Michigan Embarks On Largest Natural Gas-Fired Generation Project in Decades
Power generation developers in Michigan are set to embark on their largest generation buildout in decades, as a result of natural gas-fired power projects. These projects are being developed to replace 25 retiring coal-fired power plants that already have closed or are scheduled to do so by 2023.
The Michigan state legislature recently approved a plan to rewrite state energy policy to create approval processes for utilities planning to replace retiring coal-fired power plants; increase a mandate for renewable energy production; and maintain the state's limited energy choice program. The plan, brokered by Governor Rick Snyder, was signed in December of last year and will make it easier for the state to meet its energy needs while protecting the environment and potentially save Michiganders millions of dollars on their electricity bills.
Industrial Info is tracking 17 natural gas power projects in Michigan valued at $3.7 billion, with five combined cycle power projects valued at $2.88 billion.
Michigan electricity providers have met the 10% renewable energy standard set in 2015 and are well on their way to the 12.5% RES for 2020 and 15% by 2021 goal. The state still gets about 45% of its electricity from coal, 26% from nuclear and 20% from natural gas, according to the U.S. Department of Energy.
DTE Energy (NYSE:DTE) (Detroit, Michigan) expects to invest between $1 billion and $1.5 billion in new generation assets expected to be completed by 2023 and being constructed in order to replace retiring coal-fired assets.
Consumers Energy (Jackson, Michigan), another utility based in the state, recently released a request for proposal (RFP) to acquire a natural gas-fired peaking or combined cycle plant of up to 800 megawatts to meet its long term capacity requirements to offset the termination of a power supply contract with the Palisades nuclear plant. The Entergy Corporation (NYSE:ETR) (New Orleans, Louisiana) nuclear power plant is scheduled to close down in October of 2018, due to its age and increased scrutiny by the Nuclear Regulatory Commission (NRC) as well as market and economic conditions.
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