5 things we learned from our sit-down with DTE Energy CEO Jerry Norcia

Detroit-based DTE Energy, along with utilities around the country, is going through a "fundamental transformation" in how it produces and delivers power, according to its CEO and Chairman Jerry Norcia.

This is happening at a time when weather patterns are worsening, with the number of days that wind speeds were above 40 mph increasing and 11 back-to-back storms and four tornadoes in 2021, Norcia gave as examples.

"These storms are no longer historic," Norcia said. "They might have been 10 or 15 years ago, but now they are becoming our new normal, where every two or three years we're going to get hit with these very significant severe weather events."

Norcia sat down with several members of the Detroit Free Press staff Tuesday to talk about how the utility is building a better grid with the aim of reducing the amount of time customers are without power.

He also answered a wide range of questions from the Free Press. Below are five key takeaways:

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1. What DTE is doing to reduce the frequency and duration of outages: By the numbers

• Automation: DTE is putting smart devices on the grid, which allows the utility to "isolate outages and reroute power very quickly," Norcia said. In the next five or six years, DTE is going to put 10,000 of these devices on the grid, which allows the utility to restore power more quickly, he said. DTE's system is at about 10%-15% automated today, Norcia said, with the goal of getting close to 100% automated in five to six years.

• Tree trimming: DTE is five years into a seven-year "aggressive" tree trimming program. "At that point, we will have gone through the entire system and trimmed it to the new standard. Where we're doing that, we're seeing a 60-70% improvement in reliability," Norcia said.

• Pole top hardening: The equipment at the top of the poles needs to be rehabilitated every five to seven years, Norcia said.

• Replacing/undergrounding infrastructure: DTE wants to replace circuits and put some underground. A third of the company's infrastructure is underground. The rest is up in the air and parts of it are outdated, meaning it was built in the first half of the last century and of a lower voltage. That older infrastructure is found in cities like Detroit, Ann Arbor, Grosse Pointe, Birmingham, Royal Oak and Dearborn. DTE plans to replace about 16,000 miles of this circuit that causes the most trouble day to day and during storms. “That system needs to be replaced and that's going to take about 15 or 20 years to replace that," Norcia said. "While we're doing that, we're going to look really hard at how much of it we can underground."

2. What DTE is doing in Detroit

Detroit might be one of the spots where the drilling happens. Norcia said DTE is looking to partner with the city of Detroit to rebuild 5 miles of circuits and place them underground. The goal is to start doing the work over the next 12 months. It’s in the early stages, but the company has some locations in mind and is planning on working with the city to determine where it would happen.

"The mayor is completely supportive of DTE's plans to begin burying some of its powerlines," John Roach, a city spokesperson, said in an email. "This is something the mayor has been pushing for to help make the city more resilient to weather-related power outages. There is no cost to the city for DTE to bury its lines."

3. Storms will likely cause more power outages. Here's what DTE is doing to provide relief.

Norcia acknowledged that the $35 a day credit for eligible customers who lose power is not enough to cover the losses and costs people incur, such as for food and hotel rooms. He said DTE offered the credit before the Michigan Public Service Commission (MPSC) officially enacted the increased amount earlier this year.

He also pointed to a $3 million contribution to the United Way for Southeastern Michigan for $100 grocery vouchers to low-income customers, based on the United Way’s database of DTE customers whom the nonprofit has provided utility assistance to. The United Way called low-income customers to offer the voucher to help address the loss of power for several days, Norcia said.

“People who have resources have different options ... you can go to a hotel, you can go to a restaurant, but if you're sitting there and you're not making a lot of money and you have limited resources, those are the people that suffer the most through those events,” Norcia said.

He said DTE is advocating for a statewide policy to create a relief fund for low-income customers who are affected by multiday outages.

4. Residential rates are not going down anytime soon

Asked whether he could see residential rates going down, Norcia responded, "not in the near future."

Norcia said that's because of the high level of investment the utility is making in the grid. Over the next five years, DTE is planning to invest $9 billion in automation, tree trimming and other programs to reduce the duration and frequency of outages. He said DTE's cash from operations, along with debt and funding from other investors, has gone to investments like these. A rate increase for customers then "carries the investment that we've made over the last four years."

Norcia said there is one thing that would help put downward pressure on rates: how fast electric vehicles are adopted.

"That'll help finance all of these investments that we need to make on the grid," he said.

5. Speaking of EVs, here's what DTE is doing to prepare for more of them

Norcia said DTE is adding about 1,000 electric vehicles to the grid per month, and that's up from a couple of hundred vehicles per month a few years ago.

"The grid that we have today can handle all of this, but in 10 years, it will not be (able to handle it), especially the oldest part of our grid," he said. "That's why we need to start rebuilding a good portion of the grid to handle this and that's new wires, new poles, as much undergrounding as possible and substations as well that need more capacity."

Contact Adrienne Roberts: amroberts@freepress.com. Nushrat Rahman covers issues related to economic mobility for the Detroit Free Press and Bridge Detroit as a corps member with Report for America, an initiative of The GroundTruth Project. Make a tax-deductible contribution to support her work at bit.ly/freepRFA.

Contact Nushrat: nrahman@freepress.com; 313-348-7558. Follow her on Twitter: @NushratR. Sign up for Bridge Detroit's newsletter. Become a Free Press subscriber. 

This article originally appeared on Detroit Free Press: 5 things we learned from our sit-down with DTE's CEO Jerry Norcia