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Michigan commission approves $217 million electricity rate hike for DTE Energy

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(CBS DETROIT) - The Michigan Public Service Commission approved a $217.4 million electricity rate hike for DTE Energy on Thursday.

The approval comes more than a year after MPSC granted DTE a $368 million increase in December 2023.

With the rate hike, DTE customers using 500 kWh can expect to see a $4.61, or 4.65%, increase, according to a news release. The increase will go into effect on Feb. 6.

MPSC approved 48% of DTE's original increase request. 

"Our customers demand and deserve reliable energy," DTE said in a statement. "DTE Energy is continuously improving our operations and driving down costs to keep energy affordable. Combined with DTE's recent customer monthly bill reduction in the power supply cost recovery factor (PSCR), today's order from the Michigan Public Service Commission means residential electric customers will not experience an increase in their monthly bills."

In November 2024, DTE reduced its PSCR, which represents the cost of fuel and other sources the utility uses to produce electricity, by $300 million. This reduced customer bills by about $5 per month, on average, through 2025, which DTE says will offset the $4.61 rate increase that the MPSC approved. 

The commission approved several requests by DTE, including: 

  • An increase of $87 million toward DTE Electric's ongoing tree-trimming surge program, to increase the frequency of tree trimming and other vegetation management around power lines. 
  • Costs for DTE Electric's breaker replacement program. 
  • DTE Electric's projections relating to its pole and pole top maintenance and modernization program.
  • Costs relating to areas in and near downtown Detroit, including Highland Park, that face challenges with poor reliability because of aged equipment, lack of space for new equipment, and high failure rates. 
  • Increasing DTE Electric's low-income utility bill assistance credit from $40 to $50 a month.
  • Electric vehicle investments to support charging infrastructure, including $12.5 million in capital expenses for DTE Electric's Charging Forward program in 2024 and $5.1 million in 2025.
  • Costs for the utility's portable generator program, which provides generators to the most vulnerable customers during widespread outages, helping power refrigerators and freezers, preventing the loss of food and medicine, powering critical-care medical devices and more.

The MPSC rejected several expenses DTE sought, including $258,000 in corporate jet travel the company was looking to recover from ratepayers, saying "the company did not demonstrate how the expense benefitted ratepayers." The commission also denied the utility's request to recover the cost of customer power outage credits caused by public interference like car crashes, contact with animals or ice, wind and lightning. The MPSC said it was DTE's responsibility to ensure its grid could withstand these events. 

The commission also continued the current authorized rate of return on common equity of 9.9%, rejecting DTE's proposed increase to 10.5%. 

Michigan Attorney General Dana Nessel issued the following statement:

"This case was filed immediately after DTE received approval from the Commission for a staggering $368 million annual rate increase. Combined with this latest rate hike, DTE has obtained approval to rake in nearly $600 million in additional annual revenue from ratepayers in just 14 months. While I applaud my team's tireless efforts in saving DTE customers over $500 million during this time, I remain deeply concerned about the relentless pace and magnitude of these enormous rate increases. More work must be done to limit DTE's unsustainable rate growth at the expense of ratepayers while improving customer reliability. My office will continue to stand up for Michigan consumers and fight these incessant rate hikes." 

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