DTE electric capacity expected to be only 25% coal in 2030

DTE Energy (NYSE:DTE) is making solid progress in retiring aging coal-fired generating capacity and replacing it with a combination of natural gas and renewable resources, the company said in an Aug. 11 presentation to investors.

Michigan-based DTE filed a copy of the investor slide presentation with the Securities and Exchange Commission (SEC) on Aug. 10.

The company’s regulated DTE Electric has already begun to retire its coal-fired generation. Where the company’s electric capacity was 55% coal-fired in 2015, it is projected to be only 25% coal-fired in 2030. The percentage of natural gas capacity is expected to increase from 20% in 2015 to between 30% and 40% by 2030.

The DTE slides also predict that renewable capacity will grow from 10% in 2015 to anywhere from 15%-to-30% in 2030. The percentage of nuclear-and-“other” is expected to remain at about 15%.

(While DTE has a license to develop a new nuclear reactor at the Fermi station, it currently has no plans to actually make such an investment).

The coal-retirement timeline started in 2015. Retirements, between now and 2025, of several coal units at the Trenton Channel, River Rouge and St. Clair power stations have already been announced. About 2,500 MW of coal capacity retirements have been announced for the 2015 through 2025 time period.

DTE also plans to eventually announce another 1,000 MW of coal retirements that would be carried out between 2026 and 2030. That grand total of coal retirements between 2015 and 2030 will be 3,500 MW, DTE noted.

DTE is replacing the retired capacity largely with a combination of natural gas and solar-and-wind energy projects. DTE purchased two natural gas combustion turbine units in 2015 and is developing the largest utility-owned solar array east of the Mississippi, DTE said. The company added that the big solar project should be in service during the first quarter of 2017.

DTE reported that its carbon dioxide (CO2) emissions were reduced 16% between 2005 and 2015. By 2030, DTE expects that its CO2 emissions will have been slashed 40% from 2005 levels.

The company’s sulfur dioxide (SO2) emissions were already cut 67% between 2005 and 2015. The nitrogen oxide (NOx) emissions were reduced 61% during that same 10-year period, DTE said.

“Emission reductions are largely due to $2 billion in controls installed at Monroe Power Plant, new technology and reduced reliance on coal-fired generation,” DTE Energy said. “In addition, mercury emissions have been reduced 42% since 2005 with 75% reduction expected by 2030.”

DTE said that it is also expanding and strengthening its natural gas infrastructure. A $200m investment through 2017 will help reduce leaks and lost gas. The gas infrastructure improvements will include transmission, compression, distribution and storage, DTE said.

The utility holding company will be spending roughly $8.2bn between now and 2020 on distribution, infrastructure, maintenance and new generation.

DTE said that its projected 5% to 6% growth does not depend on new energy legislation.

DTE’s earnings are 95% regulated or contracted, consisting of electric and gas utilities, FERC-regulated pipelines and long-term contracted energy projects.

In the meetings and the presentation, DTE Energy reaffirms its 2016 operating earnings guidance range of $4.91 – $5.19 per share.

 

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.