Dive Brief:
- DTE Energy announced Monday it is issuing requests for proposals (RFPs) for wind and solar resources coming online between 2021 and 2023, in order to meet short-term needs, the state's renewable portfolio standard and its own carbon reduction goal.
- DTE is seeking solar projects from 25 MW to 200 MW, and wind projects from 100 MW to 200 MW. Over the next few years, DTE has proposed adding up to 775 MW of renewables to its system.
- DTE officials say they will accept multiple bid structures, but in general are looking to purchase and own the renewables projects rather than sign power purchase agreements (PPAs). Bids will be due in early November.
Dive Insight:
"Michigan is in the midst of a pretty substantial energy transformation," DTE Director of Renewable Energy Dave Harwood told Utility Dive. The RFPs announced Monday will help the utility meet its goals over the next two decades, along with filling out resources for short-term needs.
DTE in March announced a plan to reduce emissions 80% below 2005 levels by 2040 through the addition of renewables and increased energy efficiency. It is also working to meet Michigan's 15% RPS by 2021.
More importantly in the near-term, said Harwood, the projects "fulfill new customer needs in our voluntary programs."
DTE's requests are the largest renewable RFPs the utility has issued to date. Harwood said they do not envision a specific solar-wind split and instead are "looking for the right timing and economics." The utility will also consider multiple bid structures including PPAs, but ultimately Harwood said "we're looking predominately to own" the resources.
Some solar advocates say utility-owned projects tend to be more expensive, and Michigan regulators in the past have indicated they wanted consideration of alternative ownership or contractual arrangements.
In a July decision on the utility's renewable energy plan the PSC delayed a decision on some wind projects, saying DTE "failed to prove that proposed company-owned wind projects to be built in 2021 or later, and which do not qualify for the full federal tax credit, can be cost-effective compared to alternative sources of renewable generation and ownership models." Those wind projects will be reviewed as part of DTE's integrated resource plan, said regulators.
Ultimately, the Michigan Public Service Commission will need to approve new resources resulting from DTE's RFP. PSC staff have been involved in the RFP development and reviewed it prior to its release, Harwood noted.
After bids are made in November, Harwood said the utility would shortlist projects and look to negotiate contracts in early 2020.
