Is Consumers Energy's carbon reduction plan better than DTE Energy's? Environmentalists say yes | Michigan Radio
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Is Consumers Energy's carbon reduction plan better than DTE Energy's? Environmentalists say yes

May 20, 2019

In 2016, Michigan got an important new tool in the growing effort to limit global heating.

The state's new energy law requires regulated utilities, for the first time, to submit long-term strategic plans that include reducing carbon emissions.   

The plans are called Integrated Resource Plans, or IRPs.

Consumers Energy and DTE Energy have now submitted their first IRPs, and the plans show that Michigan's two biggest utilities differ on how aggressively to cut carbon emissions.

One utility plans to maximize zero carbon sources, and minimize natural gas

"Our Clean Energy Plan is going to deliver a 92% reduction in our carbon emissions by the year 2040," says Brandon Hofmeister, Consumers Energy's Vice President of Governmental, Regulatory and Public Affairs.

Hofmeister says the utility will shut down its last coal-burning plant by 2040. And there will be no new natural gas plants.  

The utility will replace those fossil fuels with all zero carbon sources of energy. Or, in the case of energy efficiency and demand response, reducing the need to produce electricity at all.

So customers will see more rebates in the years ahead to encourage them to invest in home insulation and energy efficient appliances.

They'll also see more "demand response," which encourages (or requires) customers to lower their electricity use when the electric grid is having trouble meeting the demand.

Another big source will be solar energy.

"Solar is going to play a huge role in the future of Consumers Energy's electric generation supply in the future," says Hofmeister. "We'll build about 5,000 megawatts of solar in Michigan by around 2030, and about 6,000 by 2040."

Hofmeister says getting all the way to 100% zero carbon is going to be tough, though, and will likely require new technologies that are not economical or available today.

Less reliance on renewables and more on natural gas

DTE Energy is taking a dramatically different approach to renewable energy in its first IRP compared to 

Construction site of DTE's 1,100 MW natural gas facility in East China Township.
Credit DTE Energy

Consumers.

Like Consumers, it will shut down its last coal-burning plant by 2040.  

But instead of firm commitments to adding more and more renewables, DTE Energy is offering a number of different scenarios, or "pathways," that include using the MI Green Power program to drive demand for renewables.

That program allows customers to pay extra to have some or all of their energy coming from wind, or wind plus solar. As enrollment in the program increases,  DTE will add more renewable energy capacity.  

That difference in approach could put the utility on a slower path to boosting its renewable energy capacity. Charlotte Jameson of the Michigan Environmental Council says it appears DTE Energy plans to have about a third of the solar that Consumers Energy will have by 2040.

DTE Energy's IRP also envisions a smaller role for energy efficiency and demand response programs.

And this is a big difference: it plans to rely more on natural gas with its new natural gas generating plant.  The utility says it may add a second one in the future as well.    

A prudent decision, or a risky bet?

Construction on DTE's new 1,100 megawatt natural gas plant is already underway.  

Irene Dimitry is Vice President of Business Planning and Development for DTE Energy.  She says that new plant is necessary, and not just for DTE customers.  She says it will provide power whenever it's needed to keep the larger Midwest energy grid stable. 

"It's a very flexible plant that's able to ramp up quickly, when the sun stops shining and the wind stops blowing," says Dimitry.

That will become more important as other utilities rely more heavily on renewable energy, she says.

But Dan Bakal thinks the decision to build the plant is actually pretty risky. He's with sustainability think tank Ceres.  

"I think if you look closely at the issue of climate change and the pace of decarbonization that's going to be required, it is very likely that a natural gas plant built today will not remain for its useful life," says Bakal.

Margrethe Kearney of the Environmental Law and Policy Center agrees, and says the IRP submited by DTE Energy makes the utility look stuck in the past.

She says Consumers Energy's plan is bolder. 

"One of the things that differentiates Consumers as a company, I really think, is that they looked at the world, and they recognized: it's changing," says Kearney. "And we're a company, and we have shareholders and we want to make money, but we need to figure out how to do that in a changing world, instead of holding onto the old way of doing business."

Still, Irene Dimitry of DTE Energy says the utility's proposal is realistic based on conditions today. She says the plan will be revised every five years.

"If we can do more quicker, we will, but it's really hard for anybody to say exactly what will happen by 2050; these are all long-term forecasts," she says.

Why it could matter... especially for DTE Energy customers

Environmental groups say they can't just ask the Michigan Public Service Commission to pull the plug on the natural gas plant.

The Commission approved it just months before the state's new energy law requiring IRPs went into effect.

So even as DTE Energy plans to be running at least one, if not two, natural gas plants after 2050, leading climate scientists say we need to reach net zero carbon emissions by then.   That means burning no fossil fuels - or capturing all the carbon that they emit when burned, and storing it somewhere.

Critics say DTE could end up in a last minute and costly rush to catch up to utilities that have done more, sooner.

Meanwhile, the Michigan Public Service Commission is scheduled to decide on whether to approve Consumers Energy's IRP in a few weeks. 

Next, the process for evaluating DTE Energy's IRP begins.

Environmental groups say they'll be urging the Commission to demand significant changes to the plan, or to reject it altogether and send DTE back to the drawing board.

Editor's note: DTE Energy and Consumers Energy are corporate sponsors of Michigan Radio.