PRESS RELEASE FROM THE MICHIGAN PUBLIC SERVICE COMMISSION:
The Michigan Public Service Commission Tuesday, approved a certificate of public convenience and necessity for a subsidiary of DTE Energy Co. to convert northern Michigan natural gas pipelines from unregulated wet gas gathering lines to regulated dry gas transmission lines that would serve as an additional supply source for areas of northern Michigan, adding a layer of resilience in the supply of natural gas for DTE Gas Co. customers in the northern Lower Peninsula.
The MPSC approved DTE Michigan Lateral Co.’s (DMLC) application (Case No. U-20894) under Public Act 9 of 1929 to convert the existing natural gas gathering pipelines, a $28 million project, and to build, operate and maintain two connector pipelines – the $7 million Rogers City Connector and the $13.9 million Norwalk Manistee Connector – between the existing system and DTE Gas transmission facilities serving customers in Manistee, Traverse City, Alpena and Rogers City, and surrounding areas.
Approval of the project provides redundancy to areas of the state that have, at present, only a single source of natural gas supply and will increase the resilience of DTE Gas’s transmission system, the Commission found. Adding redundancy and diversifying sources of natural gas supply were key recommendations of the MPSC’s 2019 Statewide Energy Assessment, a comprehensive review of Michigan’s energy systems undertaken at Gov. Gretchen Whitmer’s request after a statewide energy emergency declared during a polar vortex cold snap in January of that year. A fire at a Macomb County compressor station threatened to disrupt delivery of natural gas in Michigan, underscoring the need for diverse supply sources.
The Commission also approved a 20-year contract between DMLC and DTE Gas for firm transportation services on the converted and new pipelines, but the Commission ordered DMLC to file recalculated rates minus contingency costs within 30 days, due in part to the fact that DMLC was an affiliate of DTE Gas at the time the agreement was struck. Costs for the pipeline project will be recovered through rates DTE Gas will pay to DMLC for use of the pipelines. A determination regarding the recovery of these costs from DTE Gas customers will be made in a future DTE Gas case.
The Commission conditioned its approval on the completion of an alternative natural gas gathering system proposed by Lambda Gathering LLC to replace the system DMLC will convert, providing transport for 10 natural gas producers in the area, pending in Case No. U-21091, and on DMLC receiving all necessary permits and easements.
In addition to DMLC, the Michigan Department of Attorney General, North Bay Energy LLC, and Riverside Energy Michigan LLC intervened in the case. MPSC Staff also participated.
Separately, the Commission also approved DTE Energy Co. subsidiary DTE Michigan Gathering Co.’s request to implement new delivery point charges reflected in an Aug. 30, 2017, agreement with DTE Gas Co. (Case No. U-20994).
MPSC APPROVES DTE GAS CO. DEFERRAL OF COSTS RELATED TO TRAVERSE CITY-ALPENA REINFORCEMENT PROJECT
The MPSC has approved DTE Gas Co.’s request (Case No. U-21102) for a one-time regulatory asset to defer transportation expenses related to its Traverse City-Alpena Reinforcement Project (TCARP) once contracts between DTE Gas and DTE Michigan Lateral Co., a DTE Energy Co. subsidiary, and Saginaw Bay Pipeline Co. are approved by the Commission in cases U-20894 and U-20993, respectively. TCARP is designed to provide a redundant supply of natural gas, improving reliability for about 91,000 DTE Gas customers in northern Michigan.