MPSC OKs $95M rate increase for Consumers Energy natural gas customers - Detroit Free Press

MPSC OKs $95M rate increase for Consumers Energy natural gas customers

Consumers Energy natural gas customers will see bills increase by about $4 in October
Adrienne Roberts

A typical residential Consumers Energy natural gas customer will see an increase of $4.20 on their bill beginning in October after the state body that regulates utilities approved a $95 million rate increase Wednesday.

The Michigan Public Service Commission approved the rate increase at its commission meeting, representing a more than 55% reduction from the initial $212 million increase the Jackson-based utility sought. The money will be used to make capital infrastructure improvements, invest in technology and operational efficiency and will go to increased financing costs.

Consumers Energy said in a news release that the rate hike will allow it to continue to do the work to reduce leaks in its natural gas pipeline. The improvements, the utility said, are part of its " Natural Gas Delivery Plan, a 10-year, $12 billion blueprint to modernize the system of pipelines and storage that delivers natural gas to homes and businesses."

That plan includes replacing thousands of the lines that connect the main arteries of Consumers Energy’s natural gas system to homes and businesses, replacing hundreds of miles of the pipeline "expressway" that powers the natural gas system, and rehabilitating or retiring outdated infrastructure, the utility said.

The settlement agreement was signed by Consumers Energy, the Office of Attorney General Dana Nessel, MPSC staff and several intervenors in the case, which include the Retail Energy Supply Association, Michigan State University, Residential Customer Group and Citizens Utility Board of Michigan.

The state's Office of the Attorney General filed testimony arguing that Consumers Energy should only receive a rate increase of about $52 million and opposed a separate proposal from the company to increase by $2 monthly service charges for residential and small commercial customers.

Consumers Energy's most recent gas rate increase of $170 million was approved in July 2022.

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The MPSC also announced the next steps Wednesday in its efforts to address challenges to electric reliability. The commission, which is concerned in particular about the length of time it takes Consumers Energy and DTE Energy to restore power after an outage and the significant numbers of utility customers experiencing repeat outages each year, is seeking comment from stakeholders on proposals such as:

- Establishing penalties for utilities whose customers experience four or more sustained power interruptions per year.
- Utilities would be penalized further for having customers experience seven or more sustained power interruptions. Annual reports filed by the utilities indicate DTE had 16,262 such customers and Consumers Energy had 19,821 in 2022, MPSC said.
- Utilities would be penalized if a circuit ranked in the top 10 worst-performing circuits for three or more years within the past five years.
- The MPSC is considering financial mechanisms connected to the time it takes utilities to restore power, including a particular focus on restoration timelines during major storms.

The MPSC is seeking comments from stakeholders on these proposals by Sept. 22.

Contact Adrienne Roberts: amroberts@freepress.com.