MPSC approves $8.9 million rate increase for DTE Gas
LANSING, Mich. – The Michigan Public Service Commission (MPSC) today approved a rate increase for DTE Gas Co. of $8,974,000.
DTE Gas is expected to increase infrastructure investments, accelerate the removal of inside gas meters, and allocate more to its low-income assistance and self-sufficiency programs.
The company had sought an increase of $85.1 million annually when it filed its request in November 2017 (Case No. U-18999). After adjusting for the impact of the Tax Cut and Jobs Act and other recalculations, DTE Gas lowered its request to $38.1 million. The amount the MPSC granted today is nearly 9 percent of the original request.
Residential customers using an average of 10,000 cubic feet of natural gas per month will see a monthly increase of 95 cents, beginning with their October bills.
The Commission approved spending $135.6 million this year, $169.7 million in 2019, $193 million in 2020, and $191 million annually from 2021 through 2023 to replace high-risk cast iron or bare steel underground lines that deliver natural gas to customers. Under the Commission’s order, DTE Gas is expected to replace up to 206 miles of natural gas distribution lines annually with a target to complete the program in 2035.
DTE Gas will also relocate or remove an additional 3,000 inside meters by the end of this year and starting in 2019, annually relocate or remove 8,000 meters that lack required inspections due to access issues. The utility is expected to replace nearly 300,000 inside meters through 2023. DTE Gas was ordered to work with MPSC staff to develop improved customer relations and outreach efforts for the move-out and inspection programs.
The meter move-out and assembly inspection programs are paramount to customer safety, the Commission said, in ordering DTE Gas to file a report about its lack of meter inspections in the past and to file monthly progress reports.
The Commission also approved an increase of $1.4 million for the Residential Income Assistance and Low Income Assistance credits programs. Between the two initiatives, an estimated 88,000 customers will receive financial help.
DTE Gas last increased rates in December 2016 (Case No. U-17999).
DTE Gas Co. Case No. U-18999 Fact Sheet
- Revenue increase granted: $8,974,000
- Return on common equity (ROE): 10 percent
- Capital mix: 52 percent equity, 48 percent debt
- Overall rate of return: 5.56 percent
- Rate base: Approximately $4.24 billion
- The Commission disallowed nearly $4.5 million in proposed communications and control equipment expenditures.
- The Commission disallowed nearly $3.2 million in capital expenditures for computers and related equipment.
- DTE Gas stated that it has installed 645,000 advanced metering infrastructure (AMI) gas modules and over 300,000 advanced meter reading (AMR) gas modules. According to the company, it has installed 91 percent of its planned meters and will install the remaining meters by end of 2018.
- The monthly service charges for residential ($11.25) and small commercial ($31) customers will remain the same.
- DTE Gas was approved to recover in rates just over $2 million for its replacement of a 0.4-mile segment of the Lincoln-Traverse natural gas pipeline, which is the single source of gas supply for more than 50,000 customers in the Traverse City area.
To look up cases from today’s meeting, access the eDockets filing system here.
DISCLAIMER: This document was prepared to aid the public’s understanding of certain matters before the Commission and is not intended to modify, supplement, or be a substitute for the Commission’s orders. The Commission’s orders are the official action of the Commission.
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