On August 8, 2025, Michigan’s energy landscape took a dramatic turn as a series of major announcements from utilities and technology companies signaled a new era for the state’s power grid. Energy Vault, a global energy storage innovator, revealed it had inked a contract with Consumers Energy, one of Michigan’s largest utilities, to deliver two battery energy storage systems (BESS) with a combined capacity of 75 megawatts (MW) and 300 megawatt-hours (MWh). This move, according to ESS News, marks a significant step in Michigan’s transition from fossil fuels to renewable energy and positions the state as a critical player in the growing race to power the next generation of data centers and digital infrastructure.
The deal will see a 45 MW / 180 MWh BESS installed at the former John C. Weadock coal plant site in Bay County’s Hampton Township, and a 30 MW / 120 MWh project in Oscoda Township, Iosco County. Energy Vault confirmed that battery deliveries are scheduled to begin in the fourth quarter of 2025, with construction set to start in early 2026. Both projects, designed for daily cycling, aim to dispatch stored renewable energy during peak demand periods and are expected to become operational by the end of 2026. As the company noted, both installations are currently navigating local permitting processes—a vital hurdle for projects of this scale.
But the story doesn’t end there. This investment in storage comes at a time when the state’s utilities are facing a surge in energy demand, driven in large part by the artificial intelligence (AI) boom and the data center arms race sweeping the country. As reported by The Detroit News, both Consumers Energy and its counterpart DTE Energy are actively negotiating with technology firms to provide power for massive new data centers—warehouses packed with computer servers that require immense and steady electricity supplies.
During recent earnings calls, DTE executives revealed they are in talks with multiple “hyperscale” data centers about delivering three gigawatts of new electricity load. Their goal? To close the first large data center deal by the end of 2025. Consumers Energy, meanwhile, stated it will supply one gigawatt of electricity to a new data center, with its service ramping up into the 2030s. The exact locations and clients remain closely guarded secrets, but the urgency is clear: companies want to secure power before Michigan’s lucrative corporate tax breaks for digital infrastructure investments—signed into law by Governor Gretchen Whitmer in late 2024—expire in 2028. These incentives allow firms investing over $250 million in the state to avoid sales and equipment-use taxes, making Michigan an attractive destination for tech giants building the backbone of the digital economy.
“Data center growth will help drive affordability for existing customers,” DTE executives told shareholders, according to The Detroit News. Yet not everyone is convinced that this influx of high-tech infrastructure will benefit Michiganders. Environmental advocacy groups warn that data centers could place unsustainable pressure on the state’s water and electricity resources. Christy McGillivray, legislative and political director for the Sierra Club Michigan Chapter, put it bluntly: “It is unequivocal and irrefutable that the data center bailout to power artificial intelligence is being paid for by regular ratepayers.”
The tension between innovation and cost is palpable. Utilities like DTE and Consumers have routinely requested significant rate hikes in recent years—a trend that has drawn the ire of Michigan Attorney General Dana Nessel. “At some point, we have to ask how long utility companies like DTE and Consumers Energy will be allowed to treat customer bills and our energy rates like a blank check,” Nessel said in April, after intervening in regulatory proceedings to challenge proposed rate increases.
Against this backdrop of technological ambition and public scrutiny, Consumers Energy is also making headlines for its financial stability and shareholder rewards. On August 8, 2025, the company declared a quarterly dividend of $1.125 per share on its cumulative preferred shares, maintaining a forward yield of 5.92%. This dividend, payable on October 1 to shareholders of record as of September 2, marks the 19th consecutive year of consistent payouts—a testament to the company’s commitment to shareholder returns. Its common stock, which has seen 18 consecutive years of dividend increases, currently offers a yield of 2.93% and trades near a 52-week high of $76.45, as reported by Investing.com and Morningstar.
Financial analysts have taken note. Mizuho recently raised its price target for CMS Energy (Consumers’ parent company) from $68 to $74, while KeyBanc maintained an Overweight rating with a $76 target, citing potential growth from new large load customers—including, presumably, the data centers now in negotiation. CMS Energy also reported second-quarter 2025 adjusted earnings per share of $0.71, beating the consensus estimate of $0.68. The company’s Board of Directors declared an additional quarterly dividend of 54.25 cents per share, payable August 29, 2025.
Infrastructure upgrades are also on the horizon. Consumers Energy has announced plans to upgrade 135 miles of natural gas pipelines across 15 Michigan communities, reinforcing its role as a linchpin in the state’s energy transition. Meanwhile, CMS Energy disclosed pricing terms for a $147 million debt tender offer, involving the purchase of Consumers Energy’s 2.500% First Mortgage Bonds due 2060—a move that may further strengthen its balance sheet as it prepares for the capital-intensive years ahead.
As Michigan’s utilities race to meet the demands of a digitizing economy, the landscape is dotted with both promise and pitfalls. Existing data centers, such as Switch’s pyramid-shaped campus in Grand Rapids and Michigan 123Net’s sites in Southfield, Detroit, and Grand Rapids, are already part of the state’s tech ecosystem. Hyperscale Data, too, has announced plans to expand in Dowagiac. Yet the next wave of investment—driven by AI, cloud computing, and the insatiable appetite for data—will require not just more power, but smarter, cleaner, and more resilient infrastructure.
Ultimately, the question isn’t just whether Michigan can keep up with the data center boom, but whether it can do so in a way that balances economic growth, environmental stewardship, and fairness for everyday ratepayers. As new battery storage projects come online, utilities upgrade their grids, and negotiations with tech giants continue behind closed doors, the future of Michigan’s energy—and its role in the digital revolution—hangs in the balance.
