Michigan OKs $952M cost recovery for DTE gas plant
The Michigan Public Service Commission (MPSC) on Friday approved DTE Energy's proposal to recoup nearly $1 billion for a 1.1 GW gas-fired power plant in East China Township, Mich. Construction is slated to begin next year, though opponents say they may appeal the decision.
The gas plant is scheduled to begin operating in 2022, offsetting the scheduled retirement of three coal-fired plants in River Rouge, St. Clair and Trenton Channel. MPSC Chair Sally Talberg said the gas plant combined reliability and cost effectiveness, but opponents of the proposal said it continues the state's over-reliance on fossil fuels.
Last month, DTE announced a plan to double its renewable energy capacity by 2022, primarily through wind power. Two wind parks, slated to become DTE's largest wind resources, will come online in the next two years, providing 330 MW of capacity.
But the company's moves to bolster renewables have not been enough to placate opposition to the gas plant. Reaction was swift, following MPSC's approval of what the Associated Press noted as the first major facility to be approved for a regulated utility in Michigan in decades.
In statements, Vote Solar called it an "unfortunate ruling;" the Union of Concerned Scientists said it is "extremely disappointed;" and Sierra Club called it a "costly mistake for Michigan customers."
DTE Electric President and COO Trevor Lauer said in a statement that "today’s decision is one aspect of the bigger picture ... serving as a critical piece to the success of providing reliable, affordable, cleaner energy to all our customers in Michigan."
Lauer noted that the utility has already driven more than $2 billion in renewable energy investments, and operates 13 utility-scale wind farms and 31 solar parks.
DTE ran more than 60 different scenarios and they all pointed to the gas plant being best for customers, "in addition to demand response, renewables and energy efficiency," Lauer told Utility Dive in an interview.
"We're doing all of them, not one," Lauer said. "We are overwhelmingly in support of energy efficiency and renewables. We are blessed in Michigan with a 24-7 manufacturing economy, and having a gas plant complement the additional renewables we are building for our customers allows us to have a reliable, affordable and clean power supply going forward."
Regina Strong, Michigan Director of Sierra Club's Beyond Coal Campaign, said in a statement that “we certainly hope that in its upcoming Integrated Resource Plan, DTE will listen to the communities, experts, and advocates and put itself on a clean energy path."
Opponents of the gas plant say solar, wind, energy efficiency, demand response and storage would be cheaper and could save customers $300 million to $1.1 billion. And a BW Research Partnership report concluded clean energy investment would deliver ten times more jobs than the gas plant.
Friday's approval is unlikely to be the end of the debate.
"We will be closely reading the order and discussing all options, including appeal, moving forward," Margrethe Kearney, senior attorney with the Environmental Law & Policy Center, said in a statement.
- Detroit Metro Times State commission: DTE Energy can build $1 billion gas plant — and pass cost on to you
- Utility Dive DTE Energy proposes 1,100 MW gas plant in Michigan
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