Consumers Energy tells Saginaw council data centers are manageable; council presses on peak rates, water use

Representatives from Consumers Energy briefed Saginaw City Council on June 22 about utility readiness for potential data-center development and answered council questions about reliability, customer bills and water use.

Kyle McCree, director of community affairs at Consumers Energy, and Michelle Eaton, from the company’s growth team, told the council the utility has “adequate supply today, tomorrow and in the future” and that large-load projects trigger infrastructure upgrades that the project proponents generally pay for. Eaton summarized protections the company sought through the Michigan Public Service Commission and said the tariff approved for very large users (projects triggering 100 megawatts or more) requires application fees, collateral and long-term contracts intended to prevent cost-shifting to residential customers.

"Large-load projects will pay their own way," Eaton said, describing the tariff protections and collateral requirements Consumers Energy now enforces. Kyle McCree added that the company’s integrated resource planning and a multiyear grid-investment program underpin their readiness.

Council members raised several concerns. One member asked whether a new large user could raise peak-hour charges that would be passed on to household customers. Consumers Energy responded that (1) data centers typically have flexibility to shift load or use batteries to avoid peak demand; (2) Michigan’s cost-of-service regulatory structure requires each customer class to bear its cost to serve; and (3) the company models each large proposal for reliability and least-cost connections before work proceeds.

Council members also asked about water use for data-center cooling. Consumers Energy said water use varies by facility design and recommended the council consult city water and wastewater staff for site-specific assessments; city staff later presented plant capacities, noting available allocations and options such as treated wastewater reuse for cooling.

What this means: The presentation set technical guardrails and regulatory context for any future data-center proposals. Consumers Energy said protections are in place to limit risk to residents’ bills, but council members signaled they will continue scrutinizing peak-demand modeling, local water impacts and community-level tradeoffs before any rezoning or approvals occur.