Michigan regulators urge lawmakers to halt yearly utility hikes and revamp profit rules

The Michigan Public Service Commission sent a detailed recommendation to Governor Gretchen Whitmer urging legislation that would end the practice of yearly rate hikes for the state’s two largest utilities, DTE Electric and Consumers Energy. The commission said the existing system incentivizes costly capital projects rather than cheaper maintenance or better use of existing assets. Its proposals include multiyear rate plans linked to performance metrics, requirements that utilities demonstrate higher utilization of current grid lines before building new ones, and reductions in bonuses collected when utilities buy power from external developers.

Additional suggestions cover mandatory low-interest refinancing for closed plants, codifying data-center cost rules, granting authority for virtual power plants, and requiring competitive bidding for transmission projects. The commission also recommended aligning low-income assistance thresholds with the Michigan Energy Assistance Program and creating a tax credit for home weatherization. Lawmakers would need to act for most changes to take effect.