Controversial Data Center in Michigan Faces Scrutiny over Energy Plans
Michigan’s utility regulator has stepped into the spotlight with plans to conduct an online public hearing regarding DTE Energy’s proposal to power a proposed data center in Saline Township, near Ann Arbor. The project has sparked significant debate, with Michigan Public Service Commission (MPSC) Chair Dan Scripps touting the hearing as a step toward “transparency” in the decision-making process.
However, the move was met with criticism from Michigan Attorney General Dana Nessel. She dismissed the hearing as a mere façade, arguing that meaningful oversight and intervention are being sidelined. Nessel commented, “Despite this announcement, the MPSC is still not allowing for meaningful intervention and review on these DTE data center contracts.”
The Data Center’s Journey and Impact
Saline Township, home to fewer than 3,000 residents, initially opposed the data center development, citing non-conformance with its master plan and concerns over emergency infrastructure. The township faced legal action from Related Digital, which develops properties for tech giants Oracle and Open AI. The dispute resulted in a settlement last month, allowing the project to proceed.
The data center is part of a global AI infrastructure initiative known as Stargate, with DTE estimating its electricity needs at 1.4 gigawatts—around 25% of DTE’s current grid capacity. This demand exceeds the output of an average nuclear power plant and rivals that of mid-sized cities. Despite this, DTE claims in MPSC case filings that existing customer rates will not increase, as the data center will cover a minimum revenue threshold.
The Fast-Tracked Approval Process
DTE and the developers seek rapid approval from the MPSC, having filed for contract approval on October 31 with a decision requested by December 5. This expedited process is part of an ex parte case, bypassing the usual contested case proceedings that involve stakeholder evidence and intervention.
Nessel criticized this approach, stating, “DTE has specifically requested their application be approved with no formal hearings or any of the traditional oversight in place that secure the interests of ratepayers and the public.”
Public Hearing or “Performative Listening”?
The MPSC announced a public hearing for December 3, set to be held virtually via Microsoft Teams. The hearing aims to address concerns about the data center’s impact on the power grid, with MPSC emphasizing its commitment to shielding other customers from subsidizing data centers.
Nessel remained unimpressed, asserting that without formal hearings, the event would offer “little more than performative listening.” She added that the MPSC cannot base decisions solely on public sentiment, emphasizing the need for a robust evidentiary record.
Calls for a Contested Case
Environmental and public utility groups are also advocating for a contested case, arguing that state law necessitates such proceedings when utility ratepayers could be affected. Bryan Smigielski of the Michigan Sierra Club remarked, “DTE and the MPSC cannot claim transparency while shutting the public out of the only process that requires DTE to support its claims with actual evidence.”
Ultimately, the MPSC holds the decision-making power, unless a lawsuit arises. The outcome will influence the interplay between regulators, utilities, and AI companies, with implications for energy landscapes and economic dynamics.
How to Join the Public Hearing
The virtual hearing will occur on Wednesday, December 3, from 6:30 to 8:30 p.m. through a Microsoft Teams link or by phone at 1-248-509-0316 with conference ID 593258092#.
Editor’s note: DTE Energy is a corporate sponsor of Michigan Public.
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