DTE seeks another rate increase citing inflation, material costs

DTE Electric Co. is requesting a rate increase just months after receiving its last one, a hike that would raise the average customer’s bill by $12.46 a month. 

If approved, the rate increase would be the eighth for DTE since 2010, and it comes after the utility’s last rate increase in November. 

Last year, DTE sought to up its rates by 8.8%, but the Michigan Public Service Commission (MPSC), which regulates investor-owned utilities in the state, approved just 10% of the utility’s total request. The decision came after more than 200 people largely in opposition packed the first hearing of its kind held by the MPSC to consider DTE’s proposal, according to Planet Detroit. 

On Feb. 10, DTE asked the MPSC for permission to increase its yearly revenues by $622 million, representing a nearly 14% residential rate increase. If the MPSC approves the request, the average residential customer’s bill could climb by $12.46 per month as soon as Dec.10, according to DTE’s application. 

“It is somewhat shocking how much DTE is basically thumbing its nose at the public service commission with this latest rate case filing,” said Amy Bandyk, executive director of the Citizens Utility Board of Michigan. 

In its application, DTE said the rate increase would recover costs associated with investments in electric distribution, its tree trimming program, and other operations. DTE’s request follows a pattern of high rate increases in short amounts of time, with poor service, according to several independent analyses. 

Since 2010, DTE has been granted billions of dollars worth of rate increases. The utility has the highest kilowatt-per-hour rate compared to the other largest utilities in the Great Lakes region, according to an analysis by Outlier Media and ProPublica. Meanwhile, DTE has some of the most frequent, and longest lasting power outages in the country, and has a high rate of shutoffs for customers struggling to pay their bills. 

But, “DTE’s Electric Company intentionally did not request a base rate increase during the COVID pandemic to assist customers with affordability during uncertain times,” spokesperson for DTE Peter Ternes, told BridgeDetroit. In that same timeframe, Ternes added, DTE invested more than $8 billion into its electric grid.  

“In order to continue to make the progress that customers and the Michigan Public Service Commission expect, and to deal with continued inflation and material cost increases, DTE needs to file a rate case,” he said. “The outcome of this rate review will set the course for how we continue to make progress in electric system reliability improvements – preparing the electric grid for increased electrification and increasingly severe weather – and carbon reduction efforts.” 

In November, the MPSC rejected 90% of DTE’s request, disputing the company’s projections of declining electricity use and therefore less revenue to conduct various programs and operations.  

“In their order in the last rate case last November, the MPSC told DTE it had not justified its big proposed rate hike. Now, the utility is coming back and asking for the same amount of money, plus a lot more,” said Bandyk. “DTE appears to be ignoring the message from both regulators and their customers that they need to spend ratepayer dollars cost-effectively. That’s a problem because DTE customers are already paying high rates for poor service.” 

In August 2022, the MPSC ordered an audit of DTE and Consumers Energy following a storm that left 500,000 residents without power, some for a week. The audit has not been completed yet, according to MPSC spokesperson Matt Helms. 

To further transparency, Michigan Attorney General Dana Nessel has been pushing for more transparency from utilities about how political contributions might be influencing policy.

Earlier this month, Nessel submitted comments to the MPSC advising that revised rate filing requirements should require utilities to report political contributions for the most recent five years prior to filing. 

“The Attorney General finds that the [Rate Case Standard Filing Requirements] are currently deficient in providing sufficient information and insight on expenses incurred by the utilities to influence public policy and achieve rate case outcomes,” the letter stated. 

Almost the entire Michigan Legislature has received donations from DTE, totaling $1.26 million, according to a report last year from the Energy and Policy Institute. 

“If 138 out of 148 senators are taking money from them, it doesn’t seem like we’re going to have a fair shot at getting listened to or getting support from the state,” argued Jesse Deer in Water, an organizer for CRAFT, an Indigenous-led environmental justice organization. 

“DTE does not need a rate increase, they need a rate decrease,” he told BridgeDetroit, noting the proposed rate increase compounds the last one and the company’s time-of-day plan launched in January, which increases rates during peak use times. 

“This feels like an almost full-spectrum assault to our communities’ pockets,” he said. 

Citizens can submit comments to the Michigan Public Service Commission regarding DTE’s  rate increase application online. A pre-hearing to consider the request will be held remotely March 7.  

Correction: An earlier version of this story misstated the percentage increase for residential customers if DTE’s request is approved.

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