Energy optimization program saves dollars for Michigan farms

The Energy Optimization energy efficiency program provides rebates to eligible farmers across Michigan.

The Energy Optimization energy efficiency program provides rebates to eligible farmers across Michigan to better manage their energy use and save money. Energy Conservation Measures (ECMs) are straightforward and rebates are plentiful (see chart). Rebate availability depends on participating utilities (see map) and are updated/modified annually.

Energy Conservation Measure

(restrictions apply)

Low-energy Livestock Waterer


Barn Exhaust Fan

$2 per blade inch

Barn Circulation Fan

$2 per blade inch

Commercial Electric Water Heater for Dairy Milk House


High Performance T8 Fluorescent Lights

$2-20 per fixture

High Bay Light Replacement (i.e., T8 or T5HO linear fluorescent lights)

$20-50 per fixture

CFL bulbs

$1-4 per bulb

LED light bulbs

$8 per lamp

Lighting Occupancy Sensors

$15-30 per sensor

Split system Air Conditioning

$10 per ton

Central Packaged Rooftop AC

$10 per ton

Variable Frequency Drives

$60 per hp up to 40 percent of project cost (limitations apply)

Commercial Refrigeration

Varies. See non-lighting application

Compressed Air

Varies by utility.

Custom Rebates (i.e., irrigation pump speed controls, irrigation pressure reduction, efficient milk harvesting and cooling equipment, dusk to dawn outdoor lights, etc.)

$0.05 per annual kWh saved up to 40 percent
of project cost (limitations apply)

A key aspect of the Utility Energy Optimization program is what is called “custom rebate” options. This means that farmers with a certified farm energy audit who use the custom rebate option get paid per kWh or BTU of calculated savings for each Energy Conservation Measure that is implemented or going to be implemented. The payoff is much larger than the per-piece table values listed above. With a custom rebate option you can use options (proven and available) and you are not limited to the Energy Conservation Measures on the list. To maximize rebates, Michigan State University Extension recommends doing a custom rebate option. It is worth the $500 buy-in required for a certified farm energy audit. Some utility companies even cover the $500 buy-in cost.

The items and rebates listed in the table are usually the same for all utility companies as these items and rates are approved by the Michigan Public Service Commission, however customers need to go to their utility company web page and verify this. For agriculture, most utility companies will allow farms on a “residential” utility rate to avail themselves of the commercial rebates as well. However, farmers need to verify this with their utility company. map

Additional key points about the Energy Optimization program:

For more details about Energy Optimization programs, call 877-296-4319 or visit, or contact Charles Gould at or Al Go at

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