DTE Energy (DTE - Free Report) recently offered open bidding for renewable developers to participate in new solar and wind projects of Michigan. Notably, this is a step ahead toward its commitment to reduce carbon emissions by at least 80% by 2040. In this line, the company is issuing Requests for Proposals (RFP), targeting solar projects of 25-200 megawatt (MW) and wind projects of 100-200 MW.
DTE Energy expects these projects to start commercial operation between 2021 and 2023. Furthermore, the company aims to add up to 775 MW of renewable energy assets to its portfolio during the same time period.
Michigan’s Renewable Energy Prospect
Per the U.S. Energy Information Administration, Michigan’s electricity generation primarily depends on coal. However, coal-fired power plants' share declined to 37% of Michigan's net electricity generation in 2018, down from 53% five years earlier. This is because, in tandem with the whole world, Michigan is rapidly transforming toward a clean energy state.
Last year, renewable resources accounted for more than 8% of the state’s net electricity generation, which is expected to increase in the coming years.
In October 2008, Michigan enacted the Clean, Renewable, and Efficient Energy Act. Under the Act, the state's investor-owned utilities are required to generate 10% of their retail electricity sales from renewable energy resources by 2015. In December 2016, that requirement was increased to 15% by 2021.
Being Michigan's largest producer of renewable energy, DTE Energy’s latest RFP will enable the company to meet the state’s Renewable Portfolio Standard in time.
In fact, other major utilities in the state are also working on enriching their renewable portfolio. In June 2019, CMS Energy Corporation (CMS - Free Report) announced that its subsidiary, Consumers Energy, received approval from the Michigan Public Service Commission to go ahead with its Clean Energy Plan. Under the plan, by 2023, the company is determined to close two of its coal-fired plants, more than a decade ahead of schedule, and add 5,000 MW of solar energy through competitive bidding.
Global Green Energy Expansion
In the United States, utilities are increasingly adapting renewable energy sources to produce electricity, with wind and solar energy gaining popularity, in particular. Per a recent forecast by the U.S. Energy Information Administration (EIA), wind, solar and other non-hydropower renewables will contribute 10% in 2019 and 12% in 2020 to total utility-scale generation in the United States.
Backed by such solid prospects, major U.S. utilities like DTE Energy are trying to reduce carbon emissions rapidly. The company’s DTE Electric segment plans to withdraw a portion of its coal-fired generation and set goals to lower carbon emission by 80% by 2040 from 2010 levels.
In the same line of action, American Electric Power (AEP - Free Report) aims to reduce carbon dioxide emissions from its generating facilities by80% from 2000 levels by 2050. Another utility, Xcel Energy Inc (XEL - Free Report) targets to reduce 80% carbon emission by 2030 from 2005 level.
Shares of this Zacks Rank #2 (Buy) have gained 15.6% in a year compared with the industry’s 11.5% growth. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
5 Stocks Set to Double
Zacks experts released their picks to gain +100% or more in 2020. One is a famous cutting-edge food company that is “hiding in plain sight.” Swamped with competitors and ignored by Wall Street, its stock price floundered. Now, suddenly, it acquired a company that gives it an advantage none of its peers have.
Today, see all 5 stocks with extreme growth potential >>