Michigan Approves $217M DTE Energy Rate Hike Amid Outage Concerns

LANSING, Mich. — The Michigan Public Service Commission (MPSC) approved a $217.4 million rate increase for DTE Energy on Thursday, allowing the utility to raise electricity rates starting Feb. 6. The decision will result in a $4.61 monthly increase for the average residential customer using 500 kilowatt-hours of electricity.

The approved hike is less than half of the $456.4 million DTE initially requested in March 2024. The funds will be used to enhance tree trimming efforts, upgrade aging power lines, and improve system reliability, particularly in Detroit and its suburbs, which have some of the oldest infrastructure in DTE’s grid.

“This decision reflects our obsessive focus on reducing outages and improving reliability for customers,” said MPSC Chairman Dan Scripps. He noted that outage numbers and durations have already decreased significantly in 2024, attributing the progress to recent infrastructure investments.

DTE Energy spokesperson Paula Silver emphasized that the rate increase is partially offset by a $300 million reduction in fuel and transportation costs, which took effect Nov. 1 and is expected to lower residential bills by about $5 per month through 2025. “DTE Energy is continuously improving our operations and driving down costs to keep energy affordable,” Silver said.

However, critics argue the utility’s spending is excessive. Michigan Attorney General Dana Nessel recommended capping the increase at $139.5 million, citing calculations of DTE’s revenue shortfall. Advocacy groups Soulardarity and We Want Green Too also contested the hike, arguing that DTE’s return on investment should be limited to 9.18%, not the 9.9% approved by the commission.

The MPSC rejected several of DTE’s requests, including $258,000 in corporate jet travel costs and recovery of outage-related customer credits. However, the commission approved corporate membership costs, such as $1.4 million for the Edison Electric Institute, despite objections from intervenors who argued the expenses did not benefit customers.

This marks the second rate increase for DTE in just over a year. In 2024, the MPSC approved a $368 million hike, raising average residential bills by $6.51 per month. A recent third-party audit highlighted ongoing reliability issues, ranking DTE and Consumers Energy in the fourth quartile for outage durations and frequency compared to other utilities.

“DTE needs to rein in its requests and be held accountable for continued service and reliability shortcomings,” said Joel King, assistant attorney general, in an October filing. “Customers and the entire state of Michigan deserve better.”