Tiny Michigan nonprofit is taking on DTE — and it could have huge impact on the company

DTE is one of the nation’s biggest utilities with headquarters in a glass-and-steel tower in downtown Detroit. It sells electricity to millions of Michiganders.

Soulardarity is a nonprofit group 7 miles away, with two full-time employees and headquarters in an old house, across from a boarded-up motel in a high-crime area of Highland Park. The odd name? It’s a play on soul, solar and solidarity.

Not long ago, the giant DTE and tiny Soulardarity went toe-to-toe. Others were there, too — major environmental groups, solar energy businesses and the Union of Concerned Scientists — all taking on the utility founded in 1903 by Thomas Edison.

Everybody was polite and wore nice clothes. Still, when the verbal dust settled, a judge issued a 190-page opinion that surely set the big utility back on its haunches. It has Soulardarity’s folks feeling like they’ve made a difference.

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The tussle isn’t over. The judge’s opinion, on Dec. 23, is a series of recommendations, not final. Now, the three-member Michigan Public Service Commission has until Feb. 20 to issue a final ruling in the historic case, which will largely decide what's to be DTE’s 15-year road map — formally called the “Integrated Resource Plan.” Although the commissioners have the last word, they usually take a judge’s opinion seriously.

If they do this time, it will mean DTE must change the plan significantly. To Soulardarity, that could include paying more attention to low-income communities and communities of color, bending to the fightin’ words on posters in Soulardarity’s sparsely furnished old house: “energy democracy.”

However the plan turns out, it will decide how millions of Michiganders get their power and shape how much they pay for it, for years to come. The case is historic because it comes at a time of change sweeping the energy world — as coal goes the way of buggy whips; as rugged individualists seek to generate their own power with rooftop windmills and solar cells; and as cheap natural gas floods the marketplace, tempting sharp-penciled engineers to push wind, solar and biofuels into a corner.

For average Michiganders, those who can’t afford a $7,000 generator to kick on if lights go out in a storm, and especially those with low incomes, building more “energy democracy” into the next 15 years of electric power is essential, says Jackson Koeppel, the mild-mannered, 27-year-old co-founder of Soulardarity.

“We’re really supportive of the judge’s recommendation that highlights the issues of community health and community ownership,” Koeppel says.

He complains that DTE “did not even consider community solar,” the idea that people can band together to fund solar power as a group, and then cut the cord at least part of the time to DTE’s wire grid, Koeppel says.

As strange as community solar may sound to most electric customers, Koeppel knows firsthand that it works. He can step outside his office to see it, 100 yards west of Soulardarity on a side street in Highland Park. There stands a solar-powered streetlight, paid for by Soulardarity’s fundraising, one bake sale and mini-grant at a time.

The genesis of that solar-powered streetlight was a stunning month in 2011 when DTE removed 1,300 streetlights from Highland Park because, the utility said, the city owed $5 million on its light bill. Surrounded by Detroit, Highland Park is 95% black and mixed-race with 11,000 residents — roughly the number of employees at DTE. Its median household income is well below that of Detroit, vying each year with Benton Harbor for lowest in the state.

When DTE packed up in 2011, it left 300 lights standing on Woodward Avenue and installed 200 new ones at key intersections on Woodward, cutting the city’s monthly bill by 75%, utility officials said. Yet, after that, Highland Park had no light on side streets, raising fears about crime and traffic safety.

DTE removed the streetlights

That’s when Koeppel’s predecessor arrived from Ferndale, flush with moxie from breaking Guinness records for hosting the longest live concerts in history, fundraisers to aid laid-off autoworkers, each held inside a Ferndale coffee shop called AJ’s Music Café. With a landlord demanding too much rent, café owner A.J. O’Neil announced he was done with the café and ready for a new challenge.

He moved into the battered old activities center of St. Benedict Church in Highland Park, learned of the streetlight crisis, then coined the term Soulardarity for his new crowdfunding effort: buying and installing solar-powered streetlights.

The first one went up in 2012, about the time that Koeppel arrived on an internship from Oberlin College in Ohio. Since then, O’Neil has moved on to market his “Detroit Bold” coffees online and in metro Detroit stores, Koeppel dropped out of college to head Soulardarity, and six more solar-powered streetlights went up.

“We’ve also installed about 200 smaller solar lights on businesses and churches, through our bulk-purchase program,” Koeppel says.

Along the way, he pushed the boundaries of Soulardarity’s mission, from getting Highland Park’s streets lit without DTE to taking on the big utility directly last year, in front of the judge acting for the Michigan Public Service Commission.

