Data Center Demand Drives DTE's Five-Year Capex Increase, to $36.5 Billion

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Written by Danny Levin, Deputy Editor for IIR News (Sugar Land, Texas)

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Summary

Buoyed by data center demand, DTE Energy boosted its five-year investment plan 22%, to $36.5 billion. The investment will support a new agreement with Oracle and comes as Industrial Info is tracking $1.85 billion worth of active and proposed projects from DTE, more than 40% of which is attributed to grassroot projects.

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DTE's Data Center-Driven Capital Plan

Detroit, Michigan-based DTE Energy has announced its five-year (2026-2030) capital plan of $36.5 billion, up 22% from $30 billion from the prior plan.

"We increased our 5-year capital investment plan by $6.5 billion compared to the prior plan, driven by investments for the first data center project and the continued need to modernize our utility assets," Joi Harris, the chief executive officer of DTE, said in a quarterly earnings-related conference call on Tuesday. "These additional investments are strategically focused to support data center load growth, advanced cleaner generation, and to enhance distribution infrastructure that will drive continued improvements and reliability."

DTE's net income for fourth-quarter 2025 reached $369 million, up from $292 million year-over-year. Full-year net income of $1.46 billion was roughly flat compared with 2024.

Operating earnings for 2025 were $1.5 billion, up from $1.4 billion in 2024 and at the high end of the company's 2025 guidance. The DTE Electric segment--which focuses on power generation, transmission and distribution--accounted for approximately $1.2 billion ($112 billion higher than 2024.) Chief Financial Officer David Ruud said the main drivers for the increase were "implementation of base rates, weather favorability, lower storm expenses, and higher earnings from our clean energy projects."

Michigan's largest utility, DTE has signed its first hyperscale data center contracts to provide 1.4 gigawatts (GW) of load to power Oracle's new three-building data center in Saline Township being developed by Related Digital. The agreement was already approved by the Michigan Public Service Commission (MPSC). Full construction is expected to begin in the first quarter this year. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can read related project reports.

DTE did not indicate which of its power sites will serve the Oracle project.

The utility expects additional data center opportunities, with another 3 GW of load in late-stage discussions. Harris said another opportunity could reach "final terms" in the coming weeks, "representing significant upside" to the five-year capital plan.

DTE said it is well positioned to support the growing data center buildout, with its renewable generation portfolio accounting for 2,500 megawatts (MW) of capacity online and more capacity under construction and in the planning stages.

DTE's Project Activity

Major projects on track to be completed this year include a $423 million, 220-MW battery energy storage system at a retired coal-fired power plant near Detroit.

Also expected to wrap up by year-end is the conversion of two main coal-fired generation units to burn natural gas at its Belle River Power Station. The new units will provide 1,300 MW of peaking power, which is generated only during peak electricity demand (such as periods of higher-than-average heat or cold) to supplement baseload power. Subscribers to the GMI Power Project Database can read more information on the BESS project and Belle River's natural gas conversions.

DTE said it placed 330 MW of solar projects in service in 2025, with an additional 745 MW under construction.

Projects underway include the 100-MW Cold Creek Solar Park in Coldwater and 132-MW Fish Creek solar plant in Sheridan; see project reports.

Harris said the utility will build around 900 MW of renewables on average per year over the next five years.

Although the federal government is pushing back against renewable-based power generation, DTE is well positioned to weather the storm. The "One Big, Beautiful Bill" accelerates the expiration dates for tax credits related to solar and wind energy, but Harris said the company has been able to safe harbor investment tax credits through 2029 to support its investments.

Subscribers can view a full list of detailed reports for active and proposed projects from DTE.

DTE Addresses Obstacles to Data Center Development

The country's rapid buildout is facing potential obstacles: concerns regarding rising electricity costs and water usage as well as moratoriums on data center development. According to news site Bridge Michigan, there are at least 19 communities in Michigan that have passed or proposed moratoriums on data center development.

DTE's Harris addressed those concerns with a positive outlook, saying: "in all of our discussions with the data centers, we've made it clear that these contracts have to be structured in a way that the revenues fully support their load and cover all the associated costs. So at no time will our customers be burdened with the cost of bringing on new data centers."

"We're encouraging the data center developers to become more engaged at the local level, and that's where we think that, this, the concerns can be best addressed. So we're seeing projects that are making its way through zoning and also site plans, which tells us the right conversations are happening."

Industrial Info is tracking $25 billion worth of active and proposed data center projects throughout Michigan, with nearly all of that amount in the early planning stages. Subscribers can view a full list of detailed project reports.

Key Takeaways

• Data center demand is driving DTE's five-year capital plan of $36.5 billion, up 22% from the prior $30 billion.
• That investment will support the utility's recent agreement with Oracle, while another data center agreement is in late-stage development.
• Renewable generation, especially solar and battery storage, is the company's focus.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resources' Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).