MPSC Approves Partial Settlement Agreement Authorizing Consumers Energy to Increase Natural Gas Rates by $49.8 Million

Article continues below...

44 Percent Below the Utility's Request

August 21, 2007 -- The Michigan Public Service Commission (MPSC) today approved a partial settlement agreement authorizing Consumers Energy to increase its annual natural gas revenues by $49.8 million, 44 percent below what the utility requested.

As a result of today's action, the average monthly bill of a typical Consumers Energy residential natural gas customer will increase approximately $2.36 per month.

"The rate increase approved today reflects the rising cost of operations to maintain a reliable natural gas system, noted MPSC Commissioner Monica Martinez. "Ratepayers can rest assured that all parties to the settlement worked to ensure that the increase was kept to a minimum."

The utility filed an application with the MPSC on Feb. 9, seeking authority to increase its rates for the distribution of natural gas and other relief.

Parties participating in the settlement were Consumers Energy, the MPSC staff, the Attorney General, the National Energy Marketers Association, and the Association of Businesses Advocating Tariff Equity.

A fact sheet with additional details follows.

The MPSC is an agency within the Department of Labor & Economic Growth.

Consumers Energy Company
Case No. U-15190
Commission Order Fact Sheet

1. Revenue Deficiency - $49,750,000.

2. Rate of Return on Common Equity - 10.75%.

3. Debt to Equity Ratio - 50% Debt, 50% Equity.

4. Consumers Energy's proposed $9.3 million energy efficiency program is not adopted in this order. The Commission will rule on this program in a subsequent order in this case.

5. Consumers will contribute $17 million to the Low Income Energy Efficiency Fund, which will assist low income customers by financing energy efficiency measures, and providing assistance in paying utility bills.
|
6. A Pension Equalization Mechanism and an OPEB Equalization Mechanism are discontinued as of the date of this Order.

7. Consumers Energy's proposed Uncollectibles Expense True-up Mechanism is not adopted.

8. The Commission Staff will organize collaborative meetings to discuss possible amendments to Consumers Energy's Gas Customer Choice program. A Staff recommendation will be submitted to the Commission within 90 days of today's order.

Case No. U-15190

Source: Michigan Public Service Commission