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MPSC report: COVID-19 pandemic leads to decline in participation, consumption in electric choice program in 2020
February 01, 2021
FOR IMMEDIATE RELEASE February 1, 2021
Electricity consumption by customers enrolled in Michigan’s electric choice program declined by 58 megawatts (MW) in 2020, reflecting decreased electricity use by commercial and industrial customers amid the COVID-19 pandemic, according to the Michigan Public Service Commission’s annual Status of Electric Competition report.
Choice customers had about 1,958 MW of electric demand, down from 2,016 MW in 2019, while the number of customers participating in the program also declined to 5,706 from 5,817 during the same period, the report found. Nearly all electric choice participants are commercial and industrial customers such as large manufacturers, retailers, health care facilities, restaurants and schools. Given the decline in demand, utilities may adjust future participation levels based on availability.
The state’s utility service market was opened to competition through the Customer Choice and Electricity Reliability Act of 2000. The act permits a limited number of customers to buy electricity from either their local electric utility or an alternative electric supplier. The amount of electric load that could be designated through the choice program was limited to 10% of an electric utility’s average weather-adjusted retail sales for the preceding calendar year, under Public Act 286 of 2008.
There were 24 licensed alternative electric suppliers in Michigan, with eight actively serving customers as of December 2020. About 6,405 customers remained in the queue of those interested in participating in the program if space becomes available under the 10% cap.
Electric choice programs for Consumers Energy Co., DTE Electric Co., Upper Peninsula Power Co., Upper Michigan Energy Resources Corp., Cloverland Electric Cooperative, and Indiana Michigan Power Co. remained at or near their 10% cap for 2020.
The report noted the significant impact the coronavirus pandemic had on the energy industry, particularly early on as many businesses were shut down or reduced operations to help slow the spread of the virus. Calculations in the report were affected by these factors and may not accurately reflect normalized load data.
The MPSC’s Customer Choice webpage has customer, supplier and program information about electric choice participation for each utility.
Michigan is one of 20 jurisdictions that had full or limited restructuring of retail electric markets in 2020.
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