Responding to a request from the Free Press, DTE said that the company respected the judge's opinion as part of the process for gaining approval of DTE's first long-term Integrated Resource Plan, or IRP. It said, "As we continue to proceed through the IRP process, we remain committed to doing as much as we can, as fast as we can, to provide the communities we serve with more clean energy that is affordable and reliable.”

In its plan, DTE acknowledged concerns about climate change and pledged to reduce its carbon emissions by 80% by 2040. Koeppel pointed out in court that Michigan’s other big utility, Consumers Energy, had promised 90% by that date.

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DTE further said it would comply with all state and federal environmental laws, as part of its duty to protect public health. Koeppel and others said that wasn’t good enough. The judge concluded in her recommendations to state regulators that DTE should do more in future plans to assess how its operations affect public health.

DTE is not alone in jumping through these hoops. Jackson-based Consumers Energy was the first utility in Michigan required to submit an Integrated Resource Plan, a complex road map that outlines how a company will meet the electric needs of its customers for the next five, 10 and 15 years.

How things turn out for DTE as well as for the state’s other utilities in this painstaking process is vital to the future of Michigan and Michiganders, said Janice Beecher, a political science professor at Michigan State University.

“It’s so important to get this right because these services are essential to everyone, rich and poor, not just for economics but also for the environment, for public health and safety. Nobody has a crystal ball, so this plan needs a tremendous amount of analysis and planning,” said Beecher, who heads MSU's Institute for Public Utilities at Michigan State University, a nationally known think tank and training site for utility regulators.

This era's dirty word

Whose utility bills go up, and when they go up, and by how much, will depend on what mix of power sources and delivery options end up in the plan. Deciding on that mix, for years to come, are government bureaucrats whose job is characterized by some politicians as a dirty word: regulation.

Yet, regulating DTE and other utilities is not corralling the free market and burdening business, Beecher says. It’s creating in a Lansing courtroom and, ultimately, inside the Michigan Public Service Commission, an artificial form of what utilities usually don’t have: competition.

“People can ask, 'why does this matter?' Utilities have characteristics that tend toward being a monopoly," Beecher said.

“You and I don’t want a whole bunch of competitors bringing wires and poles down our street. We only need one electric company. But when you have a monopoly, you worry about the problem of monopoly power. You’re thinking ‘Gosh, if I don’t have any other choices, could that monopoly take advantage?’

“So, the whole idea of regulation is to substitute for the competitive market. If you were in a normal business, your competitors make you efficient. They drive you to keep costs down. Under a monopoly, the commission is there to provide a similar set of checks and balances,” Beecher said.

She added: “Regulation is not anti-utility. It’s really about holding utilities accountable to all of us.”

DTE's better angels

DTE regularly announces major commitments to cutting air pollution, and to using renewable energy sources such as wind and sunlight. It made the case for continuing those commitments in its long-range plan.

The company repeated its pledge to speed up its timetable for cutting carbon emissions — the “greenhouse gases” blamed for climate change — by accelerating its phaseout of coal-fired plants. The faster phaseout would bring on a mix of high-efficiency natural gas generating units, as well as more renewable sources — wind and solar generation.

In addition, DTE pledged to be highly efficient with the energy it uses. In its plan before to the judge, DTE said it would, by 2021 to 2024, achieve a level of energy efficiency equivalent to that of the two most efficient utilities in the country.

DTE reiterated its intention to shut down its River Rouge, Trenton and St. Clair coal-fired plants and build a $1-billion, natural-gas-fired plant in St. Clair County, near its Belle River coal plant, which itself would close in 2030. That schedule would cut DTE’s carbon emissions 34% by 2022, 50% by 2030 and 80% by 2040, when compared with its emissions in 2005.

n September, six months after filing its long-term plan with the state, DTE pledged it would work to achieve “net zero” carbon emissions by 2050. To get there, the company said it would use a range of new technology — much of it not fully developed — and DTE said it might also need significant changes in government regulations to achieve the goal. The pledge is not a part of the utility’s new long-term plan being considered by the Michigan Public Service Commission.

DTE told the judge that it would delay the shutdown of one generating unit at River Rouge, originally planned for 2020, by converting it from coal to recycled industrial gasses, which would provide extra backup power in the area and give more time to the city of River Rouge to prepare for lost tax revenues when the plant closes. As part of its transformational phaseout of coal, the company’s big coal-fired generating plant at Monroe would be retired by 2040.

None of those moves would cause rate hikes for DTE's customers, officials pledged last year, although other aspects of the long-range plan will affect rates. By how much was a matter of great contention. The judge blamed DTE for a major error in projecting future costs, "such that the actual rate impacts of the (plan) cannot be determined here."

