DTE’s Reason for Buying M-U Pipes: NatGas-Fired Electric Plants

gasfiredpowerplantillustration1x1-largeLast week MDN brought you the news that DTE Energy, a BIG utility and midstream company based in Detroit, MI, is buying 100% of M3 Midstream’s Appalachia Gathering System (AGS), located in Pennsylvania and West Virginia, and 40% of M3’s Stonewall Gas Gathering (SGG), located in West Virginia (see DTE Energy Buys Marcellus/Utica Pipelines for $1.3B). MDN speculated that DTE wants the pipelines because DTE wants a reliable source cheap, abundant, clean-burning Marcellus/Utica natural gas for its utility customers in the Midwest. While that’s true, there’s a bigger reason why DTE is making a play for the pipelines–because they intend to build $1.5 billion of new natural gas-fired electric plants in Michigan. Since that price tag will build one, maybe two plants, and because DTE is shutting down three of its five coal-fired plants in the state, we think there’s a good chance DTE will build more new gas-fired plants–powered by Marcellus/Utica gas…

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