Oct. 2, 2026 | This Week in Government: PSC Approves DTE Special Energy Contracts for Large Google Data Center

State regulators on Thursday approved contracts for DTE Electric Company to power a proposed hyperscale data center for Google in Wayne County, subject to several conditions for costs to be covered by the company.

Members of the Public Service Commission, in a 3-0 vote, approved the energy contracts, which they said would provide protections to the utility’s customers to ensure costs of the project are not passed along to them.

Under the agreement, the contract duration is for 20 years with a minimum monthly billing demand of 80% of the contracted electricity instead of the standard 50-60%, even if the entire amount of electricity is not used. Google will also be required to pay for at least 15 years minimum monthly charges, credit and collateral requirements.

For its clean capacity accelerator agreement, Google would pay for the development of up to 480 megawatts of energy storage facilities and up to 1,600 megawatts of renewable energy facilities. The facilities would be fully funded by Google for the full 20-year contract without cost responsibility to DTE Electric or its other customers.

For facilities that continue operating beyond the 20-year contract term, the cost recovery would be sped up to ensure all costs are recovered before the contract ends.

Prior to the vote, Commission Chair Dan Scripps said Michigan has been working to implement some of the strongest customer protections for data centers in the country.

“We are committed to getting it right, and to make sure that the data centers who are driving these additional costs are ultimately responsible for the costs they’re imposing on the system,” Scripps said.

Scripps agreed that the provisions work for other customers and are reasonable for Google to comply with.

“Put simply, Google is one of the biggest, best capitalized and most profitable companies on the planet,” Scripps said. “Google can pay its own energy bills, and the contracts and conditions in the order before us ensure that it does just that.”

Many of the provisions in Thursday’s order are similar to those the PSC included in a December 2025 order approving contracts between DTE Energy Company and OpenAI and its partners for a hyperscale data center project in Saline Township.

DTE Electric would own, develop, install and operate the renewable energy facility and storage facilities. The facilities would be procured by contractors and third-party developers and the procurements would be reviewed by the commission in future filings.

It was noted that the energy storage facilities and energy facilities would be used to benefit the grid as a whole despite being paid for by Google.

Other requirements in Thursday’s order include that the company file a renewable energy plan, clean energy plan, an analysis of the utility’s capacity compared to the data center’s usage need and an energy waste reduction plan.

The data center is tentatively expected to begin service in December 2027 and reach maximum load by December 2028.

Ryan Lowry, a spokesperson for DTE, said the agreement ensures that the utility will keep its customers’ lights on and at a reasonable cost.

“Google will pay its own way, covering the full cost of powering its data center, so customers aren’t left footing the bill,” Lowry said in a statement. “At the same time, Google will help shoulder the cost of improving our electric system, including bringing new clean energy resources to Michigan’s grid, which will put downward pressure on bills for Michigan families and businesses in the years ahead.”

Commissioner Katherine Peretick said Thursday’s order was the result of significant work and input from stakeholders.

“A 1-gigawatt data center is not an ordinary customer,” Peretick said. “A load of this magnitude can have significant implications for generation, transmission, distribution, resource adequacy and ultimately the bills paid by everyone else on the system.”

Peretick agreed with her fellow commissioners that the protections in the order “substantially mitigate the risks of stranded costs and cost subsidization.”

She said further reporting will be required each quarter while the data center is being powered up and yearly thereafter.

According to DTE Electric, the contracts would result in a $1.7 billion net benefit for its other customers, which it states would help reduce costs.

DTE Electric has 30 days after approval of Thursday’s order to accept its conditions. Any requests for revised changes to the contracts must be filed within that period for consideration.

Commissioner Shaquila Myers said the PSC has heard significant feedback from the public over the past year regarding concerns about data center buildout.

“A data center can create substantial costs and commitments for the electric system,” Myers said. “When those costs are driven by a new large load, it is important that the customers creating those costs are responsible for paying for them. The commission has a responsibility to adequately protect all customers, and Order U-22058 today reinforces that.”

Myers listed several provisions in the contract that she said provide strong protections to DTE’s other customers.

“This conditional approval is not simply about connecting a new large load customer to the electric grid,” Myers said. “It is about making sure that growth happens responsibly. Existing ratepayers should not be asked to subsidize the infrastructure required to serve a new data center.”

Conservation groups in statements opposed the PSC’s order, saying it could have gone further with reliability requirements and having the facilities powered by renewable energy sources.

