Consumers Energy requests $456M rate hike; Nessel vows to challenge

The proposal also includes a 12-month surcharge of $25 million, an additional $52 million over three years for storm restoration expenses, and an expansion of a cost recovery mechanism approved in its previous rate case.

If approved as filed, residential electric rates would increase by about 9.8%, according to Nessel's office.

The request comes less than three months after the commission approved a previous rate increase for Consumers Energy. In March, regulators authorized the utility to collect an additional $276.6 million in revenue. As previously reported by The Center Square, that increase translated to an 8.9% rise in residential electric rates, which just hit ratepayers' bills in May.

“Consumers Energy and DTE keep demanding more and more money, the MPSC continues to reward their incessant demands, and the cycle of constant, growing rate hikes are pushing Michigan families and businesses to the brink,” Nessel said in a statement following the announcement.

Nessel said her office will formally intervene in the case, as it routinely does in utility rate proceedings.

“My office will intervene in this case as we always do, but we already know the predictable pattern likely to play out: Consumers Energy loads its rate hike request with completely unsupported, inflated costs, and the MPSC simply splits the difference,” she said. “Michiganders are facing an affordability crisis, and our utility companies are recording record profits.”

Consumers Energy argues the increase is necessary to continue investing in grid reliability and infrastructure.

The increase is part of the company's 2027 Reliability Action Plan, which calls for additional tree trimming, burying 50 miles of power lines underground, upgrading circuits in outage-prone areas and expanding grid-monitoring technology.

“We're making strategic investments every day to ensure we better serve homes and businesses that count on us,” said Greg Salisbury, Consumers Energy's senior vice president of electric distribution.

According to the company, the average customer has experienced a 28% reduction in outage duration since 2021 under normal operating conditions. This increase is hoping to build on that infrastructure improvement.

“These upgrades are critical to build on that,” Salisbury said.

Consumers Energy said there would be no immediate impact on customer bills until the request is approved. The commission has until April 2027 to issue a final decision.

If the proposal is approved in full, Consumers estimates the average residential customer with a monthly electric bill of about $155 would see an increase of roughly $13 per month beginning in May 2027.

The utility said about 75 cents of every customer dollar is reinvested into maintaining and upgrading the electric grid.

“We know cost is top of mind for customers, which is why we’re focused on smart, strategic investments to improve service,” Salisbury said. “We will continue to do all we can to ensure people have access to assistance to manage and pay bills.”

Since 2020, the MPSC has approved nearly $800 million in rate hikes for Consumers Energy, according to Nessel's office.

Consumers Energy provides electricity to about 1.9 million customers and natural gas service to about 1.8 million customers across Michigan.