Michigan Public Service Commission Approves Massive Battery Storage Projects Amid Rising Utility Rates

MPSC Greenlights 1,332MW of Battery Storage as Consumers Energy and DTE Seek Rate Hikes

LANSING — The Michigan Public Service Commission (MPSC) has approved six battery energy storage system (BESS) projects totaling 1,332 megawatts of capacity, marking a significant expansion of state energy infrastructure. The approval comes as Michigan's major utilities, Consumers Energy and DTE Energy, seek substantial rate increases to fund grid modernization and new capacity.

Six Major Battery Storage Projects Approved

The approved projects include:

• Big Mitten Energy Centre (450MW) in Huron County
• Monroe 1 Energy Centre (350MW) in Monroe County
• Fermi Energy Centre (200MW)
• Fish Creek Energy Centre (132MW)
• Cold Creek Energy Centre (100MW)
• Pine River Energy Centre (100MW)

The first three projects deliver a combined 1,000MW of capacity, satisfying the settlement agreement outlined in DTE Electric's approved integrated resource plan (IRP). The settlement highlighted the need for at least 850MW of energy storage to meet the utility's electric capacity requirements.

Data Center Connection

The last three contracts involve energy storage projects owned and operated by DTE Electric, which will support a 1,383MW data center being developed by Green Chile Ventures LLC in Saline Township, Washtenaw County. Green Chile Ventures is a wholly-owned subsidiary of technology company Oracle.

According to MPSC records, the data center-related BESS projects include an initial 332MW out of 1,383MW of company-owned energy storage facilities that Green Chile Ventures must develop to meet the data center's contractual demand.

Tolling and Self-Build Arrangements

The approval encompasses a 20-year tolling agreement with the Big Mitten Energy Centre in Huron County, along with self-build contracts for the Fermi Energy Centre Project and the Monroe 1 Energy Centre Project in Monroe County.

Under the approval terms for the data center, Oracle, through Green Chile Ventures, will cover the costs over 15 years to develop the energy storage for the project. DTE Electric will be responsible for developing, owning, and operating the facilities to support its grid, while Oracle will earn any market revenues generated from operating the facilities in the wholesale market.

Rate Hike Controversy

The MPSC battery storage approvals come amid controversy over utility rate increases. Last week, the MPSC approved a $276.6 million rate hike for Consumers Energy. DTE Energy received more than $1 billion in additional revenue from several MPSC-approved rate hikes. DTE's latest rate hike, approved in February, will collect $242.4 million more from their customers.

State Senator Michele Hoitenga (R-Manton) has continued to push back against the three-member MPSC and its gubernatorial appointments. She introduced Senate Bill 587 in September 2025, which would allow the legislature to hold oversight hearings for rate increases.

Hoitenga placed blame with the Democratic-controlled Senate for the bill being stalled. "By statute, the governor-appointed MPSC members are responsible for approving all rate increases. But wouldn't it be prudent for the legislature to hold transparent oversight hearings for any rate increases?" Hoitenga said.

MPSC Defends Data Center Approval

The MPSC also denied petitions for and motions to reopen proceedings on its approval of special contracts for DTE Electric to provide electric service for the Washtenaw County data center. The Commission determined that the Attorney General and others who requested a rehearing did not have standing to do so.

Additionally, they failed to identify any errors, new evidence, facts, circumstances that emerged after the hearing, or unforeseen consequences from the MPSC's order, which are required to justify a rehearing according to the MPSC's rules.

According to the MPSC, "The Commission's initial approval of the data center included the nation's strongest protections to prevent other customers from having to pay the data center's cost. Those protections include the utility agreeing to be responsible for costs it is unable to recover from Green Chile Ventures."

Additional protections included a minimum contract duration of 19 years, a minimum billing demand of 80% that requires the data center to pay a minimum of 80% of its contracted electric use even if actual use is lower, and a termination payment of up to 10 years' worth of minimum billing demand if the facility stops operating before the contracted date.

Data Center Impact Concerns

There is growing concern that data centers are driving up consumer electricity prices. Democratic Representative Alexandria Ocasio-Cortez and independent Senator Bernie Sanders have proposed a bill to impose a nationwide moratorium on data centers.

Even President Donald Trump, who supports accelerating data center development, admitted in a March meeting with technology companies at the White House that "They need some PR help because people think that if a data center goes in there, electricity prices are going to go up."

In the same month, the White House revealed its Ratepayer Protection Pledge. Major tech companies, including Amazon, Google, Meta, Microsoft, OpenAI, Oracle, and xAI signed this pledge, committing to develop, deploy, or purchase new generation resources. They also agreed to cover all costs for upgrading power delivery infrastructure at their data centers.

Broader Energy Context

The MPSC's decision on the data center included what the Commission described as the nation's strongest protections to prevent residential and other customers from subsidizing the facility's costs. The utility agreed to be responsible for costs it is unable to recover from Green Chile Ventures.

The total capacity of the battery storage projects approved for the data center exceeds the capacity of DTE Electric's 1,150MW Blue Water Energy Centre, Michigan's latest natural gas-fired plant, which was approved by the MPSC in 2018.

What This Means for Michigan Energy Policy

The MPSC's approval of these massive battery storage projects represents a significant investment in Michigan's energy infrastructure. The projects will help modernize the grid and provide backup power for increasingly critical facilities like data centers.

However, the timing of these approvals coincides with controversial rate hikes that have drawn criticism from lawmakers and ratepayers alike. As Michigan continues to balance the need for reliable energy infrastructure with concerns about utility costs, the MPSC's decisions will remain under scrutiny.

The battery storage projects approved by the MPSC include the initial 332MW out of 1,383MW of company-owned energy storage facilities that Green Chile Ventures (Oracle) must develop to meet the data center's contractual demand. The total capacity of the battery storage projects approved for this data centre exceeds the capacity of DTE Electric's 1,150MW Blue Water Energy Centre, Michigan's latest natural gas-fired plant, which was approved by the MPSC in 2018.