MPSC recommends changes to DTE Electric Co.'s integrated resource plan

FOR IMMEDIATE RELEASE   Feb. 20, 2020

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The Michigan Public Service Commission today recommended substantial changes to DTE Electric Co.’s proposed integrated resource plan (IRP) outlining the utility’s long-term strategy for providing reliable, cost-effective electric service to its customers (Case No. U-20471).

The Commission sent DTE Electric back to the drawing board on its plans for how it would generate electricity over the next 15 years, citing a lack of competitive bidding and other problems identified by stakeholders and MPSC Staff through the IRP process.

These issues inhibited the Commission from assessing the full range of alternatives such as utility- and third party-owned wind and solar projects. The Commission indicated DTE would need to submit a request for proposals (RFP) for new electric generation resources before the IRP could be approved, and set a schedule for filings in this and other cases.

In addition, the Commission recommends that DTE do more with programs to help customers cut energy waste through more efficient appliances, insulation and equipment — programs that are the most cost-effective option to replace aging coal plants and protect the environment.

“The Commission acknowledges DTE’s focus in the near term on ways to increase programs to cut energy waste, but we’re recommending that the utility do more to tap into this cost-effective resource,” MPSC Chairman Sally Talberg said.

In that vein, the Commission called for DTE to reach annual energy savings goals of 1.75 percent in 2020 and 2 percent in 2021, on par with the level approved for Consumers Energy Co. The statutory minimum is 1 percent; DTE had proposed 1.65 percent in 2020 and 1.75 percent in 2021.

The Commission supported two of DTE’s ongoing demand response (DR) pilots but recommended that DTE remove costs associated with other DR pilots proposed by the company. The Commission said it makes more sense for DTE to offer the new pilots in future rate cases or in DR reconciliation cases, where more information about the scope, purpose and costs of the projects will be available on the record.

The Commission also supported, with some changes recommended by MPSC Staff, DTE’s proposal to conduct a conservation voltage reduction/volt-var optimization pilot program to help determine the components needed for a permanent program. Volt-var optimization controls electrical equipment to maintain customer voltage levels in the lower portion of the allowable voltage ranges, thereby cutting energy waste.

The Commission also found that DTE’s plans to not to retire the coal-fired Belle River power plant until 2029-2030 were inadequately justified because an analysis of avoiding new environmental upgrade costs was not considered. The Commission indicated it would scrutinize such costs in rate proceedings until a new cost-benefit analysis with earlier retirements dates could be analyzed in DTE’s next IRP.

Parties have until March 6, 2020, to file comments in response to the Commission’s recommendations. DTE may submit a revised IRP by March 21, 2020.

The Commission set a date of April 1, 2020, for DTE to update its renewable energy plan case; Nov. 13, 2020, for review of capacity need and avoided costs under the federal Public Utility Regulatory Policies Act, and Sept. 1, 2023, for its next IRP.

The MPSC took thousands of public comments in the course of proceedings in the case. Input also included a public hearing in Detroit in summer 2019, attended by upwards of 150 people, and six days of cross examination of expert witnesses.

“We appreciate the unprecedented amount of public participation generated by the interest in this case, a clear indication that Michiganders are becoming more engaged in helping to shape Michigan’s energy future,” Talberg said.

Intervenors in the case included the Michigan Attorney General’s Office; the Association of Businesses Advocating Tariff Equity; Energy Michigan, Inc.; Environmental Law and Policy Center/Ecology Center/Solar Energy Industries Association/Union of Concerned Scientists/Vote Solar; Great Lakes Renewable Energy Association; Michigan Energy Innovation Business Council/Institute for Energy Innovation; Michigan Environmental Council/Natural Resources Defense Council/Sierra Club; City of Ann Arbor; Geronimo Energy; Soulardarity; ITC Transmission Co.; Cypress Creek Renewables; Convergen Energy; Midland Cogeneration Venture LP; Heelstone Development; Michigan Public Power Agency, and MPSC Staff.

To look up cases from today’s meeting, access the E-Dockets filing system here.

To watch a livestream of the MPSC’s meetings, click here.

For information about the MPSC, visit www.Michigan.gov/MPSC, sign up for one of its listservs, or follow the Commission on Twitter.

DISCLAIMER: This document was prepared to aid the public’s understanding of certain matters before the Commission and is not intended to modify, supplement, or be a substitute for the Commission’s orders. The Commission’s orders are the official action of the Commission.

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