By 2030, the plan would leave customers of the nation's seventh-largest energy utility getting about 20% of their power from a new, high-efficiency natural-gas plant; about 20% from nuclear, thanks to the existing Fermi 2 plant near Monroe; and the remaining 60% from some as yet undetermined mix of wind, solar power and coal. After that, coal would go down to zero by 2040, as renewables go up. But how much they go up, and will it be enough to offset needing another new natural gas plant, would depend on the pace of technology, including whether mega-sized battery storage becomes practical for entire cities — because the wind doesn't blow all the time, nor does the sun shine all the time. Still, the company said its solar and wind sources are sure to grow.

"We will triple our renewable energy in the next 10 years," said DTE spokeswoman Randi Berris. On that path, DTE has built 14 successively larger projects to harness the wind. In early 2018, DTE launched a windmill project in areas around Alma and Mount Pleasant that's the largest in Michigan, producing "green power" equivalent to taking 63,000 cars off the road, company officials said. Due to come on line this year are three more DTE wind parks, including two more big ones in mid-Michigan.

Many utilities in the Midwest have said solar holds less promise in this region of cloudy days. DTE is nonetheless testing its potential. The company has more than 30 solar parks, with plans to increase that capacity by 25% over the next five years. Its Lapeer Solar Park is the largest solar generator in the state.

As progressive as it all sounds, critics found much to dislike in DTE's long-range plan. Across the country, as major utilities switch from coal to natural gas, environmentalists are seeking greater use of wind and solar while demanding a halt to new gas plants.

For Soulardarity, DTE's plan fell short in addressing what the nonprofit told the judge it called "energy democracy."

Power to the ‘hood

"Energy democracy" speaks to a soulful concept — that a utility is not just a company selling products; it’s a tool of society that should serve society, said Shimekia Nichols, deputy director of Soulardarity.

As such, DTE needs to do more to help low-income customers, Nichols said. One example? Well-off customers can shrug off losing all the food in their refrigerators or having to buy a space heater, if a big storm knocks out the power for a week. Not low-income consumers, she says.

“I believe, if the infrastructure is unreliable or archaic, the average person should not have to foot the bill for that. But all you can get is $25,” Nichols says, citing the maximum rebate DTE pays to customers who can prove they lost food or had other expenses from an outage.

Inside Soulardarity headquarters, Nichols sits at a salvaged table, wearing her coat against the chill because the heat is turned down. There’s a poster on one wall of Malcolm X. On another wall is a whiteboard with a schedule of meetings, objectives and deadlines for 2020, scribbled in neon-green cursive.

Nichols, 37, has two young sons, ages 2 and 7. She says pushing DTE to change its plan could someday lead to more job opportunities for them because installing community-owned solar and wind systems in Highland Park would create more jobs than building giant natural gas plants dozens of miles away. Shimekia’s job as communications coordinator, working toward “energy democracy” for the last three years, at first took her friends and relatives by surprise, she says:

“Initially, you get a dull response — like, ‘You make money from that?’ But as we do outreach and start getting a response from our campaigns, they’re excited. Now, I’m able to tell my own mom about why there’s an energy monopoly here.”

The state's complex process required DTE to plan all the way to 2035. In the judge’s recommendations, she recommended that DTE address 15 key issues, starting with its decision to present "four possible pathways beginning in 2025." The judge said that was too vague to measure up to state law. In addition, the judge said she sought a plan that’s more efficient, one that's more detailed on wind and solar power, as well as more precise with numerous projections. Her last request? That DTE address “significant errors and omissions” in the existing plan by returning with an updated plan in just 24 to 30 months.

Is it possible that David on a shoestring took on a Goliath of energy and won? That remains to be seen. Of course, Soulardarity was just one critic. Last week, DTE filed a detailed response to the judge's opinion, aimed at swaying the final decision that rests with three commissioners. DTE's legal staff methodically disputed each of the judge's adverse conclusions, including her contention that DTE improperly calculated the all-important impact of its long-range plan on future electric rates that could someday be charged to customers.

What’s certain is that DTE entered a sophisticated field of contention — a courtroom where billions of dollars were at stake — to face off against a slew of critics. It wasn’t only Soulardarity that took on the immensely profitable utility.

More than a dozen groups, many of them coalitions representing even more groups, sought to influence DTE’s plan. Also joined in the epic debate: Michigan Attorney General Dana Nessel, who has been more outspoken on utility issues than any state attorney general since Frank Kelley left office in 1999. And more than 3,000 Michiganders weighed in with written comments. Finally, there was the expert testimony of regulatory staffers themselves, some of about 200 state employees at the Michigan Public Service Commission.

In the middle of the scrum — up against DTE’s small army of lawyers, engineers, financial analysts and economists — a tiny nonprofit with an odd name held its own.

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Contact Bill Laitner: blaitner@freepress.com