Nessel challenges private jet expenses included in DTE gas rate case

Michigan Attorney General Dana Nessel filed testimony on Tuesday in DTE’s most recent request to increase its rates, calling the $266 million request “excessive and unnecessary.”

The Detroit-based energy company filed the request in January with the Michigan Public Service Commission (MPSC). It also filed for an increase to its electrical rates in March. 

In the testimony submitted by the Attorney General’s Office, business consultant Sebastian Coppola — who has testified in several regulatory cases before the commission — said DTE’s proposed gas rate hike would result in a 6.5% increase to the average customer’s bill.

Coppola also pointed to DTE’s estimated $74,769 jet travel costs included in the company’s projected expenses submitted as part of the rate case, and the company’s reporting it leased private aircrafts for executives at the vice president level and above for business trips. 

“I recommend that the Commission disallow recovery of costs for privately-hired corporate jet use, particularly since the travel pertains to investor and board of director matters that do not directly benefit customers but instead may benefit shareholders,” Coppola said in his testimony.

He also proposed commercial flights as an alternative, noting they would be less costly and have less environmental impact, pointing to DTE’s goal of achieving net zero carbon emissions by 2050.

“DTE files these rate hike requests fast and flimsy — we consistently find very little support for many of DTE’s claims,” Nessel said in a statement.

“Case in point, DTE Gas is asking the MPSC for permission to bill its customers for corporate jet travel by executives. These are the kind of expenditures they hope we don’t notice, that drive up ratepayer bills, and offer zero improvement to service or reliability,” Nessel said. “This is why we scrutinize these rate hike requests, to look out for the interests of the customers these corporations consistently try to squeeze for more.” 

The Department of Attorney General argues that DTE should receive a rate increase of no more than $112.2 million, resulting in about a 4% increase in customer’s bills. The testimony submitted by Nessel is intended to provide DTE with necessary funding for infrastructure upgrades while ensuring any increase remains modest for all customers, the department said in a news release. 

“Earlier this year, DTE Gas filed a rate request with the Michigan Public Service Commission — the first request in nearly three years — to receive approval of the company’s investment plan that will allow DTE Gas to continue to replace and modernize more than 4,000 miles of aging, cast-iron pipes that will prevent leaks and deliver on the company’s commitment of safe and reliable service while keeping energy affordable for customers,” DTE spokesperson Ryan Lowry told the Advance in an emailed statement. 

“Regarding travel expenses, a fraction of the costs for limited air travel for business-appropriate needs — including industry association meetings, which provide best practices and information sharing to run best-in-class energy companies, as well as meetings necessary to attract capital investment into Michigan — were included in the initial DTE Gas rate request,” Lowry said.

When asked about Coppola’s concerns about customer benefits and his recommendation to switch to commercial flights, Lowry told the Advance that DTE would only be sharing the statement.