Electric Choice Spreads To Two New Utilities

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For the first time in eleven years, electric customers in the Indiana Michigan Power Company (I&M) and the Upper Peninsula Power Company (UPPCo) service territories participated in Michigan's electric choice program. Alternative Energy Suppliers began serving 120 customers in the I&M service territory, and 4 customers in the UPPCo service territory. There were 5,672 choice customers in the Detroit Edison service territory, and 1,064 choice customers in the Consumers Energy service territory.  Michigan has 26 licensed AES companies. As of the end of 2012 there were approximately 10,450 customers statewide "in the queue" to participate in the choice program when and if space opens. There is currently a 10 percent cap (10% of an electric utility's average weather-adjusted retail sales) on participation

So far very few residential customers have availed themselves of the customer choice opportunities, or have joined the queue hopping for a change in the law.  This is primarily a program for industrial and commercial customers.  As such any expansion of the cap runs the risk of raising rates for "left behind" residential customers. But a well structured transition to larger and larger customer choice carve outs can prevent negative impacts on those residential customers. Michigan was once on the path to retail deregulation. It can get there again, with care planning.

 


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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