By Vallari Srivastava and Pooja Menon
(Reuters) -DTE Energy raised its five-year capital expenditure plan by $5 billion on Thursday, after posting a fall in fourth-quarter profit as the utility took a hit from lower pricing for electricity.
With electricity consumption expected to rise to record highs this year and the next, U.S. utilities have been raising their capex plans to upgrade electric lines and power grid to cater to power-hungry sectors.
DTE said it would spend $30 billion as part of its five-year investment plan to improve grid reliability and transition to clean energy. The plan also has the potential for incremental investments to support data center opportunities, DTE added.
“We continue to work with a number of hyperscalers and co-locators on opportunities within our service territory,” said DTE President and COO Joi Harris.
The utility has signed non-binding agreements with several parties which could bring roughly 2,100 megawatts of potential new load onto its grid system over the next several years.
Shares of the company were up 2% at $126.68.
However, its net income fell to $292 million in the fourth quarter from $419 million a year earlier, hurt by a 20% decline in operating earnings from its electric segment.
Regulated utilities use rate-case proceedings to determine the amount customers need to pay for electricity and natural gas. DTE had filed one such rate case to help reduce the cost of producing electricity.
The utility saved about $300 million in fuel and transportation costs after the rate case came into effect in November, but it also reduced the electricity rates for residential customers by roughly $5 a month.
DTE expects 2025 operating earnings to be in the range of $7.09 to $7.23 per share, the midpoint of which is below analysts’ estimate of $7.20 according to data compiled by LSEG.
(Reporting by Vallari Srivastava and Pooja Menon in Bengaluru; Editing by Krishna Chandra Eluri)