“The commission failed to encourage large, financially capable customers such as Google to develop and fund innovative, distributed solutions that can support grid reliability, accommodate load growth, and advance Michigan’s clean-energy objectives,” Katie Duckworth, staff attorney for the Environmental Law and Policy Center, said. “Addressing today’s unprecedented data center-driven load growth will require a diverse portfolio of resources and should not depend exclusively on large power plants.”

Michigan Energy Innovation Business Council President Laura Sherman also said more efforts to use renewable and other energy resources could have been accomplished in the order.

“It is disappointing that the commission failed to recognize all of the opportunities to ensure that this data center is served by clean, low-cost renewable energy and energy storage,” Sherman said. “Customer-owned rooftop solar plus storage and other distributed energy resources, as well as larger third-party owned renewable energy and energy storage projects, can serve these new loads more cost-effectively and quickly than other resources.”

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A ballot proposal that would ban public utilities and corporations with large state contracts from contributing to political campaigns, could face significant court challenges if passed by voters, the Citizens Research Council of Michigan said Tuesday.

The measure’s transparency requirements related to political advertising could lead to more information on political donors in online advertising and “issue ads” being available to the public, the group said.

The CRC also stated the transparency provisions could lead to groups instead forming Super PACs to conceal spending and donor information.

In a report released Tuesday by the CRC on Proposal 2026-2, the group analyzed the content and possible effects of the measure being pushed by Michiganders for Money Out of Politics.

If passed by voters, it would ban public utilities and corporations with large state contracts from being able to contribute to political campaigns.

It would prohibit utilities and contractors with over $250,000 yearly in government contracts, and people with organizations with connections to those contractors, from making direct or indirect campaign contributions.

A coalition of business groups, Protect MI Free Speech, is opposing the measure. Opponents have said it would affect more people than proponents of the measure have stated. Further, opponents have argued it would silence the voices of rank-and-file employees, among others tied to corporations or contractors.

The constitutionality of the measure as well as potential First Amendment affects have also been raised by opponents.

Under the measure, laws regulating spending on political communications would also be amended. Internet communications would be added to campaign finance law under disclosure requirements.

Another change to the Michigan Campaign Finance Act would enact spending and donor disclosure requirements for some issue ads that are not currently treated like campaign ads.

Karley Abramson, a research associate with the CRC, during a Tuesday media availability to discuss the report said the group expects court challenges if Proposal 2 passes.

“The utility one probably entirely and to scope, and the contractor one probably more would be challenged based on the breadth of it, not the target of contractors,” Abramson said.

She pointed out that the U.S. Supreme Court has a high bar to meet for restricting free speech. Currently, the only bar it recognizes is a quid pro quo corruption or the appearance thereof.

Abramson said that means an actual exchange of money for favors, not general favoritism or influence. She added that the U.S. Supreme Court has already essentially said expenditures cannot create a quid pro quo risk.

“For contributions, some restrictions are allowed,” Abramson said pointing to caps on campaign contributions from a person or group to a candidate per election cycle.

Abramson also pointed to the 2015 U.S. Supreme Court ruling in Wagner v. FEC, which upheld a ban on federal contractor contributions to federal candidates and political parties.

“However, Proposal 2, the way it’s written, is broader, and so it’s possible that it could be challenged in the scope,” Abramson said. “This language in this proposal is broader and seems to apply to a wider net, and so it is unclear how a court would interpret that, and whether or not they would interpret that as closely drawn enough.”

Abramson said the CRC expects the cost and workload for monitoring campaign finance compliance would likely rise under the proposed changes.

“There’s thousands of contracts this size at the state level alone. Plus, this would encompass universities, local governments, school districts,” Abramson said. “It’s a large number of people who would be impacted, so that’s … a lot to monitor.”

Implementation costs would also likely be high, she said, and it could also deter contractors from seeking government contracts and reduce the pool of applicants for government contracts.

“It’s hard to predict the impact because there’s so many contractors across every industry,” Abramson said.

While transparency could be improved in political advertising, the CRC wrote in its analysis that “it is not clear the extent to which further transparency will translate into any downstream outcomes, such as deterring donations and spending of this nature.”

“Changing the rules around spending disclosure for this kind of “issue ad” could also lead to the ads becoming more overt and the groups registering as Super PACs, as the ability to conceal spending and donors by running less direct ads would be removed,” CRC wrote.

RELATED | Vote No on Prop 2, Protect Free Speech

Long-awaited additional guidance about federal scholarship tax credits was issued by the U.S. Department of Treasury on Thursday, posing an ultimatum to governors of the 20 states, Michigan included, which have yet to opt into the Education Freedom Tax Credit: decide by Jan. 1, 2027, or miss out.

