DTE Electric Wants to Exit Coal Sooner Than Planned, Grow Clean Energy Faster

Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--DTE Electric Company, a unit of DTE Energy Company (NYSE:DTE) (Detroit, Michigan), plans to spend about $9 billion over the next decade to build clean electric generation, assuming Michigan utility regulators approve an integrated resource plan (IRP) filed by the utility on November 3.

Specifically, DTE Electric asked regulators for approval to add about 4,400 megawatts (MW) of solar generation, 1,000 MW of wind generation, and 760 MW of battery energy storage over the next 10 years.

DTE Electric's proposed $9 billion spend over the next decade will create or retain more than 25,000 Michigan jobs, supporting the state's economy while accelerating its planned reductions of carbon dioxide (CO2) emissions and maintaining reliable electric reliability, the utility said in its IRP filing. If the regulators approve the plan, DTE said it would be able to decarbonize its electric supply faster, reducing CO2 emissions by 65% in 2028, 85% in 2035, 90% by 2040, and reach net-zero emissions by 2050.

Those potential investments in clean generation, as significant as they are, are only a down payment on DTE Electric's longer-term objective of adding 6,500 MW of solar, 8,900 MW of wind and 1,810 MW of battery storage by 2042, according to the IRP. The utility said it expected to add these resources mainly through requests for proposals (RFPs).

The utility's preferred resource plan also would include converting the baseload coal-fired Belle River Power Station to become a peaking plant that burns natural gas by the middle of this decade, then closing the facility by 2040. DTE Electric also wants to retire units 3 and 4 of the coal-fired Monroe Power Station, totaling about 1,535 MW, in 2028, 12 years ahead of schedule. Units 1 and 2 of that facility, totaling about 1,531 MW of capacity, would be retired in 2035, five years ahead of schedule. That would complete the utility's exit from coal-fired power.

When Monroe units 1 and 2 are retired in the middle of the next decade, DTE Electric said it plans to replace that retired generation with a 946-MW combined cycle gas-fired generator equipped with carbon capture & sequestration. It noted that "low- and zero-carbon dispatchable technologies ... are still emerging and require further development." So the proposed gas-fired generation is something of a placeholder that may be replaced by other types of non-emitting generation like small modular nuclear reactors (SMRs), should they mature and become cost effective.

Adoption of this plan would lead to a $1.4 billion reduction in future costs compared to the utility's 2019 IRP, DTE Electric estimated, citing expected reductions in fuel costs and transmission projects.

Industrial Info is tracking 23 active DTE Energy projects valued at about $1.15 billion. The majority of that planned spend will go to environmental remediation at the coal-fired Belle River and Monroe power stations--specifically, actions to meet federal requirements on coal combustion residuals (CCR) and decommissioning & dismantling coal-fired generators.

The utility's prior IRP, approved in 2020 by the Michigan Public Service Commission (MPSC) (Lansing, Michigan), accelerated the retirement of three coal-fired power plants (River Rouge, Trenton Channel, and St. Clair), increased renewable generation, gas-fired generation, and boosted the DTE's customer programs to increase the efficiency with which customers use electricity. This year's IRP continues and accelerates the moves from the earlier plan.

In testimony supporting the IRP, Joyce Leslie, DTE Electric's director of business planning and development, said the preferred plan "ensures electric reliability, resource diversity and flexibility to mitigate risks facing the energy industry." This plan "allows DTE Electric to time affordable, cost-competitive solar and energy storage projects early in the planning period in advance of initiating Monroe's phased retirement."

The plan as filed envisions taking advantage of tax credits in the federal Inflation Reduction Act of 2022, which would allow the utility to accelerate its plan to decarbonize its electricity supply while also saving consumers money.

Michigan regulators are scheduled to review the plan in 2023 and make a decision next year.

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