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Michigan panel approves electricity rate increase for DTE Energy
LANSING — DTE Energy can increase its electricity rates by $217.4 million this year, which is expected to hike the typical residential bill by about $4.61 per month, the Michigan Public Service Commission ruled Thursday.
The increase, which is not quite half as big as the $456.4 million DTE initially requested in March 2024, is needed to further step up tree trimming and improve the reliability of the system, the three commissioners said in unanimously approving a rate increase that takes effect Feb. 6.
Chairman Dan Scripps said the cost increases approved for the utility giant continue the MPSC’s “obsessive focus” on reducing extended and repeated outages for residential customers, which have provoked loud public outcry in recent years. Scripps said that focus is already paying dividends, as outage numbers and hours dropped significantly in 2024.
Commissioner Katherine Peretick said the MPSC strives to keep rates affordable while ensuring a “robust and reliable” electric grid. “I’m really proud of this progress,” she said.
Paula Silver, a spokeswoman for DTE Energy, said the increase is offset by a recently announced $300 million savings in DTE’s fuel costs and other related electricity transportation costs, which went into effect Nov. 1 and which she said is expected to reduce residential bills by about $5 per month, through 2025. However, those are pass-through costs that can rise and fall periodically based on the costs DTE is required to pay.
“DTE Energy is continuously improving our operations and driving down costs to keep energy affordable,” she said.
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Still, intervenors in the rate case said DTE’s request included “imprudent and unreasonable spending.” The groups, Soulardarity and We Want Green Too, argued in written submissions to the commission that DTE’s return on investment should be limited to 9.18%, not the 9.9% the commission approved.
Michigan Attorney General Dana Nessel argued in an October filing with the MPSC that any increase should be capped at $139.5 million, to reflect what her office calculates as the company’s revenue shortfall to meet customer needs.
The MPSC order includes using the funds in the following ways:
- $87 million toward DTE’s tree trimming “surge” program, bringing the total allocated for that purpose to nearly $500 million since 2019.
- Increased funding for DTE’s portable generators, intended to support the company’s most vulnerable customers, such as those who need to power life-sustaining medical devices, during outages.
- An increase to DTE Electric’s low-income utility bill assistance credit, to $50 a month, up from $40 a month, for enrolled customers whose household income is at or below 150% of the federal poverty level.
- Significant funding to replace breakers, which help recognize and isolate grid interruptions.
- Major upgrades to some of the oldest parts of DTE’s system around Detroit and its suburbs.
- Investments to support electric vehicle charging infrastructure of $12.5 million in 2024 and $5.1 million in 2025.
In a news release, the MPSC said a residential customer using 500 kilowatt hours a month of electricity, which the commission said is typical, will see a 4.65% increase in their monthly bill, or $4.61 per month.
The commission rejected DTE’s request to recover $258,000 in corporate jet travel costs —an expense recently highlighted by the Free Press as one that has been passed on to customers — saying the company did not demonstrate how the expense benefitted ratepayers.
The MPSC also rejected DTE’s bid to recover from rates the cost of certain credits the company is required to pay customers after extended power outages.
But the MPSC also found that DTE’s requests to charge to ratepayers the cost of corporate memberships — another issue highlighted by the Free Press — were “supported in the record and … reasonable.” That’s despite arguments from Soulardarity and others that DTE failed to show how the membership costs benefit customers and that one membership cost in particular, $1.4 million for the Edison Electric Institute, supports work that the group says is actually harmful to the interests of residential customers.
The three commissioners are appointed by Gov. Gretchen Whitmer. Their deliberations on rate increases take place behind closed doors before their decisions are presented at public meetings.
In 2024, the MPSC approved a $368.1 million electricity rate increase for DTE Energy, one that the commission said would result in a $6.51 increase in the average monthly residential bill.
This story has been updated with additional information.
Contact Paul Egan: 517-372-8660 or pegan@freepress.com.
The Michigan Public Service Commission has approved a rate increase for DTE Energy, one of the state’s largest electric utility companies. The rate hike, which will go into effect in the coming months, is expected to raise the average residential customer’s bill by about 4.2%.
The decision to approve the rate increase came after a thorough review of DTE Energy’s request, which cited the need for additional funds to invest in infrastructure improvements and upgrade their grid system. The company has also committed to increasing investment in renewable energy sources and reducing their carbon footprint.
While the rate increase may be unwelcome news for customers, the Public Service Commission assured that it was necessary to ensure the reliability and sustainability of DTE Energy’s services. They also emphasized that the company is subject to regular oversight to prevent excessive rate increases.
Overall, the approval of the rate increase reflects the ongoing challenges facing utilities as they work to modernize their systems and meet the demands of a changing energy landscape. Customers can expect to see the new rates reflected in their bills soon, with DTE Energy promising to continue providing reliable service to all of its customers in Michigan.
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