What Michigan’s fast changing energy laws mean for solar customers, communities, and developers this year
Michigan’s solar policy landscape in 2025 is busy. The state is implementing a 100 percent clean energy law, rewriting the rules for where big solar can be built, expanding rooftop solar caps, and sending millions of dollars to host communities.
If you live in Michigan or work in the solar industry here, this is the year a lot of those 2023 laws move from legislative talking points to real-world impacts on rates, siting, and project pipelines.
The clean energy law is now driving utility planning, not just headlines
In 2023, Michigan adopted the Clean Energy Future package, headlined by Public Act 235. It requires utilities to reach 60 percent renewable energy by 2035, while a separate clean energy standard pushes the grid to 100 percent clean electricity by 2040. Michigan.gov+2climatepolicydashboard.org+2
The Michigan Public Service Commission (MPSC) confirmed in its 2025 Status of Renewable Energy, Distributed Generation, and Legacy Net Metering report that utilities must maintain at least 15 percent renewables through 2029, jump to 50 percent from 2030 to 2034, and hit 60 percent in 2035. Michigan.gov+1
According to an October 2025 MPSC spotlight, utilities had more than 7,500 megawatts of renewable capacity online at the end of 2024, with more than 8,300 megawatts expected by the end of 2025 based on already approved contracts. GovDelivery That scale of buildout by itself is a strong driver for more utility-scale solar and storage across the state.
For residential and commercial customers, these targets are the backdrop for everything else in this update. They shape integrated resource plans, rate cases, and which solar or storage projects utilities prioritize over the next decade.
Rooftop solar gets more room to grow with a bigger Distributed Generation cap
For years, Michigan rooftop solar was constrained by a 1 percent cap on utility distributed generation programs. Public Act 235 increased that cap to 10 percent of each utility’s average in-state peak load over the previous five years and set clear allocations for different system sizes. Michigan Legislature+2GLREA+2
The MPSC’s October 2025 report shows that distributed generation capacity climbed from 189.6 megawatts in 2023 to 222.4 megawatts in 2024, a jump of more than 17 percent in a single year. Michigan.gov The number of customers participating has also grown steadily since 2022 as more homeowners and businesses install solar. Michigan.gov
Program rules for new rooftop projects are now clearly laid out on the MPSC’s Distributed Generation page. Residential and small commercial systems can be up to 550 kilowatts, sized to roughly 110 percent of annual usage, and must follow standardized interconnection rules. Michigan.gov Electric providers still credit exports using an outflow rate that reflects avoided power supply costs rather than traditional one-to-one net metering, but implementation of Public Act 235 allows generation credits to offset more line items on the bill for at least some customers. Consumers Energy+1
For Michigan Solar Partners customers, the bottom line in 2025 is that there is much more headroom before utilities hit their distributed generation cap, and the policy framework is more stable for projects that may take months to plan, permit, and build.
Community solar moves to the front burner in Lansing
Michigan still does not have a robust statewide community solar program, but 2025 could be the year that changes. A bipartisan group of lawmakers introduced Senate Bills 518 and 519 to establish a community solar framework and direct the MPSC to write detailed rules. Coalition for Community Solar Access+1
Companion legislation in the House, including House Bill 4590, would require the Commission to set up rules for community solar facilities under the state’s existing renewable energy law. Michigan Legislature If passed and implemented, these bills would create new options for renters, low income households, schools, and small businesses to subscribe to local solar projects and receive bill credits without installing panels on their own roofs. Coalition for Community Solar Access+1
For developers, community solar legislation would open a new mid scale market segment between small rooftop projects and very large utility scale arrays. For local governments and host landowners, it could offer more flexible ways to participate in solar development while keeping projects community sized.
Utility scale solar siting is shifting from township halls to the MPSC
One of the biggest structural changes in Michigan energy law is Public Act 233 of 2023, the renewable energy and storage facility siting law. It took effect on November 29, 2024, and 2025 has been the first full year of implementation. Michigan.gov+1
Under PA 233, the MPSC gains siting authority for utility scale solar, wind, and energy storage projects if affected local governments do not adopt a Compatible Renewable Energy Ordinance that meets state standards on things like setbacks and timelines. Michigan.gov+2Michigan Legislature+2 The Commission spent much of 2024 and early 2025 conducting public engagement and issuing orders that define how developers apply and how local input is handled. Michigan.gov+2MIEIBC+2
In 2025, counties and townships have been scrambling to update or write solar ordinances that stay compatible with state law while reflecting local priorities. For example, Huron County is revisiting its solar acreage cap and looking at host community payment formulas that align with PA 233, while Big Rapids Township has formed a committee to develop wind and solar ordinances that keep local permitting authority. Huron Daily Tribune+1
For landowners and developers, this adds some front end complexity but also offers more certainty. Projects that cannot get a fair hearing locally now have a clear path to the MPSC, while communities that want to keep permitting authority can do so by adopting ordinances that meet the state’s minimum requirements.
