DTE Energy opposes Ann Arbor gas ban proposal – MLive.com

DTE-hired crews from Corby Energy Services prepare for gas line replacements in Ann Arbor's Old West Side historic neighborhood on Aug. 23, 2021.Ryan Stanton | The Ann Arbor News
ANN ARBOR, MI — DTE Energy is against Ann Arbor’s proposal to ban gas service for new buildings.
A representative for the Detroit-based utility, which provides gas and electric service in the area, said DTE remains committed to upgrading Ann Arbor’s electrical grid as the city aims to transition to all-electric buildings and electric vehicles, but DTE doesn’t support taking away anyone’s choice to opt for gas.
“We support the people’s right to choose their preference as far as a fuel source and having energy supply options remain open to all customers based on their preference,” said H.J. Decker, DTE’s director of gas sales and marketing.
“We’re not anti-electrification,” he added. “Obviously we’re the electric utility in this area as well, so we stand ready to serve.”
Ann Arbor officials are still mulling the gas ban proposal put forward by city staff as a way to meet the city’s A2Zero carbon-neutrality goals. Yet to advance to City Council, it’s under review by the Planning Commission, which is expected to take it up again March 7 after a Feb. 14 work session.
Ann Arbor wants to get off gas to help save the planet. Is it doable?
The proposal calls for prohibiting gas connections for all newly constructed buildings, as well as substantially renovated or expanded buildings, starting this year.
Though it would not require existing buildings to stop using gas, the city plans to offer rebates — on top of federal incentives — to help residents and businesses make the conversion and install electric appliances such as heat pumps that can be powered by renewable energy and not burn fossil fuels.
City officials maintain the climate crisis necessitates reducing greenhouse gas emissions, and heat pumps can be up to four times more energy efficient than gas furnaces.
Demonstrators gather to protest the nomination of a DTE representative candidate for a seat on the Ann Arbor Energy Commission outside Larcom city Hall, 301 E. Huron St. in Ann Arbor on Tuesday, July 5 2022. Shortly before the gathering, the city announced the candidate was no longer under consideration for the position.
Decker argues gas is still one of the safest, most reliable and affordable energy sources and heat pump systems can cost tens of thousands of dollars.
And since gas is still cheaper than electricity, going electric can increase home energy costs by about $1,000 a year, he said. Going solar, which the city promotes, can offset costs.
“We don’t mind and we stand ready to serve those who wish to be all-electric, and you will find new buildings and construction and customers that do want to be all-electric,” Decker said, adding DTE is working with them to make that happen, but some customers still would rather have gas.
“We handle thousands and thousands of these people wanting to install a generator, fire pits, patio heaters, things like that, which have been quite, quite busy over the last couple of years given COVID and everyone’s desire to be outdoors,” he said.
What about grid capacity?
Critics of the city’s gas ban proposal have questioned whether there’s enough grid capacity for all-electric buildings, but that’s not one of DTE’s concerns. The utility already is making big investments in power grid upgrades in the Ann Arbor area and plans to keep doing so as needed.
“We stand ready to meet the growth of electrical capacity if that’s what the city plans to do,” Decker said.
DTE has spent close to $200 million over the last five years on electrical infrastructure in Ann Arbor, including upgrades to substations and overhead and underground equipment to increase reliability and capacity, he said.
DTE Energy's Ann Arbor Service Center off Broadway Street on April 19, 2020.Ryan Stanton | The Ann Arbor News
“That’s ongoing,” Decker said, noting DTE is planning to invest about $30 million in substation upgrades off Broadway Street in 2024 and has a few other projects that are about $50 million apiece in the coming years as DTE works to modernize older electrical systems.
Those costs are rolled into DTE electrical rates and borne by all ratepayers.
Additionally, when a new development requires grid upgrades, such as an all-electric apartment complex or subdivision, the developer shares in the costs, which can add hundreds of thousands of dollars to the price of a large development.
Decker, who lives in Ann Arbor, previously spoke out before City Council in 2020 when council adopted the city’s ambitious A2Zero plan, which aims to achieve carbon-neutrality by 2030 in part by going out to the market and purchasing 100% renewable energy to power the community. Decker shared DTE’s concerns about that, telling city officials there were alternatives and DTE could develop a customized renewable energy solution for Ann Arbor and explore “green natural gas.”
DTE is still working with Ann Arbor on plans to create a 20-megawatt solar farm in Pittsfield Township. The project has been delayed as the city contemplates how to move forward.
DTE also has been working with the development team behind the solar-powered, all-electric neighborhood called Veridian that has broken ground in Ann Arbor to make sure the right electrical infrastructure is in place to support it.
“If they choose to go that route, we totally support them,” Decker said of developments going all-electric.
