Title
Resolution to Confirm Support for the City’s Ongoing Interventions in DTE Electric and DTE Gas Rate Cases and Other Key Cases Before the MPSC Impacting Ann Arbor Residents
Memorandum
For nearly five years, the City has been intervening in various cases before the Michigan Public Service Commission (“MPSC”), including DTE Electric rate cases, DTE Gas rate cases, Integrated Resource Planning cases, Voluntary Green Pricing cases, and more. This effort has been led by the City Attorney’s Office and the Office of Sustainability and Innovations, with occasional support from other City departments.
Thanks in part to the City’s intervention in MPSC cases, DTE ratepayers have saved over $1 billion in electric and gas service expenses over the last several years. This success was the subject of a public memorandum from the City Attorney’s Office titled, “Ann Arbor’s Participation in DTE Electric and DTE Gas MPSC Cases Since 2022,” which was made public at the City Council meeting on Monday, March 3, 2025. Since that time, the City has intervened in two additional cases - a DTE Electric rate case and a DTE gas rate Case.
Combined, the City has taken part in eleven different MPSC proceedings to not only challenge steep rate increases, but also improve the comprehensive experience of DTE customers, while simultaneously advancing actions that contribute to the City’s A2ZERO carbon neutrality goals. Some of the notable achievements outlined in the memo include:
• Saving DTE Electric ratepayers over $1 billion and DTE Gas ratepayers over $150 million since 2022.
• Limiting average residential electric rate increases to less than 40% of what DTE Electric requested over the last several rate cases.
• Maintaining DTE Electric shareholders’ rate of return on equity (ROE) at 9.9% and decreasing DTE Gas shareholders’ ROE to 9.8% despite the companies seeking ROEs up to 10.5%. Every tenth of a percentage saves ratepayers millions of dollars.
• A directive for DTE Gas to update its Gas Delivery Plan to consider the transition away from fossil gas, and to indicate how it will achieve emissions reduction goals.
• Rejection of a proposal to pay DTE Electric a bonus for reliability even when DTE’s performance violated the rules requiring minimum performance levels.
• A requirement for DTE Electric to better coordinate with local governments and other utilities, which should lead to cost savings, reduced disruptions to residents, and less damage to infrastructure.
• A requirement for DTE Electric to provide evidence for each -and every outage credit it attempts to recover from customers.
• Keeping a fixed price option for residential MIGreenPower subscribers, and elimination of unfair termination clauses for commercial and industrial MIGreenPower subscribers.
• Securing credits for communities that paid up front for LED streetlights before they were standard.
While the memorandum only highlights progress made through February 2025, it provides evidence of the importance of the City’s interventions in helping save ratepayers money and advancing other City priorities.
As one illustration, the City of Ann Arbor’s intervention in the 2025 DTE Electric rate case (Case No. U-21860) helped save ratepayers hundreds of millions of dollars on their electricity bills. Filed on April 24, 2025, DTE Electric’s rate case application requested that, among other things, the MPSC, authorize an annual revenue increase of $574.1 million, which included a requested residential rate increase of 11.1%. But thanks to the intervention of the City of Ann Arbor and over a dozen other stakeholders, the average residential rate increase was limited to 4.1%. The City of Ann Arbor intervened in the DTE Electric rate case to ensure requested investments were reasonable, prudent, and aligned with a recent audit of DTE’s distribution system (Case No. U-21305). The City's intervention also focused on minimizing any rate increase, given the significant impact that rate increases have on the City, its residents, and its businesses.
While the City shared many arguments with other intervenors, it was the only party to advocate for (and win) the following:
• A requirement that DTE track the costs of tree-related outages. This will lead to data that can be used to quantify the cost to ratepayers should DTE fall behind on tree trimming. This information can be used as a basis for imposing financial consequences on DTE for falling behind on a practice that has been proven to cost-effectively prevent outages.
• Denial of cost recovery for a gas generator program that not only was counter to climate goals, but also would have cost ratepayers $532,000, even though the program had been terminated.
With the news that DTE Electric has just filed another rate case (U-22046), in which it seeks an annual revenue increase of approximately $474.3 million, including an average residential rate increase of 9.7% and a 10.1% increase in streetlighting rates, the City is gearing up to once again intervene to scrutinize DTE’s requested funding and oppose any that isn’t reasonable and prudent.
This resolution seeks to support staff in continuing to intervene on behalf of Ann Arbor ratepayers and other ratepayers throughout DTE’s service territory, and to inform the public of the efforts of City staff leading to tangible results.
Budget/Fiscal Impact: Funding for intervention is already budgeted in the Office of Sustainability and Innovations FY26 budget.
Staff
Prepared by: Missy Stults, Sustainability and Innovations Director
Reviewed by: Kim Hoenerhoff, Financial Analyst
Reviewed by: Valerie Jackson, Assistant City Attorney
Reviewed by: Atleen Kaur, City Attorney
Approved by: Milton Dohoney Jr., City Administrator
Body
Whereas, The City of Ann Arbor has been intervening in utility cases before the Michigan Public Service Commission for over five years;
Whereas, the City of Ann Arbor is often the only municipal entity to intervene independently and/or advocate for particular issues;
Whereas, The City’s interventions have contributed to over a billion dollars in savings for DTE ratepayers;
Whereas, The City’s interventions have demonstrably moved forward goals of energy affordability, clean energy, electric grid reliability, and utility accountability;
Whereas, The City’s Office of Sustainability and Innovations and the City Attorney’s Office have led these interventions, with support from staff in Public Services;
Whereas, The Office of Sustainability and Innovations had budgeted to continue interventions throughout calendar year 2026;
Whereas, DTE Electric filed another rate case, U-22046, only two months after receiving a rate increase from the Michigan Public Service Commission; and
Whereas, City Council wishes to express its desire for the City to continue intervening in relevant Michigan Public Service Commission cases to represent the interests of our residents, businesses, and the City itself;
RESOLVED, That City Council affirms its support for the City Attorney’s Office and the Office of Sustainability and Innovations to continue to intervene on behalf of the City in relevant cases before the Michigan Public Service Commission; and
RESOLVED, That City Council request a summary of the outcome of each such case, including the impact of the City’s intervention, within 2 months of the final order in each case.
Sponsors: Mayor Taylor and Councilmembers Radina, Cornell, Harrison, and Mallek