Human Services and Community Health into one Department of Health and Human Services occurred in significant measure because Mr. Snyder and the key stakeholders all had confidence Mr. Lyon could pull the merger off. Yes, there were policy reasons behind the idea, but the Lyon factor was significant.

Community Health, which Mr. Lyon had helmed since August 2014 and been a deputy director for several years, was generally known as one of the best-functioning agencies in the state government. The expansion of Medicaid to those at 133 percent of the federal poverty level went off remarkably smoothly.

In the more than a year since Mr. Lyon has been in charge of Human Services, those who work with the department say they have seen a real difference in operations there.

The task force Mr. Snyder appointed to investigate what led to the water crisis seemed almost pained in some ways about the Department of Health and Human Service’s performance. What happened contrasted sharply with its usual operations, the task force said.

And yet, the water crisis errors were massive.

Had the department properly analyzed blood lead levels, the issue of lead in the drinking water would have been discovered sooner.

Had the department sounded a loud public alarm about a Legionnaire’s outbreak in late 2014/early 2015, that would have come at the same time as public concerns about the use of the Flint River as the city’s water source were escalating amid boil water advisories as well as discolored and foul smelling water.

The Office of the Auditor General, at Mr. Snyder’s request, is looking into what went wrong in the department, and when Mr. Snyder has been asked why he has not replaced Mr. Lyon, his responses have offered tepid – at best – support for him.

There are three schools of thought circling the Capitol on the fate of Mr. Lyon.

The first one, held by many Democrats, is simply that he has to go. This is notable in the sense that Mr. Lyon is something of a nonpartisan figure, having worked his way up from the State Budget Office during the administration of Governor Jennifer Granholm. He has had some Democratic supporters historically.

The second one, held by many of those sympathetic to former Department of Environmental Quality Director Dan Wyant, who resigned at Mr. Snyder’s request, is to question how Mr. Lyon can remain in his post if Mr. Wyant had to go.

The third one, held by Mr. Lyon’s supporters, is that kicking him to the curb after he successfully executed Mr. Snyder’s merger of two huge departments would not only be a total betrayal, but also would severely undercut the still nascent merged department. No one is indispensable, they say, but Mr. Lyon is uniquely qualified to oversee such a complex operation.

For Mr. Snyder, it’s a decision sure to anger many and please few, no matter what he decides.

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Blog Authors

Gongwer Staff

John Lindstrom
Publisher
jwlindstrom@gongwer.com
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Zachary Gorchow
Editor
zgorchow@gongwer.com
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Danielle Emerson
Staff Writer
demerson@gongwer.com
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Alethia Kasben
Staff Writer
kasbena@gongwer.com
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Christopher Klaver
Staff Writer
cklaver@gongwer.com
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