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Should DTE Energy be allowed to increase your electric rates?

Posted at 7:32 AM, Jan 21, 2022
and last updated 2022-01-21 07:32:48-05

LANSING, Mich. (WXYZ) — DTE Energy is asking to raise your power rates. It is planning to turn in a proposal for a 388 million dollar investment into Michigan’s energy grid, paid for by customers to the Michigan Public Service Commission on Friday.

Is it too much? What is it for? Will it pass?

7 Action News Reporter Kim Russell spoke to Trevor Lauer, President of DTE Energy Electric Company, asking what the money was needed for.

“I will bucket it in two areas Kim. The first is reliability. Based on the summer storms that we saw this past year we need to continue to improve the reliability of our grid, specifically when we have these high wind events coming in, and secondly, we need to continue on clean energy,” said Lauer.

Lauer says climate change is hitting its Michigan customers with more extreme wind events. As this document presented to investors this month shows at the same time Electric Vehicles are expected to increase demand on the grid:

DTE Business Update 1.10.22 by WXYZ-TV Channel 7 Detroit on Scribd

“We are investing for electrification. We have new substations going in. We have new transformers. New wire,” said Lauer.

“I am actually surprised they are not asking for more,” said Dr. Chris Kobus, Founding Director of Oakland University Clean Energy Research Center.

Dr. Kobus says the transition to clean energy requires investment. He teaches people how to save on energy costs. He says the cost of energy is so cheap, it is hard to motivate people to save energy.

“So cheap that people don’t know how much they are using and they probably don’t know the units,” said Kobus.

“At the same time, DTE has recorded record profits, far exceeding most other public utilities in the country. It is more than $1.4 billion in 2020,” said Bob Allison, Deputy Director of the Michigan League of Conservation Voters.

Allison pointed to research that shows Michigan rates are higher than they are in other Midwest states from the federal government.

“The 17.7 cents per kilowatt-hour (kWh) that Detroit area households paid for electricity in November 2021 was 24.6 percent more than the nationwide average cost of 14.2 cents per kWh. In the prior four years in November where data were available, Detroit area electricity costs exceeded the national average, ranging from 11.9 percent to 27.2 percent more,” says a report compiled by the U.S. Bureau of Labor Statistics.

Allison says the fact that DTE is promoting to investors that it is delivering them a return above industry-standard raises the question. Are consumers paying too much?

“We need to understand, where is all the money going, and more importantly, why are we being asked as small business owners and residents to pay more?” asked Allison.

“I think it is a balanced approach,” said Lauer. “We need to invest in the grid. We need to make sure the customers have reliable service. We need to decarbonize the energy we provide our customers. And we need to be a successful company because that is how you finance the work we are doing for our customers.”

The Michigan Public Service Commission will hold hearings and hear from the public before making a decision. DTE customers and others interested in the rate increase request may participate by submitting comments or speaking at public meetings. The public may submit comments by email to mpscedockets@michigan.gov. The comments should reference Case No. U-20836.