DTE seeks $163 million gas rate hike as heating help dwindles

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DTE Energy is seeking a $163 million gas rate hike that could raise residential rates by roughly 8% beginning next fall.

The increase would add $6.16 to the average customer’s monthly utility bill, DTE spokesperson Ryan Lowry told Planet Detroit. The details are outlined in the rate case the company filed Thursday with the Michigan Public Service Commission.

For ratepayers, DTE’s request comes just after a government shutdown that held up federal heating assistance funding for states.

The proposed 7.96% residential rate increase is roughly 3 1/2 times larger than the 2.28% bump approved by the MPSC one year ago as part of DTE’s $113 million 2024 gas rate increase.

Amy Bandyk, executive director of the Citizens Utility Board of Michigan advocacy group, said a significant chunk of this funding would go toward increasing DTE’s return on equity from 9.8% to 10.25%, which she said is “essentially, the amount (DTE) can bill ratepayers for shareholder profit.” The MPSC lowered DTE’s return on equity from 9.9% to 9.8% in the last gas rate case.

“There is nothing that has changed since that case to justify going the other direction and massively increasing the shareholder return all the way to 10.25%,” Bandyk said.

Bob Richard, president and chief operating officer of DTE Gas, said in a statement that the request will allow the company to “continue investing in the safety and reliability of our system, while keeping costs low for the customers who depend on us for generations to come.”

Gas rate hike proposal arrives during energy assistance ‘crisis’

An increase in DTE’s gas rates would come as the Trump administration throws the future of federal energy assistance programs into doubt.

The administration eliminated the entire staff for the Low Income Home Energy Assistance Program, or LIHEAP, in the spring, raising questions about the future of the program that helps over 400,000 Michigan residents pay their energy bills.

“LIHEAP is in a crisis due to staff cuts and proposed budget cuts, and those problems very well may not be resolved a year from now,” said ratepayer advocate Bandyk. “They could even be worse.”

Vulnerable utility customers often have to choose between covering their energy bills or paying for other essentials like medicine, Bandyk said, adding that DTE’s proposed hike could exacerbate the problem. She cited CUB’s October report on energy insecurity in Michigan.

LIHEAP payments to states were blocked during the federal government shutdown. 

Michigan’s LIHEAP funding, which supports assistance programs like the State Emergency Relief program, will last until the fourth week of November using funds carried over from the last fiscal year, Michigan Department of Health and Human Services spokesperson Lynn Sutfin told Planet Detroit Thursday. 

DTE’s Lowry said the utility advocated for the expansion of the Michigan Energy Assistance Program, or MEAP, which provides utility bill assistance to eligible households through a monthly surcharge on electric bills. 

Legislation signed by Gov. Gretchen Whitmer increased MEAP’s income eligibility threshold. The surcharge increased to $1.25 this year and can be raised by 25 cents a year until it hits $2. 

DTE also offers assistance through the Low-Income Self-Sufficiency Plan, which offers eligible customers shutoff protection, fixed monthly payments, and up to $3,000 in past due balance forgiveness. 

When DTE announced its intention to file a gas rate hike request in September, Michigan Attorney General Dana Nessel said in a statement she would intervene to protect Michigan ratepayers.

Past rate hike requests included millions in “wasteful and inefficient spending” such as the cost of private jet travel, Nessel said.

DTE did not comment on Nessel’s allegations.      

The MPSC has not decided if it will hold a hearing on the rate case, according to MPSC spokesperson Matt Helms. The commission has 10 months to decide on the proposed rate increase. 

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