Michigan regulators approve DTE-Google power deal for 1 GW data center

Overview

Updated 1 hour ago

Michigan regulators approved a 20-year power contract between DTE Electric and Google for a 1-gigawatt data center, a load about the size of a large power plant. The October 1 decision clears the largest regulatory hurdle for Project Cannoli, a planned 1.5-million-square-foot campus in Van Buren Township near Interstate 94.

The contract's structure carries the significance. Google pays for at least 80% of contracted capacity whether it uses it or not, funds up to 1,600 MW of new renewable generation and 480 MW of battery storage, and owes at least 15 years of minimum monthly charges if it cancels early. The terms aim to keep the data center's costs off the bills of DTE's other customers.

Why it matters

This 1 GW deal tests whether states can host hyperscale data centers without pushing project costs onto ordinary ratepayers.

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Key Indicators

1 GW

Contracted peak load

Google's campus is contracted at roughly 1 gigawatt, comparable to a large natural-gas power plant's output.

80%

Minimum billing demand

Google pays at least 80% of contracted capacity regardless of use, versus 50-65% under DTE's standard large-load rate.

1,600 MW

Renewables funded by Google

Google pays DTE to develop up to 1,600 MW of renewable generation and 480 MW of battery storage through the clean capacity agreement.

480 MW

Battery storage in the deal

The clean capacity accelerator agreement adds 480 MW of storage to back the data center's load.

20 years

Contract term

20-year term versus the 5-year contracts standard under DTE's D11 large-load rate.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

Daniel C. Scripps

Chair, Michigan Public Service Commission

Presided over the October 1 approval in Case U-22058

Warren C. Evans

Wayne County Executive

Vetoed data center tax incentives; commission overrode the veto October 1

Organizations Involved

Michigan Public Service Commission

State regulatory agency

Approving authority in Case U-22058

The three-member commission regulates Michigan's electric, gas and telecommunications utilities.

DTE Electric

Investor-owned electric utility

Utility party to the approved contracts

Michigan's largest electric utility and the seller under the primary supply agreement.

Google

Technology company

Contracting customer for the data center

Alphabet subsidiary that will take electric service under the 20-year supply agreement at the Van Buren Township campus.

ITC Transmission

Transmission utility

Developer of the grid connection for the data center

ITC Transmission is building the 345-kV switching station and two transmission feeds connecting the data center to the grid.

Michigan Department of Attorney General

State agency

Intervenor that pushed for ratepayer protections

The state attorney general's office intervened in the case and recommended conditions to safeguard other ratepayers.

Timeline

March 2026 October 2026

2 events Latest: 3 days ago

October 2026
MPSC approves DTE-Google power deal
Latest Decision

The commission approved the 20-year contracts with ratepayer protections; the Wayne County Commission overrode the county executive's veto of tax incentives the same day.
3 days ago
March 2026
DTE Electric files application for special contracts
Filing

DTE Electric applied to the MPSC for approval of the primary supply agreement and clean capacity accelerator agreement with Google.
March 17th, 2026

Scenarios

Project Cannoli reaches full 1 GW load by end of 2028

Likely Resolves by End of 2028

Discussed by: DTE Electric's application and the MPSC order, which project first service in December 2027 and maximum load by December 2028

ITC's first transmission feed energizes in late 2027 and the second in late 2028; the Cannoli switching station completes in the third quarter of 2028. Google's campus scales to its contracted maximum as scheduled, and the renewable and storage buildout proceeds under the clean capacity agreement.

Grid work slips, pushing Cannoli power past target dates

Unlikely Resolves by End of 2028

Discussed by: Union of Concerned Scientists' Lee Shaver and clean-energy intervenors, who warned of reliability risks in the record

Delays in the switching station, the transmission feeds, or the renewable buildout push first power or full load past the published dates. The protections still hold, since Google keeps paying minimum billing through the delay, but the campus's in-service timeline slips.

MPSC reopens contract terms after tracking shows costs exceed benefits

Unlikely Resolves by Oct 1, 2029

Discussed by: Michigan Attorney General's office, which recommended an annual benefit/cost reconciliation and a regulatory liability account

The annual reconciliation DTE must file shows costs to serve the data center exceeding revenues, exposing other customers. DTE seeks a rate adjustment or the commission amends the special contract terms in a future rate case.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

September 2024

Microsoft restarts Three Mile Island for AI power (2024)

Microsoft agreed to buy all power from Three Mile Island's Unit 1 for 20 years and fund its restart, the first time a nuclear plant was brought back online for a tech company's data centers. Constellation Energy won the 20-year deal to sell the plant's output to Microsoft.

Then

The restart secured federal approvals and the plant is targeted to come back online in 2028.

Now

The deal set a benchmark: tech firms pay a premium for dedicated, carbon-free power to serve AI workloads.

Why this matters now

The DTE-Google deal follows the same pattern, a hyperscale customer funding dedicated clean capacity, but routes it through a regulated utility's contract rather than an independent power purchase.

September 2024

Amazon buys Talen's nuclear-powered data center campus (2024)

Amazon paid $650 million for Talen Energy's Susquehanna data center campus in Pennsylvania, which draws power tied to an on-site nuclear generating station. The purchase secured dedicated, carbon-free capacity for Amazon's cloud business.

Then

Amazon gained exclusive access to power associated with Talen's nuclear plant for the campus.

Now

It signaled tech's willingness to buy or build dedicated clean generation rather than compete for general grid capacity.

Why this matters now

Amazon's nuclear campus and Google's Cannoli deal answer the same question, where 1 GW of low-carbon power comes from, with dedicated supply, one through direct purchase and one through a utility contract.

2010s–2020s

Northern Virginia data center boom and grid strain (2010s–2020s)

Loudoun County, Virginia became the world's largest data center market, with hyperscale campuses driving repeated transmission buildouts and straining the regional grid. Utilities and regulators worked to recover the cost of serving concentrated loads without burdening residential customers.

Then

Regional planners built new substations and lines to keep pace with load growth.

Now

The boom established a playbook, and a warning, for other regions facing hyperscale demand.

Why this matters now

Michigan is now building the same kind of dedicated transmission for a single customer, with ratepayer protections the Virginia buildout was criticized for lacking.