Michigan Attorney General Mike Cox Files Testimony with Public Service Commission to Save Michigan Consumers Millions

20 February 2006

Attorney General Mike Cox announced today that he has filed testimony with the Public Service Commission (PSC) seeking an adjustment in Michigan Consolidated Gas Company's (MichCon) cost of gas for the next plan year and changes in Consumers Energy Company's (Consumers) emission allowance practices to provide Michigan ratepayers substantial savings in 2006.

The Attorney General also announced that he has received an important win before the PSC with its denial of Detroit Edison Company's application to immediately collect rate increases due to increased retired employee pension costs.

In addition, the Attorney General has filed a brief with the Court of Appeals supporting the PSC's decision to deny MichCon's recovery of $61 million it sought to increase the general rate charged to consumers.

"Michigan citizens are already feeling the effect of this year's increase in winter heating bills, so every dollar counts," said Cox. "My office is fighting to minimize the costs of natural gas and electricity for Michigan ratepayers and to protect their pocketbooks."

On February 10, 2006, Cox filed testimony in MichCon's Gas Cost Recovery Reconciliation case seeking a $697,240 adjustment in MichCon's cost of gas for the April 2006 to March 2007 plan year. Because of several imprudent gas purchasing decisions, MichCon incurred extra costs that it is attempting to pass onto customers through its 2006-07 plan year. Cox seeks to exclude these imprudent costs from the plan year, thus reducing customer natural gas bills for that plan year.

Cox also filed testimony on February 10, 2006, in the Consumers' Power Supply Cost Recovery Case asking the PSC to change Consumers' practices concerning emission allowances to provide Michigan ratepayers an estimated $4.9 million in savings in 2006. Cox's testimony also requests the PSC to examine Consumers' natural gas purchasing decisions and its accounting of certain expenses to assign costs to proper customers, which should reduce costs to a majority of ratepayers.

"Senior citizens and people on a fixed income, especially, need affordable utility rates," said Cox. "My office will continue to fight the energy companies to keep utility costs affordable for everyone."

On February 9, 2006, the PSC issued an opinion adopting Cox's argument that the Detroit Edison Company's Application to Implement an Other Post Employment Benefits Equalization Mechanism Case should be denied in its entirety and addressed in the next general rate case. Detroit Edison Company's application would allow the company to immediately pass on the cost of increased retired employee pension costs onto consumers.

Additionally, on February 9, 2006, Cox filed a brief with the Court of Appeals supporting the PSC's decision denying MichCon's recovery of $61 million it sought to recover in its general rate case. The $61 million involved a control premium that DTE Energy paid to MCN Energy Group, Inc (MCN) to acquire MichCon.

"The Commission properly found that MichCon should not be permitted to pass on the $61 million in merger costs to consumers," said Cox. "Filing the brief with the Court of Appeals supporting the Commission's decision is one way that I can protect Michigan ratepayers from paying increased utility costs."

Attorney General Cox has taken an aggressive approach to challenging utility rate increases on behalf of Michigan consumers and businesses. Cox's Consumer Protection Division has saved Michigan consumers $591 million in 2003, $600 million in 2004, and $444 million in 2005, for a total of $1.64 billion in prevented utility rate increases.

Source: prnewswire

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