Updated March 12, 2026, 9:54 a.m. ET
Consumers Energy plans to build natural gas plants in Bay and Genesee counties as well as expand its renewable energy portfolio in the coming decades, as energy experts anticipate an increase in electricity demand from high-tech industries such as data centers and other users.
The Jackson-based utility company announced the plans Wednesday in a press release about its upcoming integrated resource plan, a long-term plan Michigan’s regulated utilities must file every five years to show how they will meet energy demand for the next 20 years.
“We are forecasting increased demand and need for increased supply to maintain reliable service for all customers — whether that growth comes from new families, expanding businesses, relocating industries, or increased energy use from those we already serve,” Consumers Energy spokeswoman Katie Carey said in an email response to questions.
Consumers Energy will take an “all-of-the-above” approach to building its electricity supply, the company said Wednesday, including building renewable solar, wind and battery storage systems that can generate 13 gigawatts of power and two natural gas plants that together can generate 1.5 gigawatts.
“Affordable, secure and reliable energy remains a cornerstone of Michigan’s future, and this plan positions the state to support new homes, businesses and industries with confidence, lowering customer costs for all,” said Sri Maddipati, Consumers Energy’s president of electric supply, in a press release. “This plan combines new natural gas units with wind, solar and battery storage to meet demand in all conditions, enhancing and securing the grid for the communities we call home.”
The announcement came as public anxiety mounts over Michigan’s electricity system. Electricity rates continue to climb in the state, and utility executives are celebrating the potential boom in demand they stand to gain from new data centers that economists warn could raise bills.
“At a time when our residential electricity rates are so high, it’s really concerning that Consumers is proposing to build two new gas plants,” said Charlotte Jameson, chief policy officer for Michigan Environmental Council. “The cost of generation and power plants falls majority on residential ratepayers, so unless we change ratemaking at the (Michigan Public Service) Commission, it’s going to be residential ratepayers who are footing the bill for those methane plants.”
Can natural gas count as clean energy?
Michigan lawmakers passed a package of clean energy laws in 2023 that require the state’s electricity providers to produce 100% clean energy by 2040.
Carey said the company is on track to meet that requirement because it will pair new renewable sources — wind, solar and battery storage — with natural gas units that operate “only when the systems need support.”
Under the clean energy law, natural gas can be considered clean energy if it is paired with carbon capture systems that either store the carbon deep below ground or use it as an industrial ingredient.
No plans for carbon capture systems
Carey said Consumers is not currently planning to add carbon capture to the natural gas units it announced Wednesday. The gas plants are designed to run only when there is high demand, when renewable wind and solar systems aren’t kicking out much power.
“Because they operate for short periods and provide peaking support, adding carbon capture does not provide meaningful customer or system value at this time,” Carey said.
But Carey said Consumers may consider adding other clean, baseload power sources — which under the clean energy law could include natural gas with carbon capture systems — in the integrated resource plan the company files in June.
Carbon capture systems are expensive and not widely used, Jameson said.
“It is not clear to me that come 2040 we’re going to have carbon capture and sequestration technology sufficient to meet the requirements of our clean energy law,” Jameson said. “If you’re using that as a compliance pathway, that’s a huge risk you’re putting on Michigan residents in the event that, come 2040, you can’t actually comply.”
In response to the Consumers announcement, Senate Energy Chairman Sean McCann, D-Kalamazoo, said there’s no doubt people are feeling the squeeze of high energy costs.
“I’m working on efforts in the Senate to make energy both less expensive and better for the environment,” McCann said. “I’m focused on bringing affordable energy to Michigan families.”
Where Consumers would build gas plants
Consumers said the two gas plants it wants to build would be placed on existing Consumers property — the former coal-fired Karn Generating Facility on Saginaw Bay and an industrial site in Genesee County’s Thetford Township, north of Flint.
Building on industrial sites cuts down on costs, minimizes land impacts and takes advantage of existing infrastructure, Consumers said in its press release. The company said the gas plants will provide reliable baseload power that will allow the company to continue adding renewable energy systems.
Consumers retired two coal-fired units at the Dan E. Karn Generating Plant in Hampton Township in 2023. The plant has two other units powered by natural gas and oil that are slated to operate through 2031. The natural gas plants announced Wednesday are in addition to those units and would come online at about the time the older units retire.
“While this project will certainly strengthen our local economy, its impact reaches far beyond Hampton Township and Bay County,” Hampton Township Supervisor Terri Close said in Consumers’ press release. “By taking advantage of existing infrastructure, this project shows Consumers Energy’s long–term commitment to provide reliable, affordable energy that will benefit families and businesses across Michigan.”
The Thetford Township property is the same site where Consumers considered building a $750 million natural gas plant in 2013, utility spokeswoman Carey said.
Consumers plans to file its integrated resource plan in June to the Michigan Public Service Commission. Carey said Consumers is still finalizing details about how much it intends to increase grid capacity to support increasing demand.
Staff Writer Craig Mauger contributed.
