The U.S. Department of Energy’s Loan Programs Office has announced Consumers Energy could receive up to $5.23 billion and DTE Energy up to $8.8 billion in loans.
The federal loans would have a lower interest rate than private market loans, and the utilities said that will save customers money on their bills for covering necessary investments. Both companies have aging natural gas pipelines that need to be replaced and upcoming renewable energy projects. The loans help fund both.
But the Department of Energy loans fall under the Inflation Reduction Act, and President-elect Donald Trump has said he wants to repeal the law and claw back any unspent IRA money that has been promised to recipients.
In a statement, Consumers Energy said, “These would be projects that already are in our long-term plans. The Department of Energy says this is a legally binding agreement. We will work with the incoming presidential administration with the same goal of doing what’s best for the Michigan customers we serve.”
In its press release, the DOE said the loans will help Consumers Energy meet its ambitious goal of net-zero greenhouse gas emissions for the entire business by 2050.
In addition, “by supporting Consumers Energy’s ongoing legacy pipeline replacement program, LPO will help the utility reduce methane leaks from its existing operations and support Consumers Energy’s efforts to attain net zero methane emissions from its natural gas operations by 2030.”
(Consumers Energy is among Michigan Public's corporate sponsors.)
For DTE, the agency said, if finalized, the loans would help accelerate the company's gas division "in updating of natural gas main and service distribution lines and move metering infrastructure outdoors," while the guarantee to DTE Electric is expected to help finance significant generation and battery storage."
