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MPSC approves Consumers Energy power supply cost recovery reconciliation of $1.96 million, disallows plant outage costs
August 11, 2022
Media contact: Matt Helms 517-284-8300
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The Michigan Public Service Commission today approved Consumers Energy Co.’s reconciliation of its 2020 calendar year power supply cost recovery (PSCR) expenses and revenues, but rejected the utility’s requested recovery of more than $2 million in costs stemming from outages at the Ludington Pumped Storage and J.H. Campbell plants (Case No. U-20526).
Today’s order sets a net underrecovery balance of $538,343 as the utility’s 2021 PSCR recovery beginning balance.
Today’s order approved cost recovery of $15,301,157 in capped and uncapped expenses for biomass merchant plants Cadillac Renewable Energy LLC, Genesee Power Station Limited Partnership, Grayling Generating Station, Hillman Power Company LLC, TES Filer City Station Limited Partnership, Viking Energy of Lincoln LLC, and Viking Energy of McBain LLC. The order also approved accounting for incurred nitrogen oxide and sulfur oxide expenses as part of the uncapped calculation of the biomass merchant plant adjustment. The order also found that accounting for nitrogen oxide and sulfur oxide expenses incurred shall be part of the uncapped calculation of the biomass merchant plant adjustment.
The Commission disallowed recovery of:
- $1.36 million in replacement power costs owing to an extended outage related to the 2019 overhaul of Unit 3 at the Ludington Pumped Storage Plant on Lake Michigan south of Ludington, jointly owned by Consumers Energy and DTE Energy. Consumers and DTE have been involved in a dispute with contractor Toshiba America Energy Systems Corporation over delays in the project and a defective discharge ring extension manufactured and installed by the contractor. The Commission also adopted the recommendation of the administrative law judge in the case that Consumers apply $1.36 million of the $9 million Consumers Energy and DTE Energy have received in liquidated damages in the case toward Consumers’ PSCR expense for 2020.
- $650,212 for a 24-day outage at the Campbell plant in Ottawa County after the bearing failure of an auxiliary oil pump resulted in the shutdown of Unit 1, finding that the company did not provide evidence warranting recovery of replacement power costs.
- $21,372 for lost energy costs for 3,978 megawatt hours over 15.3 hours at the utility’s Campbell plant, caused when a contractor performing an upgrade inadvertently closed the wrong breaker, resulting in Unit 1 tripping offline, a mistake MPSC Staff said happened because of Consumers having inadequate plans and procedures in place for the upgrade.
In addition to the biomass merchant plants, intervenors in the case were the Michigan Department of Attorney General; the Residential Customer Group; Michigan Cogeneration Venture Partnership Ltd., and the Association for Businesses Advocating Tariff Equity. MPSC Staff also participated.
MPSC unveils E-Dockets comment button to make it easier for public to submit comments on cases before the Commission
The MPSC has made it easier for the public to submit comments on cases before the Commission, unveiling a new comments button in the MPSC’s E-Dockets system, the electronic repository for all public filings in regulatory matters overseen by the agency.
A new “Submit Comment” button is located near the top of the page when users of the E-Dockets system navigate to a specific case. Users clicking the button are reminded that comments submitted to the MPSC become a matter of public record, will be posted in the case docket and subject to disclosure, before being directed to a New Case Comment form.
The form requires a commenter to submit their first and last names and email address and has optional fields for them to submit the city and state where they live, their ZIP code, and the organization they represent, if applicable, along with the comment; users also may submit a PDF attachment. Once the identifying information and comment are completed, users click the confirm button, and the comment is submitted to MPSC Staff for review to ensure personal identifiable information is redacted before it is posted online in the case docket. Users are reminded, as well, not to include information in their comments that they wish to remain private.
“We are continually looking at ways to make public participation in proceedings at the MPSC easier and more convenient, and this new method for submitting comments adds a simpler way for Michiganders to have their voices heard,” MPSC Chair Dan Scripps said.
The public may continue to submit comments by mail or email to the MPSC. Comments may be mailed to Executive Secretary, Michigan Public Service Commission, P.O. Box 30221, Lansing, MI 48909, or e-mailed to email@example.com. All comments should reference the appropriate case number.
