Citizens Utility Board of Michigan

It’s been about a year and a half since Michigan’s “wake-up call” moment for electric reliability: a summer 2019 day of devastating thunderstorms that led to catastrophic losses of power across the service territories of DTE and Consumers Energy. The incident focused attention on the Michigan utilities’ generally poor performance when dealing with power outages and the need for a regulatory solution. Now, the Michigan Public Service Commission (MPSC) is close to finalizing new standards for service quality for electric utilities. That includes, most prominently, the bill credits that are due to customers who experience prolonged outages (More background here, and also check out this paper from March 2020 which goes into much greater detail on ways to improve reliability in Michigan).

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The Michigan Public Service Commission (MPSC) on Dec. 17 ordered that Consumers Energy can raise rates on its electric customers by around $100 million for 2021, representing a nearly 60% cut of the utility’s original rate hike request. The MPSC’s order is broadly in line with a proposed decision by an administrative law judge that we blogged about in October.

Photo by Brendan Wood, licensed under Creative Commons Attribution-ShareAlike 2.0

We are entering a winter that is particularly bleak due to the continuing pandemic. Access to home heating services is more important than ever, so it is good news that an additional $54.5 million in funding will be available for heating assistance for low-income customers, as the Michigan Public Service Commission and the Michigan Department of Health and Human Services announced Dec. 3.

A word that comes up frequently in discussions about the future of energy in Michigan’s Upper Peninsula is “opportunity.” “Clean energy is a big opportunity for the Upper Peninsula,” Bryan Newland, the tribal chairman of the Bay Mills Indian Community in the eastern end of the UP, said in his opening remarks at the UP Clean Energy Conference, held virtually Nov. 9. Wind and solar energy backed up by batteries can create more locally-sourced power, which means more jobs for the UP, Newland said.

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Consumers Energy’s pending request to increase its revenue, which would amount to one of the biggest rate hikes from the utility in years, should be slashed over 56%, an administrative law judge (ALJ) recommended to the Michigan Public Service Commission (MPSC) last week. If that cut is approved by the MPSC, the rate increase on Consumers Energy customers would be around 2.5%, instead of the 5.9% increase requested by the utility.

Overall, it is encouraging that the judge is recommending real discipline onto Consumers Energy’s rate proposal. The utility asked to raise rates more than usual at a time of unprecedented economic stress for its customers.

Photo by Brendan Wood, licensed under Creative Commons Attribution-ShareAlike 2.0.

Fake utility scam calls have been on the rise in recent weeks based on reports made to the Michigan Public Service Commission’s (MPSC) Customer Assistance Division. As a result, the MPSC is warning customers to be on alert for calls threatening to cut off service and demanding immediate payment.

Part of the mission of the Upper Peninsula Task Force is to “formulate alternative solutions for meeting the UP’s energy needs,” including “alternative means to supply the energy sources currently used by UP residents, and alternatives to those energy sources.” As we have written about in this space before, that mission has led the task force to explore electric vehicles (EVs) and renewable energy as options to make energy more affordable for the region in the long-term while also transitioning toward the goal of lower emissions.

Expanding both EVs and renewable energy will require cooperation with local governments in Michigan’s cities and townships, who in many cases set ordinances and permitting processes that determine how difficult it is to build wind farms, solar panel arrays, EV charging stations and more.

Easier said than done.

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Consumers Energy has been in the news again, announcing $12 million in bill relief for residential and small business customers that CEO Patti Poppe says is the largest financial relief fund the utility has ever offered, as reported by Crain’s Detroit Business.

The Citizens Utility Board (CUB) of Michigan sees this as a step in the right direction at a time when help for customers is certainly sorely needed. But it is only a baby step—in the context of the scale of the unaffordability crisis facing Consumers Energy’s customers, and the utility’s pending electric rate case in which it proposes one of the biggest hikes in customer bills in recent memory.

An EV charging station at a parking deck in Houghton, Mich. Source: Plugshare.com

It has been almost an entire summer since we checked in on the progress of the Upper Peninsula Energy Task Force, which, after delivering its report on propane supply and alternatives to Line 5, is now about six months away from a final report on much broader energy issues facing this unique part of Michigan. For this second phase the task force is asked by the governor to “formulate alternative solutions for meeting the UP’s energy needs, with a focus on security, reliability, affordability, and environmental soundness.”

Michigan regulators have approved a settlement agreement that concludes Consumers Gas’s latest rate case, cuts the utility’s requested rate increase on residential customers by about half and provides additional assistance to low-income customers who are struggling to pay utility bills in the current economic climate.