Michigan just priced what it costs a hyperscaler to walk away: fifteen years of bills
Regulators approved DTE Electric's 20-year contracts for Google's 1 GW Van Buren Township campus on October 1, with an 80 percent minimum bill and a termination payment worth at least 15 years of minimum charges. Brazil asks large loads for three years of grid charges. China skips the question by wiring the generation to the server.
The Michigan Public Service Commission approved two special contracts between DTE Electric and Google LLC on October 1 for electric service to a data center in Van Buren Township, Wayne County, in Case No. U-22058 [MPSC, 1 October 2026]. The vote was unanimous [Planet Detroit, 1 October 2026]. The headline is not the gigawatt. It is the exit price. Michigan’s regulator has put a hard number on what a hyperscaler owes the grid if the AI demand it promised does not arrive: at least fifteen years of minimum monthly charges.
What’s happening
- The Primary Supply Agreement runs 20 years, against the 5-year contracts standard on DTE’s D11 rate. It sets minimum billing demand at 80 percent of contracted demand, against 50 to 65 percent for standard customers, and carries an early termination payment that requires Google to pay minimum monthly charges for at least 15 years, backed by credit and collateral requirements [MPSC, 1 October 2026].
- A second contract, the Clean Capacity Accelerator Agreement, has Google fund DTE’s development of up to 1,600 megawatts of renewable energy and up to 480 megawatts of battery storage. Google will also give DTE 300 megawatts of capacity credits at no cost [MPSC Case U-22058 summary, retrieved 3 October 2026].
- Service is expected to begin in December 2027, with maximum load reached by December 2028. DTE projects a $1.7 billion benefit to other customers over 20 years as Google covers fixed grid costs [MPSC, 1 October 2026].
- The site, known as Project Cannoli, covers 282 acres north of I-94 between Haggerty Road and I-275 and is sized at 1 gigawatt [Planet Detroit, 1 October 2026; Michigan Advance, 2 October 2026].
- DTE filed the application on March 17, 2026. The Commission attached nine conditions, including that DTE file for a review of the status of the termination payments and collateral within three years of load ramp completion [MPSC Case U-22058 summary, retrieved 3 October 2026].
Commission Chair Dan Scripps said the protections approved “will ensure that other customers aren’t subsidizing this large addition to the state’s energy grid” [MPSC, 1 October 2026].
The number that matters is 800 megawatts for fifteen years
Desk arithmetic: an 80 percent floor on a 1 gigawatt contract means Google is billed for roughly 800 megawatts of demand whether or not the servers are running. The termination clause turns that floor into a liability with a duration. If Google walked away, it would still owe the equivalent of at least 15 years of minimum monthly charges.
That was the compromise, not the maximum. Attorney General Dana Nessel argued for a 90 percent minimum billing demand and a termination payment equal to 100 percent of minimum billing demand multiplied by every remaining month of the contract [Planet Detroit, 9 September 2026]. The Commission landed below her ask but far above the utility’s standard tariff.
The reason it matters for materials is what the contract obliges DTE to build. 1,600 megawatts of renewables and 480 megawatts of batteries are physical orders: whatever generation mix DTE picks, they mean generating equipment, inverters, transformers and battery cells. A credible 15-year exit payment is what lets a utility place those orders against a single customer. Even then, the package does not close the gap. “Despite the large amount of renewable energy and battery storage included in the Google project, it will still require additional generation,” said Shannon Fisk of Earthjustice, representing the Sierra Club [Planet Detroit, 9 September 2026]. Fisk told Planet Detroit the intermittency of renewables means the campus will likely need 200 megawatts of additional capacity. Separately, DTE announced on August 25 that it will seek approval for 1.4 gigawatt and 700 megawatt natural gas plants in its upcoming integrated resource plan [Planet Detroit, 9 September 2026].
Brazil angle
Brazil prices the same risk at a fraction of the horizon. ANEEL’s Normative Resolution 1.122/2025, in force since January 1, 2026, requires large loads such as data centers connecting to the Rede Básica to post a contracting guarantee of at least three years of system usage charges, returned after energization [Campos Mello Advogados, 29 May 2025]. On desk arithmetic, Michigan’s termination clause reaches five times further, though the two are not the same instrument: Brazil’s guarantee covers transmission usage charges and is refunded, while Michigan’s covers the full minimum bill and survives the exit.
