DTE Energy Co. is laying groundwork for a 30,000-plus acre wind development that could provide power to its Southeast Michigan customers and cost an estimated $1.2 billion to $1.5 billion.
This is the largest wind-energy project proposed in Michigan. Utilities, state officials and businesses increasingly are looking at renewable energy to power part of Michigan’s future.
DTE has purchased easements on some 30,000 acres in the Thumb area’s Huron, Tuscola and Sanilac counties and has erected towers that measure wind speed, as it studies the feasibility of a project that could help it meet a brewing state standard to require utilities to obtain a percentage of their future power generation from renewable sources.
Such a standard is under discussion in the Capitol as part of a state strategy to meet long-term energy needs.
“Michigan started talking about a renewable-portfolio standard in earnest about third quarter last year,” said Trevor Lauer, DTE vice president of marketing. “As we got involved in discussions … we thought it would be a very logical thing to start to purchase easements.”
The 30,000 acres could accommodate about 300 wind turbines that would generate about 600 megawatts of electricity, enough to power some 175,000 homes.
Lauer said the company is talking to equipment manufacturers, financing agencies, land owners, engineering firms, wind farm developers and others.
The turbines likely would be built in clusters, forming four or five wind farms on the Thumb property. Electricity produced would flow into Detroit Edison Co.’s system, and the windmills would be part of the utility’s rate base, just like other power plants.
Customer rates would increase, but that doesn’t necessarily mean higher customer electricity bills, Lauer said. The utility wants any renewable-portfolio standard enacted by the state to be accompanied by energy-efficiency measures that would help customers reduce their electricity usage and result in bills that are unchanged overall.
Also entering into the Capitol debate and DTE’s wind farm considerations are changes to Michigan’s 2000 electric choice law.
The law allows Detroit Edison and Consumers Energy Co. customers to choose alternative-electricity suppliers. But the utilities say Michigan’s partially regulated system must change and that they need customer certainty if they are to build power plants and make other investments.
“We wouldn’t move forward with building all this wind without fixing electric choice in the state,” Lauer said, in reference to the turbines.
But customers and others who are fighting efforts to eliminate choice say the 2000 law has helped hold down electricity rates, spurred independent power producers to develop new plants and saved customers millions of dollars.
Dave Waymire, spokesman for the Customer Choice Coalition, said no new energy investments should go into a utility’s rate base until they are competitively bid.
The coalition, which encompasses large- and small-business groups, consumer interests and alternative-electricity suppliers, supports Senate legislation that would set up a process for bidding on new plants.
“We believe competition is the way to move forward on renewables, as well as more traditional coal, nuclear or natural-gas power generation,” Waymire said, “because competition is the only way that we will know that Michigan is getting the lowest-cost power.
“As long as we have a competitive market, we would encourage everybody to look at all alternatives. Right now, we have no idea whether their (DTE’s) proposed wind farm is going to be more or less expensive than one developed by any other company. But in the competitive market, we don’t care. What we do object to is … that they build a wind farm and that customers then are forced to pay what Detroit Edison says is necessary.”
Throughout the state, wind’s potential is being examined or tapped. Consumers Energy, as part of its voluntary customer “Green Generation” renewable-energy program, purchases electricity produced by two wind turbines near Mackinaw City and has entered into contracts with other wind-generation projects, including one in the Thumb.
Construction is under way on a $90 million wind farm in Huron County that is a joint venture between John Deere Wind Energy and Wolverine Power Cooperative. And DTE in August announced an agreement with Traverse City-based wind-power developer Heritage Sustainable Energy L.L.C., which is building turbines on a 6,500-acre site near Cadillac.
That project, and an operation announced last week that will convert cow manure to electricity, will supply power for DTE’s voluntary “Green Currents” program.
Participating Detroit Edison customers pay a surcharge for green power that subsidizes Edison’s renewable purchases. The program helps build customer demand that, in turn, fuels the development of Michigan-based renewable-energy supplies.
DTE’s program, launched in May, has signed about 5,200 of Detroit Edison’s 2.2 million customers. Consumers Energy’s renewables program, launched in September 2005, has signed up 11,200 of the utility’s 1.8 million electric customers.
Dan Radomski, vice president of industry services for NextEnergy, a Detroit nonprofit charged with advancing Michigan’s alternative-energy industry, said the utilities are preparing for more renewables in their portfolios.
“Wind makes a lot of sense for the state of Michigan,” he said, but state policy, in the form of a renewable-portfolio standard, or RPS, is key.
“Wind power, even though it’s very competitive with coal – for major projects to find their way into the state of Michigan, an RPS really needs to be in place,” Radomski said. “An RPS will stimulate the market in a big way.”
By Amy Lane
29 October 2007
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