Consumers Energy is getting out of the hydroelectric business and will sell all of its dams in Michigan the utility company announced on Tuesday.
The decision came after years of deliberating, including taking in comments from the public.
Currently Consumers Energy owns 13 hydroelectric dams across the state. Those dams are:
- The Calkins Bridge Dam on the Kalamazoo River
- The Webber Dam on the Grand River
- The Rogers, Hardy, and Croton dams on the Muskegon River
- The Hodenpyl and Tippy dams on the Manistee River
- The Mio, Alcona, Loud, Foote, Cooke, and Five Channels dams on the Au Sable River
Confluence Hydro, which is owned by Hull Street Energy, reached a deal to buy the dams from Consumers Energy and would start a 30-year agreement to supply power to the utility company. Each dam will cost just $1 to buy, totaling $13.
“We believe a sale of the dams is the best path forward for our customers. This sale balances two important needs, to lower costs for Consumers Energy’s customers while continuing to care for communities that depend on the dams,” said Sri Maddipati, Consumers Energy’s president of electric supply. “After numerous conversations with community members over the last three years to gather insights and feedback, we are confident this sale will preserve the reservoirs that hold the key to economic, recreational and community benefits at each of the dams.”
Hull Street Energy, an investment firm focused on maintaining and updating hydroelectric facilities in the U.S., has operated 47 dams across North America in the past decade. The company formed Confluence Hydro to run the 13 dams in Michigan.
According to the company's website, Hull Street Energy has sold most of the dams it has operated in the last ten years. It currently operates several different kinds of power generation facilities, including natural gas and solar, along with other related industries.
“Safety has always been foundational to everything we do,” said Ed Quinn, chief executive officer of Confluence Hydro. “With decades of experience operating hydro facilities, we are committed to preserving and modernizing these important resources to maximize their contribution to the grid. We deeply admire and respect the Consumers Energy team and the culture of safety and operational excellence they have built. We see extraordinary opportunity to leverage our combined strengths to build a best-in-class hydro company – one that protects communities, supports employees, mitigates risk, and delivers reliable, clean energy for the future.”
The sale requires approval from state and federal regulators, which could take up to a year and a half. Should the deal get the green light, Confluence Hydro will supply power from the dams to Consumers Energy under a 30-year agreement. Consumers will also purchase all of the renewable energy credits the dams receive through the federal government.
Confluence Hydro will also need to renew the dams' federal operating licenses, which are set to expire in 2034.
Consumers Energy said hydroelectric dams are less than 1% of its business and selling them will allow the utility to focus on improved reliability in supplying electricity and natural gas to customers.
Current Consumers Energy employees who work at the hydro plants will be offered jobs with Confluence Hydro, the companies said.
Communities near each of the dams have been informed of the decision, with public meetings set to be held this fall. Updates on the sale process and community meetings will be posted at https://www.consumersenergy.com/about-us/electric-generation/renewables/hydroelectric/hydro-future
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