LANSING – Alternative energy could be one of the saviors of the Michigan economy. Department of Energy, Labor and Economic Growth Director Skip Pruss is working to turn that could into is. In the meantime, he is also working to see that much of the federal stimulus money coming to the state is put to the best use possible.
As the automobile industry continues to flag, Pruss told Gongwer News Service this week that opportunities are expanding in wind and solar energy, and in battery technology to store that power. He said those opportunities will bring jobs with them back to the state.
“There are a number of exciting opportunities about to be realized,” he said. “There’s a lot of grim news out there about the economy, but a lot of good news for Michigan.”
State officials have already announced some of the good news, with assistance to Hemlock Semiconductor to expand its production facilities for a base material for solar panels and to A123 for development of batteries now for both vehicle and large-scale storage.
Coming announcements could mean new ways of building wind turbines that would increase the output of the machines and reduce the cost to move and install them. He said all of these announcements stem from the state’s concentration of now underused automotive manufacturing.
“We wanted to capitalize on and utilize Michigan’s strengths,” Pruss said of the purpose of elevating energy to a department. “That entailed understanding Michigan’s strengths, benchmarking them against other states and trying to design and come up with a policy mechanism that no other state does.”
In addition to the new energy regulations that require utilities to adopt renewable energy and energy efficiency programs, he said the Centers for Energy Excellence is that policy.
With the Centers and some new tax breaks, “We have almost every multinational advanced energy company looking at locating in Michigan,” Pruss said.
The programs already in place will also give Michigan a leg up over other states as the Obama administration begins doling out federal assistance for alternative energy, he said. “We think these companies will be in an optimal position to qualify for the federal stimulus (in Michigan),” he said.
Some of that, he said, was by design. State officials began working with the Obama administration in December to be sure Michigan policies aligned with the then incoming president’s goals, he said.
As the world begins to look more at wind power, Pruss said the advanced manufacturing practices adopted by the auto industry will also have them looking to Michigan for parts. He said Dowding Industries, a Michigan-based supplier, is on track to have new processes in place for building some of the largest parts of the turbines, which now take some 24 hours to assemble, in a little over 3 hours.
“If Michigan can capture this and others, we’ll be on the map for wind energy,” Pruss said. “We have a vastly superior supply chain (to other states). …Our goal here is to be a regional manufacturer, a regional force in renewable energy.”
A national study showed Michigan is one of four states that could see substantial new jobs from the shift to alternative and renewable energy, he said.
Pruss said much of this is happening even before he really has his energy team up and running. He has been in his post since the end of October, but his department really started as it is in December.
The driving goal of that new energy team will be integration, Pruss said. “We want Michigan people to build it; we want Michigan people to sell it; we want Michigan people to install it; we want Michigan people to maintain it.”
DELEG is also working on more integration in the state. For instance, the Centers for Energy Excellence is technically not in DELEG; the program is housed in the Michigan Economic Development Corporation, but Pruss said that is another partnership that is growing.
“The MEDC and DELEG work far more closely than they ever have,” he said.
DELEG is also working to bring other partners to the table, like the departments of Agriculture, which has interest in biofuels, and Management and Budget, which buys power for the state.
“DELEG now is building capacity,” he said. “We’re focused like a laser on every opportunity to build out capacity.”
In addition to manufacturing capacity, the department is also working on generation capacity. Pruss said Ohio had declared it would be the first to have offshore wind generation in the Great Lakes, and he said it may be, but Michigan would be a close second.
“Now we’re in a race to deploy wind energy offshore,” he said, noting that not long ago it was not an anticipation such development would be allowed.
The Great Lakes Wind Council, created in the department to develop a plan for the offshore turbines, will begin meeting this month, Pruss said.
While energy is the newest focus of the department, Pruss said it works well into DELEG’s other areas of responsibility. For instance, the department also oversees the state’s job training programs.
“DELEG is all about economic growth and workforce development,” he said. “We’re training people not for the sake of training them but we’re training them in a demand-driven way.”
That means training programs in building alternative energy equipment and installing energy efficiency measures, among other things, he said.
“We have 28 community colleges. They all have a green curriculum,” he said.
Those training programs will be assisted by the upcoming Michigan Saves program allowing property owners to install energy-saving equipment and pay for it using the reduction in their power use.
“We want energy efficiency improvement jobs to be enduring and sustained,” Pruss said.
However, he said energy is still the smallest part of the department. “DELEG has 4,000 employees. About 40 employees are working in this energy space,” he said. “Our challenge is to build up this new capacity without a lot of new resources.”
The new focus also will not take any attention away from the department’s other duties, which include registering corporations and licensing a variety of professions, as well as overseeing utilities (the Public Service Commission), insurance and banks (the Office of Financial and Insurance Regulation), worker’s compensation and unemployment.
“There won’t be any loss of focus; this is a well-managed department,” he said. He noted that, despite the variety of programs, the department has been consistently first among the agencies to submit its proposed budget to the administration for the past 10 years.
The combination of programs actually lent itself to the creation of the new Michigan One Stop website, he said. The first-in-the-nation system allows any business transactions (licensing, permits, tax payments) to be handled through a single portal.
“Every single contact is tracked so we know where every application is, where every filing is,” he said.
The site also allows users to help each other as well as seeking help from state officials, he said.
He said the new focus on energy did not contribute to recent meltdowns in the state’s unemployment filing system. Rather, he said, that was a combination of underestimating the drops in employment and dealing with old equipment.
He said the agency had been planning on, and preparing for, increased filings and so increased calls and website hits. “We’ve been scrounging the country for parts for the antiquated system we use,” he said.
It just wasn’t enough. One day this week the system handled 25,000 calls, with 12,800 of those getting through to an operator. He said that actually equates to nearly everyone who called getting through, given that some will hang up and call back.
The department now is gearing up for the next su
