Consumers Energy plans to sell its 13 aging and unprofitable Michigan hydropower dams to a subsidiary of a Maryland private equity firm for a dollar apiece, in a deal that would ensure their continued existence for the next three decades.
Company officials announced Tuesday that Delaware-based Confluence Hydro LLC, which formed in June and registered to do business in Michigan in August, plans to sell the dams’ electricity back to Consumers at an unspecified price.
Consumers has been publicly pondering a sale of its 13 hydroelectric dams in the Au Sable, Manistee, Muskegon, Grand and Kalamazoo rivers for the past three years, seeking a way out of a hydropower business that generates paltry power at a $152 million net annual loss.
The company also considered keeping or demolishing the dams, but the sale emerged as “the most cost effective for customers,” said Sri Maddipati, Consumers’ president of electric supply.
Maddipati declined to offer specifics, saying more financial details will emerge as Consumers seeks federal and state approval for the proposed sale.