The gap is already showing up in Brazilian enforcement. On October 2, Plural reported that ANEEL and Copel had flagged a lack of financial backing at DataSpots, a Curitiba company that announces 650 megawatts of data centers across the country and has filed 18 access requests with ONS totaling 1,550 megawatts in six states. Its project company Polaris and the DataSpots parent each carry capital of R$ 1,000 [Plural, 2 October 2026]. Eleven of the requests were filed on May 19 and 20, 2025; on the 20th, ANEEL’s board approved Resolution 1.122, which began requiring the guarantee. ANEEL’s rapporteur, Director Gentil Nogueira de Sá Júnior, concluded that there is not even existing patrimonial backing (desk translation of “sequer há lastro patrimonial existente”) [Plural, 2 October 2026]. ANEEL plans to take up guarantee requirements for large loads on distribution networks on its 2026 to 2027 agenda, with a conclusion expected in 2027 [Plural, 2 October 2026]. Michigan’s order is a ready template for that docket.
US angle
Michigan has now approved two hyperscale contracts in under a year. The 1.4 gigawatt Oracle and OpenAI project in Saline Township had its DTE contracts approved ex parte in December 2025 [Planet Detroit, 9 September 2026]. Local politics are moving on a separate track: on the same day as the MPSC vote, the Wayne County Commission overrode County Executive Warren Evans’ veto of a tax exemption worth more than $125 million to Google [Planet Detroit, 1 October 2026].
The storage half of the deal runs into a supply chain the contract does not control. Benchmark Mineral Intelligence expects total US lithium-ion battery demand of 182 GWh in 2026, with 37 percent from stationary storage, and describes the US as heavily dependent on Chinese imports for storage because of China’s grip on lithium iron phosphate cell supply [Benchmark Mineral Intelligence, 17 March 2026]. The order discloses 480 megawatts of power, not megawatt-hours of energy, so the cell volume depends on duration choices DTE has not yet published.
China angle
China answers the stranded-asset question differently: it builds the generation for the data center and wires it in directly. The first large-scale project supplying renewable power straight to data centers started operating in May, integrated with a cloud base in Zhongwei, Ningxia, with 500 megawatts of solar and a further 1.5 gigawatts of wind planned by year end [South China Morning Post, 3 May 2026]. The Next Web reported the first phase at 2 gigawatts of solar, wind and storage with a planned cost of $1.27 billion, and reported that authorities want renewables to supply roughly four-fifths of the AI data center sector’s power by 2030, up from around a tenth in 2023 [The Next Web, 25 June 2026]. In that model the state and its developers carry the pairing risk. In Michigan, the hyperscaler carries it in writing.
Elsewhere in Latin America the question is arriving fast. Chile’s data center grid connection pipeline, counting connected projects, those in process, authorized and seeking grid work, nears 2.0 gigawatts [BNamericas, 2 July 2026].
What it means
The 15-year termination payment is the missing piece in AI power procurement. The risk in ordering generation, storage and grid equipment for a single customer is that its demand forecast evaporates. A regulator-approved exit price converts a hyperscaler’s promise into collateralized revenue, and collateralized revenue is what moves turbines, transformers and cells from backlog into delivery schedules. Tantalum’s power sub-index sat at 103.2 in the October 3 recompute, against 95.3 for materials and 97.3 for the composite TAI [Tantalum indexes, 3 October 2026]. Power is the only leg of the index above its January base.
What to watch
- The three-year termination review. DTE must file for a review of termination payments and collateral within three years of load ramp completion; DTE expects maximum load by December 2028 [MPSC Case U-22058 summary; MPSC, 1 October 2026]. Any loosening would signal that 15 years was a ceiling, not a floor.
- DTE’s storage procurement. Watch for the first DTE solicitation or award under the 480 MW storage allocation, and whether it names duration and cell origin.
- ANEEL’s large-load guarantee docket. If the 2027 rule for distribution-connected large loads moves beyond three years of charges, Brazil will have followed Michigan’s logic. The DataSpots case is the test file.
