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Consumers Energy settles rate case before Michigan Public Service Commission

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(photo by Steve Carmody/Michigan Radio)
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CMS - Consumers Energy headquarters in Jackson, Michigan

Consumers Energy has agreed to a settlement in its rate case pending before the Michigan Public Service Commission.

Consumers had originally asked for permission to add a total of $278 million in additional charges to customers. But a host of groups, including Michigan Attorney General Dana Nessel’s office intervened in the case, arguing that Consumers couldn’t justify that type of rate increase.

The settlement brings that number down to $170 million. The average Consumers residential customer will see rates increase by 5.8%.

The deal also continues to forbid Consumers from hiking rates to cover the cost of a compressor station fire in 2019. That won’t change unless the utility wins a lawsuit pending in the Michigan Court of Appeals.

“The settlement agreement provides Consumers Energy with sufficient revenues to provide its customers with safe and reliable natural gas service, and to perform necessary repairs and upgrades to its infrastructure but at more reasonable rates than projected by the Company,” Nessel said in a statement, adding that it “omits approval of other proposed expenditures and costs for projects that are of questionable benefit to the Company’s customers.”

In a statement, Consumers says it will largely use the additional revenues to “modernize Michigan’s natural gas system.” The investments are part of the company’s Natural Gas Delivery Plan, a 10-year, $11 billion blueprint that includes upgrading transmission infrastructure, transforming compression and storage operations and replacing aging distribution pipes.

“This investment directly supports a modern natural gas system by replacing pipes dating to the 1940s to ensure safe delivery of our customers need to heat their homes and businesses,” said Chris Fultz, Consumers Energy’s vice president of gas operations. “A more reliable system keeps homes cozy in the winter, and puts warm, home cooked meals on the table for Michigan families. These critical upgrades will also help protect the environment by reducing emissions of methane, a greenhouse gas more potent than carbon dioxide.”

If the settlement is approved by the Public Service Commission, the new rates will go into effect October 1.

Sarah Cwiek joined Michigan Radio in October 2009. As our Detroit reporter, she is helping us expand our coverage of the economy, politics, and culture in and around the city of Detroit.
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