Some Michigan residents would see monthly bills go up nearly 10% under a new DTE Energy Co. rate hike request that the state attorney general has vowed to fight.
DTE’s proposal for a more than $474 million rate hike, comes after state regulators approved a $242 million electric rate increase in February and as consumers grapple with rising costs for gas, groceries, car payments and other expenses.
If approved by the Michigan Public Service Commission, the hike would increase a typical residential customer’s electric bill by about $11.06 per month, or 9.96%, based on 500 kilowatt-hours of usage, according to the request, which DTE filed Tuesday. The new rate could take effect as early as March 1, 2027.
Michigan Attorney General Dana Nessel said this week she will intervene in the case.
“Whether it’s massive half-a-billion-dollar rate hike requests or secret data center contracts, DTE continues to treat Michigan families like an open checkbook to satisfy its shareholders,” Nessel said in a statement.
“As my office scrutinizes this latest filing, I expect to find the same brand of corporate greed we’ve seen every time before, from private jet travel to unsupported costs that do nothing to improve reliability or affordability for Michigan households struggling to keep the lights on,” she added. “We will expose every outlandish cent and demand the MPSC prioritize utility customers over utility corporations.”
The request comes as the utility has pledged not to seek another rate increase for at least two years if a data center planned for Saline Township moves forward as expected. MPSC approval is required for utility rate increases in Michigan. The commission is not expected to decide on the case until February 2027.
DTE, which serves about 2.3 million customers in Michigan, has said the proposed rate increase is needed to fund ongoing investments in the electric system, including upgrades to aging distribution infrastructure, improvements to generation facilities and modernization of information technology and customer service systems.
DTE in a press release last week said the additional rate hike is needed “to support several billion dollars of investment in the electric grid and power generation,” as well as to convert the Belle River Power Plant from coal to natural gas and to build what it says will be the largest standalone battery energy storage facility in Michigan and surrounding states.
“The request reflects DTE’s ongoing commitment to targeted investments that reduce outages, restore power faster when interruptions do occur and ensure reliable and cleaner energy for customers every day,” according to a DTE press release.
In addition to the $474 million base rate increase request, the company is seeking approval for future revenue increases tied to an extension and expansion of its Infrastructure Recovery Mechanism. According to the request, the utility estimates it would need an additional $154 million in 2028, $228 million in 2029 and $318 million in 2030.
In a statement last week, Joi Harris, president and CEO of DTE Energy, said: “As long as the first data center project we’re supporting comes online as planned by the end of 2027 and we’re able to receive other regulatory approvals, we will refrain from filing another rate request until at least 2028.”
Douglas Jester, managing partner of 5 Lakes Energy, a clean energy consulting firm, said the proposed increase amounts to “four years of ordinary inflation.”
“So a two-year pause on a rate hikes when you’re asking for four years’ worth of inflation doesn’t impress me,” he said. “And that’s without regard to whether they have the data centers or not.”
Nessel’s office said DTE issued a “vague and unclear statement purporting the company might abstain from an anticipated 2027 electric rate hike pending approval of this current rate hike, if the controversial Saline Township OpenAI data center comes online with no delay” and if the utility receives what her office called “some other, unnamed” future regulatory approvals related to data center projects within its service territory.
“The good news for DTE’s customers is that DTE is finally reckoning with the anger and exasperation of Michigan households pushed to the brink by DTE and Consumers Energy’s incessant rate hikes,” Nessel said. “I think every business and household would welcome a break from their constant and ever-growing rate hikes, but DTE only offers to skip their next rate hike after approval of their current rate hike case, their largest this decade. DTE only offers a break in rate hikes if they win some other, unnamed data center approvals, and their Saline data center comes online with no delay. This isn’t a commitment, it’s a ransom note.”
Derrell Slaughter, Michigan climate and energy policy director for the Natural Resources Defense Council, also criticized DTE for tying its data center plans to rate requests.
“To dangle the possibility of not filing another rate case because of getting these certain things that need approval, I think that’s the wrong message,” Slaughter said. “We should be pushing for more transparency.”
cwilliams@detroitnews.com
sballentine@detroitnews.com
This article originally appeared on The Detroit News: Nessel says she’ll fight DTE’s latest electric rate hike request
Reporting by Candice Williams and Summer Ballentine, The Detroit News / The Detroit News
USA TODAY Network via Reuters Connect
