Utility in advanced discussions with hyperscalers for more than 3GW of new load.
Detroit-based utility DTE Energy is in talks with data centers representing up to 7GW of potential new capacity around Michigan.
“We are in advanced discussions with multiple hyperscalers for over 3GW of new load, and are having ongoing discussions with multiple other data center operators for an additional 4GW,” DTE president and CEO Joi Harris said during the company’s Q2 earnings call.
The “advanced discussions” are with hyperscale developers who have already secured the necessary land positions, zoning pathways, and local community support needed for smooth development.
According to Harris, “the remaining 4GW in the pipeline either have confirmed access to land or are nearing finalization of land agreements.”
To meet the new capacity, DTE plans to utilize “a combination of existing generation capacity and new energy storage solutions. And longer term, additional data center loads will require incremental investments in new baseload generation,” Harris said.
She went on to contend that the company is “well-positioned to meet the potential surge in demand from data centers. This represents significant upside to our plan, offering opportunities for additional investments in new generation capacity while supporting our commitment to customer affordability.”
The growth in capacity from new data centers in Michigan has been induced by favorable tax breaks for data centers in the state, in addition to excess capacity. The tax breaks were finalized last year, and exempt operators that invest $250 million or more in digital infrastructure from sales and use taxes on equipment until at least 2050.
Harris said that “there is some urgency on the part of the data center providers to begin the construction of their facilities by 2028 so that they can take advantage” of the tax breaks.
The company is currently advancing a $30 billion five-year investment plan, with $24bn earmarked for DTE Electric, including $10bn on grid investments to upscale the transmission grid. According to Harris, the near-term load ramps driven by data center growth will mean that DTE will have to begin construction on new storage assets in 2026.
At the back end of the five-year plan, the company will have to start constructing new baseload generation to meet the spike in new demand, which is expected to be primarily gas combined cycle capacity.
The utility is currently retiring the bulk of its coal fleet, already decommissioning eleven units across its coverage area. It plans to repurpose its Trenton Channel coal plant into a battery storage facility in 2026. The utility's final coal-powered plant is expected to be retired no later than 2032. As of 2022, the company derived 54.16 percent of its electricity from coal-powered plants.
The utility serves approximately 2.3 million residential and business customers throughout Michigan. It also has a state-regulated natural gas arm, which provides natural gas to 1.3 million residential, commercial, and industrial customers across Michigan.
Currently, Switch is the largest player in the state, with 365, Bedrock, and Sentinum also present. In November 2024, Switch announced intentions to expand its data center in Grand Rapids, Michigan.
In February 2025, Hyperscale Data reported it was set to scale its Michigan data center to 300MW, and later 340MW.
In October 2024, Microsoft acquired 316 acres of land outside Grand Rapids, Michigan. However, progress on the project has so far stalled, with no plans shared by Microsoft with the local planning officials.
