Landmark Michigan Appellate Decision Upholds Limits on Local Regulation of Renewable Energy Projects

The decision comes on the heels of a similar appellate decision in Illinois upholding another “no more restrictive than” state-level zoning structure. The Michigan decision largely affirms the Michigan Public Service Commission’s (PSC) interpretation of a 2023 state law, effective November 29, 2024, that restructured the local approval process for renewable energy developments. The ruling provides important clarity for local governments and renewable energy developers planning projects. 

Background 

Enacted in 2023, Michigan Public Act 233 (PA 233) transformed siting for solar energy, wind energy, and energy storage systems. The law does not completely eliminate local zoning but shifts authority from local governments to the state by allowing developers to obtain a siting certificate from the PSC if projects meet certain capacity thresholds. 

The law authorizes local governments to continue to regulate siting for qualifying projects only if the local government adopts an ordinance compatible with the new law. In practice, this means that local governments cannot adopt requirements more restrictive than state law standards. If an applicant seeks a certificate from the PSC and meets the statutory criteria, the PSC “shall grant” approval. A certificate from the PSC preempts local siting law, though projects must still comply with local building or operating permit requirements. 

The Lawsuit 

A coalition of 79 townships and counties filed suit, arguing that the PSC’s regulations implementing the new law exceeded its authority by redefining statutory terms, creating a new category of facilities, modifying statutory timelines, and implementing a rule without proper administrative rulemaking procedures. The local governments argued that their own siting ordinances could still include requirements that did not overlap with state law requirements. 

The Court’s Decision 

The court upheld the PSC’s interpretation that local siting ordinances “may only contain the setback, fencing, height, sound, and other applicable requirements expressly outlined in [Michigan Code of Laws 460.1226(8)] and may not contain additional requirements more restrictive than those specifically identified in that section.” The court reasoned that allowing local governments to adopt requirements in addition to those imposed under state law “would inherently be more restrictive,” which would conflict with the legislature’s intent.

Key Takeaways 

• Local ordinances in Michigan cannot exceed state standards. The court affirmed that local governments cannot impose requirements more restrictive than those under state law. If a local government attempts to do so, developers may seek a PSC certificate as an alternative. 

• This is a growing trend. Like Michigan, an Illinois appellate court recently affirmed that a 2023 Illinois law requires counties to approve siting requests for solar projects that meet state law requirements, precluding counties from imposing more restrictive requirements.