Warren mayor at odds with utility over LED rate change

By: Brian Louwers | Warren Weekly | Published January 23, 2015

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WARREN — Mayor Jim Fouts has called on state officials to short circuit part of a recent utility rate increase request that he said would discourage further efforts by municipalities to ditch old-style street lighting for newer LED technology.

Buried deep within DTE Energy’s voluminous legal filing with the state in December, in which the company laid out its case for the first energy rate hike in four years, is language that Fouts said would “discourage energy-saving LED streetlights and encourage the existing streetlights that produce a lower quality light while producing harmful chemicals that threaten the environment.”

Fouts released a statement Jan. 22 attached to a copy of a letter sent to members of the Michigan Public Service Commission. He called on the commission to support Warren’s move toward “energy optimization efforts” that would be put on hold in light of DTE’s recent request for a 3 percent rate increase.

“DTE”s approach threatens progress made by the City of Warren and other municipalities that have taken the lead on LED street lighting conversion,” Fouts said in the statement. The mayor said the utility’s proposed rate case with the state would incentivize municipalities to “stand pat and utilize existing incumbent technologies.”

Fouts said the increased rates would cost residential customers 3.2 percent more each month; an average of about $3.

DTE Energy released a statement late Jan. 22 in response to the mayor’s letter.

“Our electric rate case is based on the cost of serving various types of customers — residential, commercial and industrial, as well as communities that depend on us for street lighting services,” the company said in the statement. “Since we started offering LED street lighting four years ago, communities have been charged an experimental rate based on estimated costs and our limited operating history. As we gained more experience with the LED technology, we changed the pricing to reflect a more complete understanding of the costs associated with that type of lighting. The rate case filed last month reflects our current understanding of the costs of this emerging technology.

“Overall, our street lighting rates will increase an average of about 1 percent, but Warren, based on its current lighting portfolio, will see only a slight change in its overall lighting bill.”

The company added, “DTE Energy was one of the first utility adopters of LED street lighting and we’re not trying to discourage new technologies. In fact, the proposed rates will continue to encourage energy-efficiency efforts by municipalities in partnership with DTE to convert current lighting technologies to more energy-efficient technologies such as LED. Communities that move to LED lighting will continue to experience significant savings in their lighting bills, despite the proposed rate changes.”

Fouts also called on the Michigan Municipal League to stand behind its member cities and towns by opposing the requested rate increase.

He called DTE’s 639-page filing with the Michigan Public Service Commission “a deliberate hindrance to the City of Warren, Detroit-Metro Area, and the State of Michigan’s energy optimization efforts,” and said the changes would “make LED conversions financially noncompetitive for the City of Warren and other municipalities.”

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