28 takeaways from state audit of DTE Energy, Consumers Energy equipment

DETROIT – State officials did an audit of the equipment used by DTE Energy and Consumers Energy and found several issues that contribute to outages and high costs.

The Michigan Public Service Commission took a deep dive into the the state’s two largest electric utility companies. DTE and Consumers serve about 4.1 million customers.

Officials launched this third-party audit in 2022 when several widespread outages caused frustration throughout Michigan.

Those results were publicized Tuesday, Sept. 24, 2024.

“This audit is the first of its kind in Michigan, exploring the equipment and operations of the two utilities that provide electricity to more than 80% of Michigan electric customers,” MPSC Chair Dan Scripps said. “It provides an unprecedented examination of the condition of the electric grid serving those customers, an incredibly valuable tool as the MPSC continues its work to reduce power outages, shorten the time for restoration of power after storms, and keep residents safe when power lines come down.”

Scripps said the results of the audit suggest both companies need to put greater emphasis on preventing outages, not reacting to them.

“The results from this audit will inform our next steps and strategies to make the electric grid more resilient and reliable,” Commissioner Katherine Peretick said. “It provides unprecedented transparency into the utilities’ infrastructure and operations and allows us to make better decisions to improve service and affordability for Michigan customers.”

“We’ve not had this deep of a look at the functioning of the electric grid for these two utilities -- examining the age and condition of equipment, the effectiveness of their maintenance and tree-trimming schedules, and comparisons to similar utilities to see how DTE Electric and Consumers stack up,” Commissioner Alessandra Carreon said. “It will take time for both utilities to make the necessary investments to improve reliability. The data from this audit will help shape strategies to prioritize the deployment of the investment needed to reduce outages from severe weather, restore power faster when it goes out, and significantly lower the risk of the public coming in contact with downed power lines.”

Here are some takeaways from the DTE audit:

1. DTE’s average interruption duration in 2022 and 2023 was worth than average, meaning it took longer to restore service during major event days and on regular days.
2. About 45% DTE customers are served by an ungrounded 4.8 kilovolt system that takes more time to find and fix problems than more modern systems.
3. The 4.8 kilovolt system exposes workers and the public to “direct higher risk of electric shock hazards.”
4. Almost 40% of DTE’s 4.8kV substation transformers were installed between 1924 and 1960.
5. Some of DTE’s 13.2 kV transformers date to the 1960s, which makes them older than comparable utility companies’ transformers.
6. The study found that “periodic excessive loadings leave DTE Electric with a high substation transformer failure rate.”
7. DTE doesn’t track the age of its service transformers and, in some cases, doesn’t track the number of customers served by transformers.
8. About 40% of DTE’s circuit breakers and re-closers were installed between 1930 and 1960.
9. The legacy oil circuit breakers need more intense maintenance and perform worse than modern gas circuit breakers.
10. More than half of DTE’s overhead primary lateral lines are in back lots, including brush-filled Detroit alleys and older suburbs.
11. It costs more to maintain those circuits and trim trees near them because it’s difficult to navigate the necessary equipment.
12. DTE tries to trim trees around lines every five years, but the effective cycle is currently 5-7 years, the study found. Utilities with shorter cycles have fewer outages.
13. More than 13% of DTE customers experienced four or more interruptions in 2023.
14. The number of DTE customers who experience four or more interruptions each year is “greater than usually acceptable for utilities.”
15. Almost 45% of DTE customers experienced interruptions of eight hours or more in 2023.
16. The number of DTE customers who experience more than eight hours of interruption each year is “greater than usually acceptable for utilities.”
17. About 88% of all DTE customer outages are caused by the distribution circuits.

Here are some takeaways from the Consumers audit:

1. Consumers’ average interruption duration in 2022 and 2023 was worse than average, meaning it took longer to restore service during major event days and on regular days.
2. Consumers operates an “unusually high” number of different low-distribution voltages because of mergers with legacy utilities over the years.
3. This inconsistency requires Consumers to use isolating transformers to connect circuits with different voltages.
4. Diverse and non-standard substation and circuit assets require mobile substations and additional inventory beyond what’s needed for standard voltage substations and circuits.
5. About 62% of Consumers’ low-voltage distribution poles are in the small-diameter class, which means they’re more susceptible to breaking in storms.
6. As many as 18% of Consumers customers have electric distribution infrastructure in “difficult-to-service back lots.”
7. Consumers tries to trim trees around lines every 5-9 years, but in practice, those trees are trimmed about every 10 years because of a backlog. Utilities with shorter cycles have fewer outages.
8. More than 10% of Consumers customers experienced four or more outages in 2023.
9. More than 25% of Consumers customers had outages of eight hours or more in 2023.
10. The use of “weather” and “unknown” as cause codes for outages “is imprecise and masks what actually causes outages,” the study says.
11. Consumers’ low-voltage distribution lines have “consistently caused” the most System Average Interruption Duration Index minutes -- about 87%.

DTE Energy and Consumers Energy released statements in response to the audit. They can be read below.

“We remain laser-focused on delivering on our commitment to our customers — reducing power outages by 30% and cutting outage time in half by 2029.

“To meet that commitment, as well as the customer service standards set by the Michigan Public Service Commission, we’ve been making significant investments as part of our accelerated plan to quickly transition to a smarter grid, aggressively trimming trees, updating our existing infrastructure and rebuilding significant portions of the grid.

“We appreciate the audit team confirming that DTE’s proposed investment plan will deliver the dramatic improvement in reliability that our customers demand and deserve in the next five years as well as recognizing the talent and experience of our team. They also point out that our plan is both ambitious and aggressive, and we accept that challenge.

“We are always looking for ways to improve our processes and programs and thank the audit team for recognizing our progress, as well as providing recommendations on improvements we can make to better serve our customers.

“We are currently reviewing the full report and will provide a formal response through the regulatory process. We look forward to continuing to work with the Michigan Public Service Commission on ways to provide our customers with cleaner, more reliable, and affordable energy.”

DTE Energy

“The MPSC audit on our company’s storm response has been constructive, and we appreciate the deep experience and expertise Liberty brought to the process. Consumers Energy proactively provided data, information and access to our facilities to Liberty. Michiganders are facing more severe and frequent storms, which is why we announced our Reliability Roadmap in 2023, a blueprint for fewer and shorter outages including no customer going more than 24 hours without power.

Our investments are focused on the customers we serve by adding technology, burying power lines and clearing trees. Consumers Energy will continue to advocate to build a smarter and stronger power grid that serves Michigan reliably 24/7.”

Consumers Energy

Click here to read the full release from MPSC.