The Red-Blooded, Gas-Fired Future of Midwestern Energy

I attended a forum on DTE’s Integrated Resource Plan Tuesday. The state’s public service commission, an entity that seems to exist under an aggressively anti-regulation governor mostly as a formality, requires this sort of forum as part of periodic outreach. My typical response to these sorts of shindigs is a shrug; color me underwhelmed.

Marketing on a Fortune 500 budget can even make Zug Island sexy. (DTE Energy)

First, the majority of the people there were staff, which indicates that the outreach efforts were severely limited, given that it was smack dab in the middle of the largest city in Michigan– and at a community college, no less. Second, and this is just me being bitchy, they had “catered” food from Subway, so, apparently cheese and crackers. I need my daily fix of yoga mat chemicals, people! Maybe it was the fact that they were a “local” business (located about ten feet away in the basement of the WCCC commons space)? I don’t know. It certainly wasn’t an open bar kind of shindig.

After perusing the various offerings– get pocket change in rebates off a multiple thousand dollar boiler upgrade, get DTE to install aerators on your faucets because mother earth, come work at a leading company if you have an MBA or an engineering degree- I spent the majority of the time talking with one gentleman in particular who delivered a number of gems, including:

“I can’t drive a hybrid car because I live in the country!”

“We can’t invest money in unproven technology like microgrid, PV, or wind!”

“How are you going to power your grid with solar when it gets dark at night?”

“If low-income people want to have lower utility bills, they should finance their own energy retrofits!”

Chicago isn’t part of the PJM.” (Yes, they are.)

“DTE doesn’t have a facility on Zug Island.” (Narrator voice: “They do.”)

Claiming erroneously that Germany is building new coal power plants because their grid’s supply isn’t resilient enough with their high-renewable gen mix, he also delivered some apparently completely made-up factoid that there were 15,000 abandoned wind turbines in Canada, so we should instead invest in natural gas. I couldn’t find anything about this and, as someone who follows North American energy and sustainability news fairly closely, I would probably know about it, though I did find one article about a decomissioned, older wind farm in Alberta, which, also, Alberta.

The story with Germany is a bit more complex. They’re committed to phasing out coal, but the widely available, cheap lignite (braunkohl) is being replaced by imported bituminous and anthracite coal. Europe is still generally struggling to figure out how to address Angela Merkel’s Energiewende given the continued widespread European reliance on dirty coal.

But they’re doing the damn thing. In Germany on the POCACITO trip, I saw a lot of crazy things.

Q: Why did you feel the need to spend millions of euros on a superconducting, subterranean power line to supply your municipality?

A: Uh, I don’t know, because technology? Because we could?

Also maybe the fact that a superconductor can handle the same electrical load that a much thicker set of power lines can, and with no conductive losses.

Maybe this will be important when we have to, say, move electricity from wind farms in Iowa and Minnesota to Chicago. Or West Texas to the Gulf Coast. Etc.

But the “because we could”– that’s what’s important here: Experimental technologies need to be tried out so they can be proven. Proven technologies need to be deployed in pilot projects to see how they can be scaled. And scalable projects can be implemented grid-wide through a partnership between a nimble, well-capitalized private sector, forward-thinking local policymakers, and nonprofit community liaisons to connect the dots. Often, the context is as interesting as the projects themselves. The Hamburg Energy Bunker, for example, is a World War II memorial slash solar thermal district heating plant slash wedding venue and café.

I could go on about POCACITO forever, but this post is already longer than I wanted it to be. I have three simple ideas here for a starting point. These are things that could be produced through mostly bipartisan legislative initiatives, could be produced jointly between citizenry, utilities and energy companies, and governments, and could be fertile ground for a public-private partnership extravaganza that could help Michigan and beyond improve the resiliency of electrical grids while generating overall net gain for the economy.

  1. On-bill financing to allow customers to affordably amortize the cost of energy efficiency retrofits, namely building envelope retrofits to residential buildings. This would
  2. Regulatory incentives and disincentives to encourage energy waste reduction at the industrial level and to discourage heavy-polluting production, whether in terms of generation or industry. This would best done in the form of a carbon tax. High-carbon production is usually also high-particulate (petrochemical and steel mills are among the biggest and are certainly the biggest here). So, while Amp Rand at the forum believed that DTE’s sole responsibility is to sell power and that’s it, I reminded him that the monopolistic nature of monolithic power generation meant that a massive industrial facility can’t simply move or go to another provider. The problem is obviously political feasibility. People in Michigan would riot if anyone tried to impose a carbon tax because it would interfere with their God-given right to drive their F250 Super Duty as far as they can to as many strip malls as they can. But short of a carbon tax or a carbon tax paired with a cap-and-trade system, there are still oodles of affordable regulatory and tax incentives that could be used to reduce energy waste at the industrial level, push renewable generation toward parity with (frankly heavily subsidized) fossil fuel sources, and, in decentralizing production, make grids work better.
  3. Proof-of-concept programs and pilots to test and demonstrate the viability of experimental, emerging, and, over a large sample size, profitable energy technologies that can increase grid resilience. The success of a large-scale deployment of Tesla’s Powerwall, for example, proves that this is possible. DTE has some experimental pilot programs with residential-scale CHP, for example. But they don’t talk about it, and I don’t really think CHP is going to prove terribly practical in the long term for residential applications given how increasingly effective the double whammy of solar and battery technologies are becoming. It can easily be done at the municipal level, where savings on hundreds of dollars a month in utility bills have a down-and-dirty line to, say, electoral popularity. But the Duggan Administration in Detroit has been too busy cleaning up messes of decades of disinvestment to focus on ambitious strategies to push the adoption of new technology in this realm. Departing Michigan Governor Rick Snyder isn’t going to do much with it, but it’s easy to conceive of ways utilities could work with both city governments and the state to get this sort of thing done.

DTE’s stock was up several points on improved earnings guidance by the end of the day Wednesday, equivalent to, you know, the cost of building several hundred new wind turbines.

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