A conceptual view of the Veridian development by Thrive Collaborative in Ann Arbor. Veridian was designed by Union Studio Architecture and Community Design with renderings by McLennan Design, landscaping by InSite Design Studio, ecological design by Biohabitats and engineering by Midwestern Consulting.Thrive Collaborative
Ann Arbor resident Matt Grocoff, a member of the Thrive Collaborative development team behind the 99-unit Veridian development, said DTE has been very supportive.
Veridian is the type of neighborhood that is going to be required in the future, Grocoff said, explaining his team has worked with DTE on a non-traditional electrical grid solution for a net-zero community with lots of solar and battery storage.
“We’re what we call grid beneficial, so rather than being a burden to the grid, we’re creating a buffer from the grid,” he said, explaining how Veridian homes could rely on battery-stored energy during peak demand and grid outages.
Grocoff supports Ann Arbor’s gas ban proposal to push other developments to follow his team’s lead. As long as conventional builders still believe gas is essential — and Veridian proves it isn’t — there’s no chance developers will commit to voluntary decarbonization, he said.
“Every new gas line locks us into decades more of fossil fuel addiction. The world has no time left for new fossil fuel infrastructure,” he said. “We’ve got tens of thousands of homes to retrofit in Ann Arbor. Every new building that Ann Arbor builds with fossil gas must immediately be added to the already massive list of buildings that we must retrofit.”
‘Definitely we do have issues’
In addition to environmental concerns, Ann Arbor officials point out research shows gas combustion indoors can have negative impacts on indoor air quality and people’s health.
There also are occasional explosions from gas appliances and gas lines, such as the furnace explosion in 2020 that blew out an Ypsilanti Township home’s wall and left a homeowner with second-degree burns, and cases of carbon monoxide poisoning, such as a maintenance worker found dead in a gas boiler room at an Ann Arbor hotel in November. That same month, a Rochester Hills couple was found dead in their home where their gas furnace was determined to be the likely source.
Ann Arbor’s Renters Commission and City Council Member Jenn Cornell, D-5th Ward, are now discussing a possible new ordinance to require carbon monoxide detectors in all rental units in the city because of the dangers of gas.
DTE-hired crews from Corby Energy Services prepare for gas line replacements in Ann Arbor's Old West Side historic neighborhood on Aug. 23, 2021.Ryan Stanton | The Ann Arbor News
Gas leaks around town also can cause scares. When a gas line ruptured near a downtown Ann Arbor courthouse in 2018, officials feared the risk of explosion and issued public alerts.
“Definitely we do have issues from time to time,” Decker said. “I would say, on whole, it’s rather safe. I mean, electricity is not an energy source without its own dangers as well.”
While there aren’t a lot of stories of electric heat pumps causing disastrous problems, Decker said there just aren’t a lot of homes with them yet.
“You could probably count on two hands how many fully electric homes are in the Ann Arbor area, and you probably don’t need too many more hands to count how many are in our entire service territory,” he said. “You’re talking about a technology that is relatively unproven and unadopted for the most part.”
Gas is safe when appliances are properly serviced and maintained and there’s proper venting, Decker said.
“A carbon monoxide accident usually happens from faulty equipment,” he said.
Demonstrators gather to protest the nomination of a DTE representative candidate for a seat on the Ann Arbor Energy Commission outside Larcom city Hall, 301 E. Huron St. in Ann Arbor on Tuesday, July 5 2022. Shortly before the gathering, the city announced the candidate was no longer under consideration for the position.
DTE maintains natural gas is a relatively clean-burning fuel and there are other ways to reduce emissions, such as moving away from vehicles with internal combustion engines. That’s the single biggest source of emissions in the U.S., Decker said, noting DTE has programs to support the transition to EVs.
“We recognize the urgency and the issue at hand,” Decker said of climate change, pointing out the utility is moving away from coal. “Our CEO has said that it’s one of the defining issues of our generation.”
DTE’s long-range plan calls for moving from an energy mix that is 45% coal, 19% natural gas, 19% nuclear, 14% renewable and 3% storage in 2023 to a portfolio in 2042 that will be 62% renewable, 20% natural gas, 12% nuclear, 6% storage and 0% coal. The utility’s goal is to be carbon-neutral by 2050.
“Now, is that going to involve absolutely no natural gas? Probably not,” Decker said. “Natural gas, at least on the power gen, is very useful in balancing things like intermittent renewable sources that do not run on every day at every hour of the year. But that being said, we are on that path to really reducing those emissions.”
Decker noted he voted for Ann Arbor’s climate-action tax that will fund, among other things, rolling out more EV chargers.
“That’s something we very much support,” he said.
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