Are rate hikes the only option for improving the power grid?

Posted at 3:05 PM, Mar 17, 2023
and last updated 2023-03-17 18:37:29-04

OAK PARK, Mich. (WXYZ) — A grandma from Oak Park noticed trees growing into wires. She said after the recent outages, we all need to be reporting such problems — and for her, it's personal.

"This is my house. A neighbor took these. I wasn’t taking pictures while my house was burning," Edith Lee Payne said while showing us photos of her house on fire.

Payne used to live in a house in Detroit. Then a July 2003 storm knocked over a tree onto a power line.

"I started smelling smoke. It was an electrical fire, devastating fire," she said.

She sued, but says DTE Energy argued due to the storm’s powerful winds, it wasn’t their fault.

While she didn’t win a judgement in court, a fire investigator's report says a short circuit caused the fire. She says her story shows the dangers of a weak power grid — and now, she sees weaknesses everywhere. She showed Seven Action News problem areas, where trees are growing into power lines.

She testified during a State House Energy committee before DTE leaders this week, calling for action to expedite updating the grid and removing trees.

The meeting comes in response to recent power outages.

"We have a plan. We need to invest in that plan and work with all stakeholders to increase the investment that is going into our grid," said President and COO of the Electric company at DTE Energy Trevor Lauer.

Lauer told the House Committee DTE has a 15-year long plan to improve infrastructure.

To put his call for increasing investment into context, the company has asked the Michigan Public Service Commission for a rate hike to fund the improvements.

It is a request being criticized by many customers who point to investor profits.

DTE says investment ratings allow it access to low cost loans for infrastructure improvements.

We wanted to know: are higher rates the only option?

"If it does not come from rate hikes, we could spend our tax dollars from the state," professor Douglas Carr said.

Carr is director of the Master of Public Administration program at Oakland University.

He says the challenge is that as a public company, DTE may be incentivized to delay investments for accounting purposes as it manages depreciation of new infrastructure.

"If you have a piece of equipment that you put it into service, when you put it into service, your accounting is going to require you set aside money for what is used up," he said.

This is a process that ensures there is money in the future to fund replacements.

"This is the first time an audit has been conducted in Michigan," said Michigan Public Service Commissioner Katherine Peretick.

Peretick says the MPSC plans to use an independent audit looking at infrastructure, operations and maintenance at power companies to look for ways to improve service. The goal is to hold companies accountable as it decides whether or how much to increase rates. 

Payne says she is interested in seeing what that audit finds. But in the meantime, she is doing her own audit of a kind: reporting trees in lines.

She says learn from her loss.

If you see trees growing into a power line on a utility company’s easement, let them know.

DTE Energy provided a statement saying:

"Two-thirds of the time DTE customers spend without power is due to tree-related issues. Last year DTE trimmed more than 6,500 miles of trees along its service lines. Customers can submit a tree trim inquiry on our website ( []). There you will find a quick form where customers enter basic information, explain the situation, and submit photos.

Over the past five years, DTE has invested over $5 billion in our electrical grid, trimming trees, hardening infrastructure, replacing aging equipment including cable, breakers and switchgear, building new substations, and connecting customers. These customer-focused investments are yielding results, but to see dramatically improved performance, we must go faster to outpace the rate at which we are experiencing historically severe weather.

Last year alone, we trimmed more than 6,500 miles of trees and worked on more than 8,500 circuit miles."