Consumers Energy Negotiates Sale of 13 Aging Michigan Hydroelectric Dams Amid Financial and Safety Concerns

Consumers Energy is in active negotiations to sell its fleet of 13 hydroelectric dams across Michigan for a nominal price of $1 each, seeking to relieve the financial burden of costly maintenance and safety upgrades, the utility confirmed recently.

The dams, which span five rivers including the Au Sable, Muskegon, Manistee, Grand, and Kalamazoo, are more than a century old and produce only about 1% of Consumers’ electricity—at roughly nine times the cost of other energy sources. The company reports losing over $150 million annually on upkeep and upgrades for these facilities, prompting the move to find a buyer willing to operate the dams while Consumers continues to purchase the electricity generated under long-term agreements.

“We are negotiating with potential buyers but have not reached a final decision,” said Consumers Energy spokesperson Brian Wheeler. “This is a complex process, and we want to ensure the best outcome for our customers, communities, and employees.” The utility is reviewing bids from interested parties and evaluating how potential federal funding for dam safety upgrades might influence the decision.

The federal government has made more than $770 million available to Consumers Energy through loans and grants for dam safety improvements, which could impact whether the company decides to keep, sell, or dismantle the dams. The U.S. Army Corps of Engineers invited Consumers to apply for up to $749 million in loans for upgrades at six of the dams, while a separate federal program awarded $23 million for work on 10 of the dams.

Local residents and businesses around the dam reservoirs express mixed feelings about the potential sale. Many, like Mio Lake homeowner Mark Wilsey, are cautiously optimistic but emphasize the importance of ensuring any new owner has the financial resources and expertise to maintain the dams safely. Wilsey noted that the dams support recreation, property values, and local economies, and that losing them could dry up private wells and harm tourism-related businesses.

However, environmental and conservation groups, including the Michigan Hydro Relicensing Coalition—a coalition of five nonprofits—oppose the sale and advocate for dam removal to restore Michigan’s coldwater river ecosystems. They warn that new owners may lack incentives to invest in costly safety upgrades, potentially repeating past failures seen in Michigan where dams were sold to financially unstable owners, leading to safety risks and taxpayer-funded repairs.

The coalition’s executive director, Bob Stuber, stated, “There is no incentive for a new owner to ever put a penny into these once they buy them. Consumers has extracted financial gain and needs to be a good neighbor, not walking away through a sale.” The group highlights the 2020 collapse of the Edenville and Sanford dams as a cautionary example of what can happen when dam upkeep is neglected.

Consumers Energy faces a challenging decision: continue operating the dams at a financial loss, sell them and risk future safety and environmental issues, or remove them altogether, which would alter the landscape and local economies dependent on the reservoirs. The company has committed to ongoing communication with stakeholders and expects to make a final decision later this year.