Michigan PSC won’t reopen case for new REF coal data

Detroit Edison won a procedural point in a dispute over coal treated with emissions-reducing chemicals when the Michigan Public Service Commission on Sept. 20 refused to reopen the record to allow ostensibly new evidence on how much money parent DTE Energy (NYSE: DTE) thinks it can make from that program.

On Aug. 15, the Michigan Environmental Council, the Natural Resources Defense Council and the Michigan Attorney General filed a joint motion to reopen the proceedings based on the claim of newly discovered evidence. That new evidence was a June 15 filing that DTE made at the SEC that outlined in general terms how much the company would make from the reduced emissions fuel (REF) program.

Detroit Edison said in a Sept. 5 filing at the Michigan PSC that there is no reason to reopen the evidentiary phase of its Power Supply Cost Recovery Plan (PSCR) case because this isn’t really new information.

The investor presentation attached to that June 15 Form 8-K filing at the SEC indicates that DTE expects that a small amount of actual revenues from REF activities in 2011 is expected to grow to $60m in 2016. It also indicates that DTE expects annual earnings from 2013 to 2021 from REF to provide an annual average earning contribution of $50m and expected net revenues totaling more than $450m.

Under the REF program, Detroit Edison sells stockpile coal at various power plants, including the big Monroe plant, to unregulated units of DTE Energy, then buys that coal back to burn in the power plants after it has been treated with chemicals to reduce emissions of pollutants like mercury. Detroit Edison said this is a cost-effective emissions-reduction program for its ratepayers and that having other DTE Energy subsidiaries do this work reduces risk for those ratepayers that the technology won’t work or if there is any problem qualifying the REF product under a federal tax credit program.

“Having reviewed the parties’ motion, the answers, and the evidentiary record, the motion is denied for the simple reason that Movants’, so-called, newly discovered evidence was known to and possessed by Movants prior to the closing of this record,” the commission ruled on Sept. 20.

The commission added: “Furthermore, it is clear that Movants were well aware of how to locate and use information found in DTE’s SEC filings. Due diligence on their part would have led to the discovery of DTE’s February 16, 2012, filing that contained nearly the exact same language found in the [June 15] 8-K.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.