Host communities are seeing real dollars through Renewables Ready grants
Michigan’s siting law does more than centralize permits. It was paired with new financial support for communities that host large renewable energy and storage projects. The Department of Environment, Great Lakes, and Energy (EGLE) created the Renewables Ready Communities Award program, a 30 million dollar fund that pays local governments per megawatt of capacity. Michigan.gov
By early 2025, EGLE had already completed three funding rounds, including nearly 5 million dollars in January 2025 to support enough solar and storage to power more than 975,000 Michigan households. GovDelivery In June 2025, the agency announced another 3.67 million dollars in awards to six communities hosting projects, and a September 2025 press release added 1.85 million dollars more. Michigan.gov+1
Real projects are benefiting. Meade Township and Colfax Township in Huron County received more than 2.2 million dollars combined to support DTE’s Silver Creek Solar Park and the Century Oaks battery storage project, bringing road upgrades, public safety improvements, and other local infrastructure along with clean energy development. Huron Daily Tribune+2Huron Daily Tribune+2
For local officials evaluating future solar proposals, these grants are becoming a key part of the conversation. Host communities are not just weighing land use impacts, they also have a concrete way to secure benefits like road repair, park upgrades, and emergency services improvements.
MISO queue reforms shape the timeline for big solar in Michigan
Behind the scenes, grid operators are trying to unclog the interconnection pipeline that feeds new solar onto the transmission system. Michigan sits in MISO’s territory, and reforms to MISO’s generator interconnection process are increasingly important for developers looking to bring utility scale solar online before 2030. MISO Energy+1
MISO’s Generator Interconnection Queue Improvements initiative, tracked as PAC 2023 1, aims to keep future queue cycles smaller and deliver faster, more predictable study results. MISO Energy A September 2025 update reported that 100 generator interconnection agreements totaling about 17 gigawatts of capacity were processed between November 2024 and August 2025, indicating that reforms are starting to move projects forward. MISO Energy
As of fall 2025, independent trackers show hundreds of solar projects in the MISO queue, many of them in or near Michigan. Cleanview Exactly which ones get built will depend on transmission upgrades, utility resource plans, and project economics, but the volume suggests that Michigan’s 2030 and 2035 clean energy targets are technically feasible if interconnection timelines keep improving.
For Michigan Solar Partners and other developers, a smoother MISO interconnection process reduces one of the biggest uncertainties for large solar and storage projects connecting at transmission level.
What all of this means for Michigan solar buyers in 2025
Homeowners and small businesses
If you are considering rooftop solar, 2025 is a better policy year than the previous decade. The distributed generation cap is much higher, the program rules are clearer, and the state’s long term clean energy targets create a strong signal that solar will remain a central part of the grid mix. You still need to pay attention to your utility’s specific export credit rate and interconnection process, but the risk that the program suddenly fills up has been reduced. Michigan.gov+3Michigan.gov+3Michigan.gov+3
Large energy users and C&I customers
For manufacturers, universities, big box retailers, and other large loads, the combination of more utility scale solar, potential community solar offerings, and improving interconnection timelines makes 2025 a strategic time to revisit on-site solar, power purchase agreements, or green tariff options. The policy trend line points strongly toward more renewables and more storage, which can be used to hedge long term power costs. MISO Energy+3Michigan.gov+3GovDelivery+3
Landowners and rural communities
If you own land in areas targeted for utility scale solar, you are now operating in a new world where local ordinances and state level siting rules must fit together. Compatible Renewable Energy Ordinances can keep more decision making local, but the MPSC is now a backstop if projects stall. At the same time, EGLE’s Renewables Ready grants are bringing real money into host communities that choose to participate. Huron Daily Tribune+4Michigan.gov+4Graham Sustainability Institute+4
Developers and installers
For developers, the message in 2025 is to align early with both state requirements and local expectations, and to track MISO queue opportunities closely. For installers, especially those focused on rooftop and small commercial projects, the expanded distributed generation cap and strong year over year growth in installed capacity signal a robust market that is still far from saturated. GLREA+2Michigan.gov+2
Sources
https://www.michigan.gov/mpsc/commission/workgroups/2023-energy-legislation Michigan.gov
https://www.michigan.gov/mpsc/commission/news-releases/2025/10/08/mpsc-renewable-energy-distributed-generation-legacy-net-metering-report Michigan.gov
https://www.michigan.gov/mpsc/-/media/Project/Websites/mpsc/regulatory/reports/RE-DG/2025-RE-DG.pdf Michigan.gov+1
https://www.michigan.gov/mpsc/regulatory/facility-siting/renewable-energy-and-storage-facility-siting Michigan.gov+1
https://www.legislature.mi.gov/documents/2023-2024/publicact/htm/2023-PA-0233.htm Michigan Legislature+1
https://www.michigan.gov/egle/about/organization/materials-management/energy/rfps-loans/renewables-ready-communities-award Michigan.gov+3Michigan.gov+3GovDelivery+3
https://communitysolaraccess.org/news/bipartisan-bills-introduced-to-expand-community-solar-access-in-michigan Coalition for Community Solar Access+2MIEIBC+2
https://www.misoenergy.org/planning/resource-utilization/generator-interconnection/ Cleanview+4MISO Energy+4MISO Energy+4
