Michigan is nearing the top in the country for power outages.  Utility companies want to raise rates

Michigan is nearing the top in the country for power outages. Utility companies want to raise rates

  • New data shows Michigan has more power outages lasting more than eight hours than most other states.
  • Only two states, Texas and California, suffered more severe blackouts than Michigan in the past five years.
  • Although regulators say the performance is unacceptable, they have approved rate increases that make electricity bills among the highest in the country.

Diana Brown Wilhelm has heard a constant complaint from constituents since she became a member of the Midland City Council in 2011: power outages.

“I swear, we had them monthly, if not more,” Brown Wilhelm said.

That put pressure on seniors in his northeast Midland district, some of whom rely on oxygen and other medical devices. “They need energy to make those things work.”

It’s not just Midland. No matter how you look at it, Michigan residents are affected by more (and longer-lasting) power outages than almost any other state, despite paying some of the highest rates, new data shows.

The performance of Michigan’s two dominant utilities, DTE Energy and Consumers Energy, is again under scrutiny as warm weather puts pressure on the system and DTE seeks a $456 million rate increase from state regulators that would increase Residential bills average $100 or more per year. .

Since 2000, Michigan has trailed only Texas and California in major outages (those affecting 50,000 customers or more) even though those states have many more residents and are significantly larger, according to an analysis by Climate Central, a nonprofit research and communications organization.

A separate Bridge Michigan analysis of county-level outage data found that among the nation’s most populous counties, Michigan residents are most likely to endure a power outage of 8 hours or more, much more so than their peers on the Great Lakes and on par with Texas.

Some counties (Cass and Berrien in southwest Michigan and Alcona in the northeast) had more than 50 outages in which 5% of customers had an outage of 8 hours or more in the last five years.

According to the data, only one county, Houghton, had none.

“The level of performance is unacceptable,” said Dan Scripps, chairman of the Public Service Commission, a government agency that oversees public services.

“That’s maybe what we can all agree on: trying to get to a better place.”

The state agency responsible for overseeing public services, the Michigan Public Service Commission, received 2,700 complaints about outages last year, more than quadruple the annual average of 600 from 2014 to 2020.

The number of major outages has increased in each of the last three years, from 15 to 16 and 17. The previous high from 2000 to 2020 was 11.

And complaints are increasing even as Consumers Energy and DTE Energy have spent hundreds of millions of dollars in recent years to trim and remove trees, replace poles and wires and bury some utility lines.

“There’s no question that every county has a story, and our story is that we’re not happy with where we are,” said Greg Salisbury, vice president of electric distribution engineering for Consumers Energy, which serves nearly 1.9 million of customers in much of Lower Lower California. Peninsula.

DTE serves 2.3 million customers in southeastern Michigan and the Thumb.

“We are confident we are on the right path and will continue to present our plans and rate cases (to the PSC) to get the funding we need to invest in the system.”

In Midland, those efforts have paid off, Brown Wilhelm said. Consumers Energy officials sent crews to replace old equipment in the area, and the once-frequent blackouts nearly ceased.

“We had an outage last year,” said Brown Wilhlem, who credited the utility for working with her and the city to improve service.

But while many residents hoped for greater reliability, some turned to their own solutions. Sales of high-end permanent standby generators, which cost more than $10,000 to install, are increasing, including in the Brown Wilhelm district.

“We’ve installed a lot of permanent generators over the last few years,” said Justin Dankert, residential services manager for Town & Country Group of Midland. “He’s been improving a lot.”

Is bad weather to blame?

The increasing severity of the storms has influenced the increase in recent power outages following severe weather that hit the state repeatedly in 2022 and 2023.

Consumers Energy said it analyzed the weather at 21 Michigan airports and found that the number of hours with damaging wind speeds increased from 2016-18 to 2019-21, leading to more outages. Related data, Salisbury said, shows that Michigan has had more high wind events than airports across Lake Michigan in Wisconsin.

“What we saw is that, in comparison, there are 20% to 30% more strong wind gusts per hour in Michigan,” Salisbury said.

Climate is not the entire answer, said Richard Rood, professor emeritus of climate and space sciences and engineering at the University of Michigan.

