Consumers Energy electric ratepayers will save millions due to a lower rate increase won through a settlement agreement struck between the company and intervening groups including the Citizens Utility Board of Michigan, the Michigan Attorney General and many others. The settlement, which was approved by the Michigan Public Service Commission (MPSC) today (Jan. 19), also includes provisions that will require Consumers Energy to take important steps on improving reliability, allowing customers to adopt distributed energy and better considering environmental justice issues (Case U-21224).
"As a result of this settlement agreement, Consumers Energy must make important progress toward using ratepayer dollars more efficiently. That includes steps to prevent power outages before they happen," CUB Executive Director Amy Bandyk said. "Michigan utility customers pay some of the highest rates in the country for some of the worst electric service in the country. Settlement agreements like this one can put us on a path to turning this situation around."
The MPSC order approving the agreement authorized Consumers Energy to raise its revenues by $145.7 million, down from the $272 million the company initially proposed in this rate case. That translates to an increase on residential customers of 2.4%, compared to 6.8% as initially proposed.
Other provisions of the settlement agreement include:
- In its next electric rate case, Consumers Energy will report on the availability of distribution monitoring technology, including distribution fault anticipation (“DFA”), and the potential for the company to deploy the technology. CUB has advocated the use of this technology as a way to detect and stop potential outages before they happen.
- Consumers Energy "will propose a pilot for electrifying residential use of propane, fuel oil, and other unregulated fuels in its next electric rate case," the agreement said.
- In future rate cases, Consumers Energy will conduct an analysis of reliability and load/hosting capacity for customers in environmental justice communities. In addition, the company "will propose a plan to incorporate environmental justice and equity into the Benefit Cost Framework and Grid Archetypes analysis which the Company uses to prioritize its distribution investments in its rate cases," the agreement said.
- The utility will do more customer outreach following rate increases, especially for low-income customers, including more information about how to receive bill assistance.
- Consumers Energy will double the size of the cap on the number of distributed customers it must connect to the grid.