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Consumers Energy wants to raise residential rates by 8%

It would be the second rate increase in the span of a year for the utility company
Posted at 5:49 PM, Apr 01, 2021
and last updated 2021-04-01 18:43:25-04

WXMI — Less than a year after the Michigan Public Service Commission gave Consumers Energy the go-ahead for an over $90 million rate hike – raising the average residential bill by $9 – now the state’s largest energy provider is asking for permission to do it again.

This time, Consumers is asking for permission to raise electric rates to the tune of $225 million.

Roger Morgenstern, spokesman for the utility company, says the added revenue will help them transition to an electric car fleet, of which Consumers has one of the largest in the state. It will also help them take care of tree trimming in problem spots where branches near lines cause consistent outages – in fact, trees on lines is the number reason for them. They also want to make Consumers carbon neutral by 2040, capping off with the closure of their coal-burning Campbell Plant in West Olive.

The issue, says a number of groups and the state attorney general, is who will be facing the brunt of the cost.

“This would exacerbate the already disparate and unjust rate burden that’s placed specifically on residential customers and low-income customers across Consumers’s territory,” said Mike Berkowitz with the Sierra Club, a group focused on clean energy and environmental justice. “Residential customers – families – are not the class of folks that have the ability to deal with this burden.”

This week the Sierra Club joined the Citizens Utility Board of Michigan, Michigan Environmental Council, Natural Resources Defense Council and Attorney General Dana Nessel in asking the commission to block the rate hike.

Berkowitz points to the unforeseen financial consequences of the pandemic as a reason to hold off on raising energy costs.

Under the proposal, residential customers would have their rates increased by 8.3% while commercial customers would see a 4.2% rise. Industrial customers, some of Consumers's largest accounts, will see a rate raise of only 0.4%.

“A residential customer--their typical energy cost is just $4 a day,” said Morgenstern. “We know this is an increase, but from a dollar standpoint it is lower than even a 1% increase would be for an industrial customer, which is using a significant more amount of energy.”

Morgenstern also notes that Consumers placed a moratorium on shutoffs during the pandemic and has also made tens of thousands of dollars available for energy assistance. But Berkowitz worries that while not all residential customers will see this as a massive burden, it could be a tipping point for some communities and families that are already struggling.

“We know that that’s disproportionately going to impact the people that already are facing these unjust histories of racist policies, and forcing them to spend more of their livelihood percentages on energy bills at home,” he said.

The Michigan Public Service Commission is currently taking public comment on the rate raise, and Berkowitz encouraged anyone with something to say to reach out. Hearings featuring expert testimony and cross examination of witnesses will take place between July and August before a final decision is made sometime between November and December of this year.

In the meantime, Morgenstern encourages all Consumers customers to call 211 to see if they qualify for energy assistance.

For more info on the Sierra Club, click here.

For Consumers Energy assistance and resources, click here.

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