The federal government is providing a $1.6 billion loan to DTE Energy to modernize its natural gas infrastructure across Michigan. The loan, announced Monday, is expected to result in more than $700 million in savings for Michigan customers, officials said.
The Department of Energy’s Office of Energy Dominance Financing closed the loan, which was made possible by President Donald Trump’s Working Families Tax Cut, officials said.
“This loan to DTE Gas will lower energy costs, create jobs and increase grid reliability for the people of Michigan,” U.S. Energy Secretary Chris Wright said in a release Monday.
The loan is expected to fund DTE’s upgrades of about 800 miles of natural gas pipeline and rebuild a compressor station. DTE says the investment will allow it to store more gas during low-demand periods, helping them better respond to peak demand.
The loan is expected to result in a direct savings for customers over time, said Dan Miner, director of corporate and executive communications for DTE.
“We would ask the Michigan Public Service Commission for lower customer rates than we otherwise would have if we didn’t get this loan,” he said.
The expected customer savings was calculated based on reduced interest expenses over the 30-year life of the loan, Miner said.
In November, DTE Energy filed a request with the MPSC seeking an overall 10% rate hike for gas customers, including at least an 8% increase for residential users. In March, Michigan Attorney General Dana Nessel said she would seek to slash that request by 85%.
cwilliams@detroitnews.com
This article originally appeared on The Detroit News: DTE getting $1.6 billion loan from feds to update gas infrastructure
Reporting by Candice Williams, The Detroit News / The Detroit News
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By Candice Williams, The Detroit News | USA TODAY Network
