Dana Nessel Criticizes Michigan Data Center Review as a ‘Rush Job’
DTE Energy is seeking quick approval from state energy regulators to provide power for Michigan’s first hyperscale data center. Attorney General Dana Nessel has criticized the review process, describing it as a “rush job.” She raised concerns about inadequate public scrutiny of the contract, fearing it could lead to increased energy bills and environmental harm.
Concerns Over DTE Energy’s Fast-Track Proposal
The proposal involves supplying energy to a new artificial intelligence data center in Saline Township. This center is backed by major technology firms including Oracle and OpenAI. DTE Energy plans to supply power equivalent to that needed for one million homes, with a contract value potentially in the multi-hundred-million-dollar range.
Nessel emphasized that the Michigan Public Service Commission (MPSC) is under intense political and industry pressure to approve the contract quickly. She referred to a press conference where she expressed concerns about the commission possibly “rubber stamping” the proposal.
Implications of the Data Center
State Representative Morgan Foreman highlighted the significance of this decision, stating it sets a precedent for future data centers and AI developments in the state. Without sufficient public engagement, this could lead to troubling precedents for upcoming utility projects.
- Project cost: $7 billion
- Power capacity: 1.4 gigawatts
- Potential job creation: hundreds
- Annual tax revenue: millions
Regulatory Review Timeline
DTE Energy is racing against time, as company officials assert that delays could cause technology firms to reconsider their investment. DTE Directors have announced a tight schedule for construction, emphasizing that Oracle may choose a different location if they cannot secure timely approval.
The MPSC has scheduled a public hearing on December 3 to gather community input on the proposal, but critics argue that this is insufficient. They have urged the MPSC to initiate a contested case process, which involves more thorough investigation and formal hearings.
Potential Ratepayer Impact
The contract raises concerns about its long-term impact on Michigan energy rates. DTE Energy currently serves around 2.2 million customers and has faced criticism for its rate increases and frequent service outages. Opponents worry that this deal could result in higher costs for consumers.
State law requires that data centers must pay for system upgrades to avoid placing the financial burden on residential customers. However, the lack of transparency in DTE’s contract filing has made it difficult for advocates to verify compliance with these regulations.
Environmental Considerations
Environmental advocates are particularly concerned about the potential ecological effects of hyperscale data centers. These facilities typically consume large amounts of energy and water, which could exacerbate existing environmental issues. Critics point out the need for clear commitments from data center operators to utilize renewable energy sources.
Michigan law mandates that data centers procure at least 90% of their energy from clean sources by 2040. DTE has assured that it can comply with these standards but has not provided specific details on how it plans to achieve this.
The upcoming MPSC meeting on December 5 will be crucial in determining the fate of DTE Energy’s contract for the new data center. If the commission does not open a contested case, the decision could be challenged in the Michigan Court of Appeals, making this a pivotal moment for energy policy in the state.