The guidance from the federal government has been the outstanding factor which Gov. Gretchen Whitmer has cited since last year when asked whether she plans to opt Michigan into the program, which would offer a credit of up to $1,700 for taxpayers who donate an equivalent amount to a scholarship-granting organization run by a school district, public or nonpublic.

On Thursday, Whitmer’s office said she was reviewing the guidance and did not yet have a comment on what her decision would be. Advocacy groups on either side of the issue began lobbying in earnest for their positions when the guidance was handed down, though, with pro-tax credit organizations urging Whitmer to follow the moves of other governors and take advantage of money that will be spent regardless and opponents of the program arguing the tax credit furthers an already problematic approach to education funding.

The Invest in Education Coalition, a 501(c)(4) group promoting the tax credit at the national level, noted that many of the governors whose states had yet to opt in were waiting to see additional information and implementation framework from the U.S. Treasury before deciding what their state should do. Now that the guidance is available and, the group’s leaders said, confirms the tax credit will function as its supporters said it would, governors still on the fence should opt in.

“This proposed guidance marks an important step toward the successful implementation of the Federal Scholarship Tax Credit Program,” Invest in Education Coalition President and CEO Anne Lesser said in a statement. “For months, states and stakeholders have been preparing for 2027 while awaiting additional clarity from Treasury. This guidance provides critical information to help move those preparations forward and gives governors in states that have not yet elected to participate additional information as they consider participation.”

Of the 30 states that have opted into the tax credit, many are helmed by Republican governors, but not all: Democrats like New York Gov. Kathy Hochul have also decided the program was worth taking a chance on, and groups like Democrats for Education Reform have been trying to make the case to governors like Whitmer that they should do the same.

“We say every child deserves a great education, and here’s our chance to prove it. Only about a third of students are proficient in reading or math right now. That should be unacceptable to us,” former U.S. Secretary of Education and DFER senior fellow Arne Duncan said in a statement. “Treasury’s rules confirm what we’ve anticipated for a while now: public school students will benefit. No program is perfect, but the only way to shape this one and make sure it works for the kids who need it most is to opt in. Republicans have sold fear. We have to sell excellence and show parents we’re fighting for their child. Democratic governors should be leaping at the chance to close the gap and own education again.”

Opponents of the tax credit, however, called on Whitmer to exercise restraint in the face of renewed pressure from those who support the program.

“No governor, regardless of which side of the aisle they’re on, should sign Michigan up for a program that will benefit a select few while taking taxpayer resources away from the vast majority of Michigan’s students,” K-12 Alliance of Michigan Executive Director Robert McCann said in a statement. “Michigan families have repeatedly told their elected officials that they don’t want public funding going to private schools and calling a voucher a tax credit doesn’t change what it does. This program would take public dollars and send them to private school tuition and Michigan’s Constitution is clear that we don’t do that here.”

Critics of the tax credit have argued that although it may offer some schools in some districts the opportunity to provide scholarships for some services, it could pose a far more serious threat to public education by simply existing as a mode of funding that’s reliant on privatizing elements of the school system that have always been public.

If school funding is reshuffled and certain services provided by schools are propped up by scholarship granting organizations, opponents worry that policymakers will be incentivized to abandon their efforts to invest in education on a larger, statewide basis, creating a patchwork public education system in which districts with a more donor-capable tax base offer better school experiences and students fall into opportunity gaps based on ZIP code.

“The federal tax credit voucher program equates to taking funding from the public school system and jeopardizes adequate funding for our most important programs. Michigan continues to make meaningful progress through investments in literacy, early childhood education and funding equity. We should be strengthening those investments, not diverting resources and attention away from our effort to support every child every day,” Garden City Public Schools Superintendent Derek Fisher said in a statement. “Our continued progress depends on keeping public dollars in public schools. Public schools welcome every child, regardless of their needs or circumstances, and we accept the responsibility of educating them every day. As educators and community leaders, we should be united in making sure public dollars strengthen public schools and commit to giving every child the opportunity to succeed.”

Whether the Legislature will move forward on a temporary suspension of the state’s gasoline tax in the wake of spiking fuel prices remained unclear Thursday following a Senate session in which no action was taken on the issue.

The Senate adjourned Thursday after taking votes on several pieces of legislation that had been sitting, some for months, leaving the issue for next week at the earliest.

