DTE Energy will have retired 3,500 MW of coal capacity by 2030

DTE Energy (NYSE:DTE) reviewed its coal retirement program and changing energy mix during a business update for investors that was filed with the Securities and Exchange Commission (SEC) Jan. 7 as part of an 8-K report.

Due to factors such as the Environmental Protection Agency (EPA) Clean Power Plan, DTE’s coal-heavy electric utility expects to get only 25% of its power generation from coal by 2030. The Clean Power Plan instructs states such as Michigan to cut power sector carbon dioxide (CO2) emissions 32% by 2030.

DTE expects that its generation mix will shift from coal to natural gas and renewables in order for the company to attain compliance with the EPA carbon reduction plan.

By 2030, subsidiary DTE Electric expects that its fuel mix will be 15% from nuclear and “other”; 15-to-30% from renewables; 30% to 45% from natural gas and 25% from coal.

The company is in the middle of an extensive program of coal retirements. In 2015 DTE retired 125 MW of coal. By 2030, the company will have retired 3,500 MW of coal capacity.

Environmental groups have argued against Michigan Public Service Commission approval of rate recovery for environmental controls at certain surviving coal units. Environmental groups have also argued that DTE’s electric utility should utilize more demand side management in its planning.

DTE will invest roughly $13bn in capital projects to drive growth through 2020, the company said in the presentation. About $8.2bn of that figure will go toward electric power spending, including distribution infrastructure, maintenance and new generation.

DTE also said that investment in its gas utility will increase significantly over the next five years.

DTE is involved with the Millennium Pipeline project. In addition, DTE and Spectra Energy (NYSE:SE) are partners in the NEXUS gas transmission project, which is designed to transport growing supplies of Appalachian Basin gas, including Utica and Marcellus shale gas production, to customers in the U.S. Midwest, including Ohio and Michigan, and to customers in Ontario, Canada.

The NEXUS project involves 250 miles of pipe and will originate in northeastern Ohio. DTE’s expected investment is $1bn.

The NEXUS project is on track, DTE said, noting that the FERC filing was completed in November.

DTE’s financial performance is being helped by an improving Michigan economy. Michigan is enjoying its lowest unemployment since 2001 and its most new manufacturing jobs since 2009, the company said.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.