CMS eyes wind and solar as it pursues net-zero carbon emissions reduction target

CMS Energy said Feb. 4 that it wants to add 800 MW of new wind generation, 300 MW of solar generation and 500 MW of demand response, all as a part of its effort to reach its net-zero carbon emissions reduction goal.

The Jackson, Michigan-based utility holding company and its utility subsidiary Consumers Energy recently brought online a wind farm it acquired from Enel Green Power North America, and said it is aiming at 1,100 MW of new solar generating capacity by 2024, and a total of 6,000 MW of solar by 2040.

"We invested more than $700 million in gas, electric and renewable infrastructure to support our clean energy transition" in 2020, Garrick Rochow, president and CEO of CMS Energy and Consumers Energy, told analysts.

He said the company is "committed to lead the clean energy transition by bringing renewable energy and energy waste reduction opportunities to all of our customers."

Rochow told analysts that CMS is raising its five-year, 2021-to-2025 capital plan by $1 billion to $13.2 billion. Of that a total, $2.4 billion is expected to be spent on clean energy generation, $5.5 billion on the company's electric utility and $5.3 billion on its natural gas utility. The company is expecting a roughly 7% per year growth in its rate base, from $21.5 billion in 2021 to $28 billon 2025.

Coal-fired generation as a percentage of the company's rate base in 2016 was 20%, but following retirements it is now 15% and projected to go to 10% by 2023.

The company and its utility subsidiary Consumers Energy expect to "find replacement power" when Entergy retires its 811-MW Palisades Nuclear Generating Station in Covert, Michigan in 2022.

Consumers also intends to retire its 544-MW Karn Unit 1 and 2 coal-fired facility in 2023, change its contract with Midland Cogeneration Venture in 2025, and will retire its J.H. Campbell Units 1 and 2 in 2031, and Unit 3 in 2039. Campbell Units 1 and 2 have combined capacity of 643 MW. The capacity of Unit 3 is 916 MW.

Electric deliveries down 2% in 2020

While Consumers' utility sales "continue to recover," the company said that total weather-normalized electric deliveries in 2020 were off 2% compared to 2019, though residential deliveries were up 5%. Commercial deliveries were down 6% year over year, and industrial deliveries were off 10%.

CMS reported a 2020 year-over-year adjusted earnings per share increase of 7%. It noted that its clean energy mix was roughly 1.5% of its adjusted earnings per share in 2008, but is now up to 12%.

On Jan. 11, Consumers announced that its 150-MW Gratiot Farms Wind Project in Gratiot County became operational. Consumers acquired the project from Enel Green Power America, and it represents a $260 million investment, the company said.

The facility becomes the third wind farm that Consumers owns and operates. The other two are the 100-MW Lake Winds Energy Park in Mason County and the three-phase, 231-MW Cross Winds Energy Park located in Tuscola County.