Nessel files testimony with MPSC seeking to cut Consumers Energy rate hike by more than half

Michigan Attorney General Dana Nessel filed testimony with the Michigan Public Service Commission, requesting that a proposed rate increase from Consumers Energy be cut by more than half as energy and utility prices in Michigan remain high.

Consumers Energy is currently seeking to raise electric rates by approximately $456 million annually, which would hike residential electric rates by 9.8%, according to a news release from Nessel’s office. 

“Just like DTE, Consumers Energy inflates every rate request with unsupported and unjustifiable costs, to bill their customers at higher and higher gas and electric rates,” Nessel said in the press release. “It is likely the MPSC will simply split the difference between the well-reasoned numbers my office proposes and the obscene demand from the utility, as they’ve done many times. In this time of serious cost concerns in households all across Michigan, from groceries to gasoline, from the gas bill to the electric bill, it is remarkable our utilities continue to demand, and receive, rate hikes as large as we’ve ever seen.”

According to Consumers Energy’s website, the company provides electric services to around 1.9 million Michigan customers. Since 2020, the Michigan Public Service Commission has approved nearly $800 million in rate hikes for Consumers Energy.

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Most recently, on March 27, the commission approved a rate hike that would raise residential customer electricity rates by 8.9% and generate an additional $276.6 million in revenue for Consumers — significantly less than the initial rate hike proposed by the utility, which asked for a $436 million rate hike, prior to Nessel’s office intervening. 

Consumers Energy announced its intent to pursue the current proposed rate hike on April 3, just seven days after the last rate increase was approved. The application to raise rates was filed in early June. 

“Consumers Energy is making upgrades every day that mean fewer and shorter outages for our customers. Our request to state regulators to approve this Reliability Action Plan is all about continuing that work to improve our customers’ quality of life,” Brian Wheeler, a spokesperson for Consumers Energy, wrote to the Michigan Advance. “We understand the impact of rising costs, from gasoline to groceries, so we also are doing more to help people lower and manage their bills. This plan will secure the grid while also keeping Michigan’s residential electric bills well below the national average and below neighboring states like Ohio and Indiana.”

Nessel said in her press release that she has filed testimony with the Citizens Utility Board of Michigan regarding the proposal by Consumers Energy to increase its profit margin on capital investments to 10.25%. Nessel said that would make it the highest return on equity in the state and likely one of the highest in the nation, and argued that the MPSC should limit Consumers Energy’s return on equity to just 9.20%.

Other groups filing testimony in relation to the rate hike include the Michigan Environmental Council, the Great Lakes Renewable Energy Association, the Association of Businesses Advocating Tariff Equity and the Environmental Law & Policy Center.

Courtesy of Michigan Advance