July 13, 2015

DTE Energy Issues RFP for Voluntary Solar Program

DTE Energy Co. has issued a request for proposals for multiple solar-generating plants in Southeast Michigan that would range in size from 5 megawatts to 50 megawatts.

Companies or individuals would propose to build the solar power generation plants and DTE would reimburse their costs. To offset its costs, DTE would own the solar stations and sell subscriptions to customers who would receive credits on monthly bills, said David Harwood, DTE’s director of renewable energy.

The energy produced from the solar plants would feed directly into the grid -- builders would not get direct access it. But organizations interested in supporting solar by volunteering to build the facilities in Michigan ultimately would not have to shoulder the costs under this program because they would be reimbursed for their costs, Harwood said.

Harwood said this model “opens door to thousands of customers because some don’t own a roof” on which to build a solar system. The amount of the credit they would receive must first be approved by the Michigan Public Service Commission, he said.

Notices of intent to bid for DTE’s solar projects are due July 22. Bids are due about two weeks later with project selections this fall. The solar projects must be completed by Dec. 31, 2016, to be eligible for federal solar energy tax credits, which substantially defrays costs, Harwood said.

Over the past year, DTE studied its own experience with solar power generation and concluded that large solar projects are more cost-effective than smaller residential or business-owned rooftop solar units.

“We feel very strongly there is a huge economy of scale with large utility-owned assets,” Harwood said. “Customers could subscribe to these programs at the same size as they would be built on their home. The utility would take the responsibility of owning a system.”

DTE has not set a target for the total number of megawatts it wants generated by the voluntary solar program or how many facilities will be built.

“The size and amount will be determined by responses, by bids, the price points and consumer demand,” Harwood said. “We are not going to overbuild.”

Harwood said DTE plans to create a voluntary community renewable energy program for customers, which is expected to include additional wind farms.

“We want to start with solar and potentially offer wind in the program later,” he said.

DTE’s voluntary program would generate power beyond the 10 percent renewable energy required by the state’s 2008 renewable energy law, PA 295. DTE recently announced it has met the 10 percent renewable power generation threshold, which utilities are mandated by the law to reach by the end of this year.

Michigan legislators are debating whether to continue or extend the renewable energy mandate another five years. However, Republican legislators appear more in favor of allowing utilities to voluntarily invest in renewable energy under a free market approach.

Earlier this year, Jackson-based Consumers Energy Co. received state approval to begin a 10-megawatt community solar program. Called Solar Gardens, the solar program could begin this year and produce electricity in 2016.

Under Consumers' Solar Gardens project, individual and business electric customers could purchase subscriptions in 0.5 kilowatts blocks, which could cost $28 to $41 per block.

Participants then would receive a bill credit — estimated by Consumers to be about $9.25 per month in 2016 — over 25 years based on their investment and the amount of electricity generated by the solar installation.

The average Michigan electric residential customer uses about 700 kilowatt hours per month, which costs about $100.

Solar power represents a small amount of the total of renewable energy generated in Michigan. For example, DTE expects to produce about 2 percent of its state-mandated 10 percent renewable energy production through solar. Consumers projects less, about 1 percent renewable energy from solar.

Since 2008, Consumers Energy generates about 850 megawatts of renewable energy power, the vast majority coming from wind turbines. DTE will produce about 950 megawatts of renewable energy by the end of 2015 also primarily from wind power.

Over the past five years, DTE has invested more than $2 billion in renewable energy, including $50 million in solar energy. It has built and operates more than 20 large solar installations, including facilities at Ford Motor Co. headquarters in Dearborn and Monroe County Community College.

Land owners with a minimum of 20 acres who are interested in hosting a DTE solar project or those interested in learning details about the facility can email renewsuppliers@dteenergy.com

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