Bipartisan support for suspending the gas tax has grown in recent weeks, as prices have steadily risen in the wake of President Donald Trump’s decision to wage war with Iran earlier this year.

Last month, gas prices spiked roughly 60 cents per gallon in a week, briefly topping $5 per gallon for gasoline and nearly $7 per gallon for diesel fuel.

Earlier this week, House Speaker Matt Hall, R-Richland Township, panned the idea of a fueltax suspension. He has contended that such a move would undermine the state’s long-term road funding plan, which is powered by fuel tax monies.

Hall earlier this week said any possible Senate vote was “not a serious vote” and that a three-month gas tax suspension was estimated to likely cost about $700 million.

Ohio Gov. Mike DeWine signed a suspension of his state’s fuel tax into law Thursday.

Senate Majority Leader Winnie Brinks, D-Grand Rapids, told reporters on Monday that a suspension could be a possibility, and a conversation would be had with lawmakers on the appropriateness of such a move.

A request for comment left Thursday with a spokesperson for Brinks as to the status of talks on a gasoline tax suspension was not immediately returned.

Among those who have backed a suspension of the gas tax in recent weeks include Republican U.S. Senate candidate Mike Rogers as well as Republican gubernatorial candidate John James and Democratic gubernatorial candidate Jocelyn Benson.

James has repeatedly called for a suspension of the state and federal gas tax recently.

In a Thursday post to X, formerly Twitter, James accused Democrats of punting on the issue.

“Our Republican-led neighbors in both Ohio and Indiana have suspended their gas tax to give their people relief at the pump.” James said. “Democrats in Lansing should’ve done this weeks ago. Instead, Jocelyn Benson’s running mate SENT LAWMAKERS HOME. When I’m Governor, saving Michiganders money will be my top priority. We will put an end to the political games that have failed us the last 8 years.”

Michigan Democratic Party spokesperson Derrick Honeyman, in a statement, said James is part of the problem of higher gas prices, pointing to several votes in which James has cast against efforts to stop the Iran war.

“John James and Donald Trump are responsible for the high gas and diesel prices that Michigan families are paying,” Honeyman said. “James voted for this war, he’s defended this war, and he’s done absolutely nothing in Congress to end this war or provide relief at the pump. These high prices land squarely at James’ feet, and his feign outrage now is nothing but a political stunt as his poll numbers continue to sink.”

On Wednesday, a 20-group coalition of agricultural groups led by the Michigan Farm Bureau sent a letter to Gov. Gretchen Whitmer. The groups requested she declare a state of energy emergency and issue an executive order for a 90-day suspension of “state restrictions on the use of nontaxable, dyed diesel fuel in highway vehicles registered for agricultural or forest product use.”

“A 90-day period would provide farmers and agribusinesses relief through the remainder of the 2026 harvest and give the industry flexibility during this critical period,” the groups wrote. “Michigan agriculture cannot wait until the harvest is over. Farmers, truckers, elevators, processors and other agribusinesses need to keep moving crops and products every day.”

A message left with a Whitmer spokesperson Thursday for comment was not immediately returned.

The Michigan Supreme Court will hear arguments on the retroactivity of a decision requiring a one-year notice for lawsuits against the state in all venues when it opens its new term next week.

On Oct. 7-8, the Supreme Court will hear arguments in several cases and an annual report of the court. As per tradition, it will hold its first arguments on Oct. 8 in the now Senate Appropriations Committee room, which was once the home of the high court.

Hudson v. Corrections (MSC Docket No. 169021) will be heard by the court on Oct. 8. at 9:30 a.m. Justices are hearing arguments in the case after the Court of Appeals convened a conflict panel as several decisions conflicted with each other.

The case surrounds the notice period required for lawsuits against the state. In 2020, the Court of Appeals, in Tyrell v. University of Michigan, ruled the law outlining the notice requirement applied only to Court of Claims proceedings. It was overruled by the Supreme Court two and a half years later in Christie v. Wayne State University, when that court said the one-year rule applied in all venues – the Court of Claims and local circuit courts.

In 2024, the Court of Appeals issued three decisions on the retroactivity of the Christie decision, one of those being the Hudson case that is now before the Supreme Court. The conflict panel ruled Christie had full retroactive effect.

Hudson was was filed in a circuit court before Christie was decided.

The Supreme Court is hearing arguments on whether Christie should apply retroactively.

Other cases being heard by the court will begin at 9:30 a.m. at the Capitol on Oct. 7. After the first argument, the court will move back to the Hall of Justice to finish hearing arguments.

On Thursday following Hudson, the court will hear: