Ann Arbor, DTE Sign Country’s First Heating Franchise to Include Climate Goals

Officials from the City of Ann Arbor and DTE Energy joined on Earth Day, April 22, 2025, to sign a new heating franchise, the first in the country to include a climate agreement with associated activities that will demonstrably improve health, safety and make forward progress toward addressing the climate crisis. 

Students from Bryant Elementary, residents of the Bryant neighborhood, members of the local unions, city staff, DTE staff and more gathered April 22 for the historic signing at the Bryant Community Center. The signing was followed immediately by an outdoor reception where kids and adults alike celebrated this franchise of the future, together.

Included with the franchise is an Agreement Regarding Climate Action (ARCA), which outlines commitments to cooperate in support of the City of Ann Arbor’s A2ZERO program, Ann Arbor’s work to achieve a just transition to community-wide carbon neutrality by the year 2030, as well as a commitment to help advance DTE’s own goals for achieving net-zero carbon emissions from its operations. The ARCA also outlines a requirement for the City and DTE to collaboratively develop two-year work plans over the course of the 10-year franchise to specify activities that will be undertaken to advance stated climate goals. 

The first two-year work plan includes the potential for substantial funding commitments for community geothermal installations, energy efficiency improvements in rental units, workforce development, and the exploration of a biodigester at Ann Arbor’s wastewater recovery facility. It also includes the commitment of significant staff time to help foster better data sharing and infrastructure coordination.

The existing natural gas franchise agreement was adopted in 1997 and runs through January 2027. In 2023, Ann Arbor City Council requested staff negotiate a new franchise with a focus on finding sustainable ways to heat and cool our community. The new franchise will last for 10 years, shorter than the previous agreement, signaling the exploration of alternatives for heating that support the city’s A2ZERO goals for achieving a just transition to community-wide carbon neutrality.

“The first Earth Day was in Ann Arbor,” said Ann Arbor Mayor Christopher Taylor. “This is another historic first — a momentous example to the rest of the country of what is possible when we get creative and work collaboratively to find solutions that protect our health, safety, planet and pocketbooks.”

“This new franchise agreement with Ann Arbor was a collaborative process that represents DTE’s and Ann Arbor’s shared priorities — reducing carbon emissions as fast as possible for both DTE and the city, while focusing on providing all of our customers with safe, clean and reliable energy,” said Joi Harris, president and chief operating officer, DTE Energy. 

Learn more about the new heating franchise. Learn more about A2ZERO and Ann Arbor’s commitment to carbon neutrality at a2zero.org. 

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Media Contact: 

Dr. Missy Stults, Director of Sustainability and Innovations, City of Ann Arbor, mstults@a2gov.org