DTE Energy Company (DTE) and General Motors Company (GM) have entered into an agreement under which DTE Energy will install the largest photovoltaic solar array in Southeast Michigan at the General Motors’ Detroit-Hamtramck assembly plant.
The 516-kilowatt project has the capacity to generate electricity of 54,750 Volts, which will charge 150 electric cars with extended-range capability per day throughout the year. The array will supply on-site electricity to General Motors by converting sunlight to electricity and will focus toward the production area of the Chevrolet Volt electric car. The 264,000-square-foot project is expected to be completed at the end of the summer and will save approximately $15,000 per year over the 20-year easement agreement. DTE energy is investing $3.0 million into the project.
The Detroit-Hamtramck installation is part of DTE Energy’s SolarCurrents pilot program that has two components. A pilot program for customer-owned solar installations has met its goal of five megawatts whereas a utility-owned installations’ program has a goal of 15 MW. The company plans to add approximately 1,200 MW of renewable energy by 2015 through the program.
The array will be located on six-acre plot on the south side of the Detroit-Hamtramck facility. The Detroit-Hamtramck facility is selected as it has available space for the array and is home to the Volt.
The photovoltaic solar array will complement other green activities at the plant, which was recently named as Michigan Clean Corporate Citizen. Additionally, the efficient lighting upgrades and other energy efficiency projects will save approximately $3.0 million per year in energy costs.
DTE Energy Company is supported by its stable and growing utilities business and its complementary non-utility businesses. Going forward, growth momentum will be maintained by beneficial regulatory policies in Michigan, higher rates, an approved 11% ROE for its regulated assets, and a strong balance sheet.
However, we believe that valuation continues to be restrained by the present unfavorable macro backdrop, lower demand for electricity, dismal Michigan economy and pending regulatory cases. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.
In April this year, DTE Energy announced its first-quarter 2011 operating earnings of $1.11 per share, which fell short of the Zacks Consensus Estimate by a dime. Earnings in the quarter were also lower than $1.38 per share reported in the year-ago period.
DTE Energy is a Detroit-based diversified energy company involved in the development and management of energy-related businesses and services nationwide. General Motors is one of the leading users of renewable energy in the manufacturing sector, generating energy from solar, hydro, and landfill gas resources.