Overview:
-Consumers Energy requests $436 million rate increase that would amount to a 13.3% hike for residential customers.
-The request comes at a time when federal energy assistance funding for low-income households is targeted for elimination by the Trump administration.
-"In a troubling continuation of the patterns we see before the MPSC from both Consumers Energy and DTE, this is at least among the largest rate hikes Consumers has ever requested, if not the largest itself," says Michigan Attorney General Dana Nessel.
Ratepayer advocates and Michigan Attorney General Dana Nessel are pushing back on Consumers Energy’s Monday application to raise rates by roughly $436 million. If approved, the new rates would increase residential electric bills by 13.3%.
The company’s rate hike requests are coming too quickly for regulators to measure reliability or affordability improvements from previous increases, Nessel said in a statement. The Michigan Public Service Commission approved a $153.8 million electric rate hike for the utility in March.
“In a troubling continuation of the patterns we see before the MPSC from both Consumers Energy and DTE, this is at least among the largest rate hikes Consumers has ever requested, if not the largest itself,” Nessel said.
DTE Energy requested a $574 million electric rate increase in April after securing a $217 million hike in January.
The rate case draws attention to Consumers’ and DTE’s increasingly large and frequent rate hike requests at a time when federal support for energy assistance is under threat. Consumers says it needs the increase to improve service for its customers.
“We have seen that past investments lead to improvements,” Consumers spokesperson Brian Wheeler told Planet Detroit. Customers spent less time without power last year and had service restored more quickly following outages, he said.
These improvements follow years of poor reliability statewide.
The Citizens Utility Board of Michigan, or CUB, 2024 Utility Performance Report ranked the state 49th for the average time to restore power following an outage and 43rd for the duration of outages per customer. Michigan places last in the Midwest for both metrics.
Consumers provides energy to roughly 1.8 million customers across a broad swath of Michigan’s Lower Peninsula, including the cities of Battle Creek, Bay City, Flint, Grand Rapids, Jackson, Kalamazoo, and Saginaw.
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Michigan regulators approve $153.8 million Consumers Energy rate hike
Michigan regulators approved a $153.8 million electricity rate increase for Consumers Energy on Friday, a 52% reduction from the $325 million sought by the company. The approved rates will take effect April 4, adding $2.78 to the average customer’s monthly power bill. This comes just 12 months after the Michigan Public Service Commission approved a…
Consumers hike will raise costs without improving reliability: customer advocates
Consumers’ latest request prioritizes expensive infrastructure upgrades that earn their shareholders a return on investment over maintenance that could have a greater impact on reliability, Amy Bandyk, executive director of CUB, told Planet Detroit.
The utility looks to use the rate hike to fund its “reliability roadmap” for improving service, which a CUB blog post last year likened to “building a new house instead of fixing the roof.”
The reliability roadmap involves maintenance like clearing limbs and branches from power lines as well as new technology, infrared cameras, durable iron poles, and a robotic dog, according to a January Consumers press release.
CUB’s research found there was no correlation over the last decade between Consumers’ rising infrastructure expenditures and reliability outcomes.
“Consumers needs to pay more attention to the results of the grid audit last year and focus on relatively cheap, basic practices like more frequently inspecting trees for trimming,” Bandyk said.
The audit of DTE and Consumers, ordered by the MPSC, said both companies failed to meet their tree trimming goals. This increases grid vulnerability, as trees hitting power lines is a major cause of outages. The audit, released last fall, found that significant portions of DTE and Consumers equipment are over 50 years-old, with some equipment exceeding the century mark.
If Consumers customers see their bills rise again, the Trump administration’s proposal to eliminate funding for the Low Income Home Energy Assistance Program, or LIHEAP, could add to the pain. The program provided $177 million in assistance to low-income households in Michigan in 2024.
Alex Kellogg, energy accountability manager at the Michigan League of Conservation Voters, calls Consumers’ rate hike request a “slap in the face.”
He noted that Michigan customers already pay more for electricity than any other state in the Midwest while dealing with poor reliability.
“At a time when costs for everything are high, Consumers Energy and DTE are trying to raise our energy bills by a combined amount of more than $1 billion,” he said.
“These latest rate hikes should be rejected by our state regulators on the grounds of cruel and unusual punishment.”