Indiana Michigan Power energy waste reduction plan approved pending changes
The MPSC today approved Indiana Michigan Power Co.’s (I&M) 2022-2023 energy waste reduction (EWR) plan, subject to the utility agreeing to modifications (Case No. U-20877).
The Commission approved I&M’s EWR plan revenue requirement of $12,188,967 for operating costs including program rebates, customer education, plan administration, information technology support and marketing. EWR is a requirement of Michigan’s energy laws for natural gas and electric utilities to implement customer programs that lower energy use to reduce the future cost of service.
The Commission found the company’s proposed savings targets of 1.42% for 2022 and 1.48% for 2023 reasonable and prudent and significantly higher than I&M’s achieved savings in recent years. The Commission, noting that the company’s performance in 2020, at 0.7%, was “abysmal” and below the statutory minimum, indicated it would further review I&M’s EWR targets in its integrated resource proceeding in Case No. U-21189 and may amend approved savings targets depending on determinations in that case.
The Commission found that I&M’s proposed reliance on customer behavior-based savings contributions makes up too large a proportion of the utility’s energy waste reduction program, compared to more durable physical approaches such as more efficient appliances and building improvements. The Commission continued to cap I&M’s behavioral savings contributions at 15% for 2022 and 2023, also directing the utility to work with MPSC Staff to ensure appropriate evaluation and reporting of savings the company claims based on customer behavior.
The Commission also:
- Directed I&M to participate in the Michigan Energy Assistance Program, which provides energy assistance and self-sufficiency services to income-qualified households, and to work with MPSC staff to develop a customer data collection methodology to help the company improve its EWR program and delivery of weatherization services and other assistance for customers most in need.
- Directed the utility to work with MPSC Staff to better the company’s low-income programming, which the Commission found has much room for improvement. The Commission declined to recommend I&M increase its spending on income-qualified customers, despite historical spending continuing to decline.
- Recommended that I&M include an evaluation of on-bill repayment options for customers to finance residential energy efficiency improvements in its next EWR plan case and to work with MPSC Staff to evaluate options.
MPSC MOVES AHEAD ON PROPOSED REVISIONS TO RATE APPLICATION FILING REQUIREMENTS
The Commission today directed MPSC Staff to file initial proposed revisions to the MPSC’s standard rate application filing form requirements enacted after the 2016 update to Michigan’s energy laws (Case No. U-18238). The Commission in March 2021 kicked off a review of the requirements, and today directed MPSC Staff to file a draft proposal by Oct. 7, 2022, and a final proposal by Jan. 10, 2023. The Commission also set a collaborative proceeding to be held Nov. 17, 2022, on the proposed revisions. Utilities, stakeholders and others wishing to participate in the collaborative must submit a letter to the Commission’s Executive Secretary by Nov. 3, 2022, identifying the names and contact information of representatives. The Commission set a deadline of 5 p.m. Nov. 3, 2022, for initial comments on the MPSC Staff initial proposed revisions and 5 p.m. Feb. 10, 2023, for comments on the final proposal. Comments may be submitted in Case No. U-18238 using the system’s new comment button; mailed to Executive Secretary, Michigan Public Service Commission, P.O. Box 30221, Lansing, MI 48909, or emailed to firstname.lastname@example.org. Comments should reference Case No. U-18238.
COMMISSION APPROVES CONSUMERS ENERGY STREETLIGHT OUTAGE CREDIT TARIFF AMENDMENT
The MPSC gave the nod today to Consumers Energy Co.’s revised application for a tariff amendment for streetlight outage credits (Case No. U-21203). Under the revised language, Consumers will apply an outage credit, within 90 days of service restoration, to a customer’s bill for out-of-service lighting that includes the monthly cost per light and applicable surcharges prorated for the duration of the outage beginning the date the outage was reported and documented and ending the date service is restored.
To look up cases from today’s meeting, access the MPSC’s E-Dockets filing system.
Watch recordings of the MPSC’s meetings on the MPSC’s YouTube channel.
For information about the MPSC, visit www.michigan.gov/mpsc, sign up for its monthly newsletter or other listservs. Follow the Commission on Facebook, Twitter or LinkedIn.
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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