He agreed that storms have become more severe in recent years, driven by rising temperatures. Other states, such as Texas, Louisiana and Florida, have been hit by more severe hurricanes in recent years, and more violent storms are occurring across the country, she said.

But Rood said they are more intense in many places, not just Michigan.

Ohio, Indiana, Illinois and Wisconsin have far fewer outages, the data shows.

“It’s really hard to say that Michigan is experiencing more severe weather than anywhere else in the Midwest,” Rood said.

For consumer advocates, the cause is rooted in how utilities have kept their systems expanding.

Investments delayed?

Amy Bandyk, executive director of the Michigan Citizens Board of Utilities, blamed the state’s utilities for a “lack of focus” on strategies like tree trimming.

“DTE and Consumers Energy are trying to catch up now and speed up the cycles with which they trim trees, but the damage to their performance has already been done,” Bandyk said in a statement.

He said Michigan had the sixth-longest outage in the country in 2021.

No one questions the low reliability ratings of the state’s largest utility companies, which have a blackout duration rate nearly double the national average.

And both Consumers and DTE told Bridge about their past work and their ongoing plans to improve the systems. (DTE Energy and Consumers Energy are Bridge Michigan funders.)

Scripps, chairman of the PSC, said companies are improving their systems but more needs to be done.

Since December, the PSC has approved rate increases for DTE and Consumers that include funding to improve reliability. That puts some of the burden on customers, who will pay more for energy while also having the highest residential rates in the region and some of the highest in the country.

Those increases come as the average residential bill in Michigan ($92.85 per month for 500 kilowatt hours of power) is 17% higher than the Great Lakes average of $79.55 and 11% higher than the US average of $82.40.

Brian Calka, vice president of distribution for DTE, said the utility’s “increased” tree trimming has reduced outages by 40% to 50% in some areas.

So far, the utility has implemented the program in 85% of its service area and expects to complete it by the end of next year, Calka said.

“We recognized through our metrics and data and a very thoughtful focus on customers that we need to do better, and that we needed to do better in the 2018, 2019 period,” Calka said.

“…We are by no means sitting back and are happy and happy with the performance we have delivered to our customers when it comes to reliability.”

That’s what has made the most recent outages more frustrating for utilities and customers: They occurred despite additional work across the state.

In the Midwest, total precipitation from the worst storms (the top 1%) increased 42% between 1958 and 2016, according to Great Lakes Sciences and Assessments.

“We’re shooting at a moving target,” Consumer’s Salisbury said, “because (utility) assets are aging, trees are growing and customer demand is changing. And we have this increasingly severe climate.”

Are regulators strict enough?

Michigan regulators have granted rate increases in recent years but have reduced the size of those requests.

Regulators also increased the amount utilities must pay customers who lose power ($38 a day, up from $25) and reduced the time period before an outage is considered “unacceptable.”

Bandyk, the consumer advocate, has long been critical of utilities and the Public Utilities Commission.

But he acknowledged that “that’s being tougher on the utilities, but ultimately motivating the utilities to really change their behavior for the benefit of customers.”

One industry analyst firm, S&P Global, wrote that Michigan’s regulatory system has created a “more credit-friendly” environment for utilities.

That’s not a badge of honor, said CUB’s Bandyk. He wants the commission to require more utilities it regulates and force them to dig deeper into their profits to create more reliable systems that benefit consumers.

Consumers had net revenue of $876 million in 2023, for a profit margin of nearly 12%, while DTE had net revenue of $1.4 billion in 2023, for a profit margin of 11%. Both utilities increased their profit margins in 2023.

Scripps, chairman of the PSC, said the regulator has demanded more from the state’s utilities, and not just from Consumers and DTE.

He said more scrutiny could come after the completion of a first audit — independent but paid for by the utilities — that compares Michigan to similar utilities in other states. It’s scheduled to come out this summer, he said.

And he’s hopeful the commission will make sure utilities’ promises to shore up systems and trim trees are kept. He said in the past those efforts have been diverted toward other projects, such as improving storm response.

But the result was that the reliability of the systems did not receive the necessary attention, he said. And that has led to a growing number of cuts.

“At the end of the day, the reliability improvements were not implemented, so we found ourselves in a deeper hole,” he said.