Michigan Public Service Commission considers charge to fund incentive program for utilities
LANSING, Mich. (CBS DETROIT) - The Michigan Public Service Commission is toying with a proposal that would reward utilities with more money from a $10 yearly charge to consumers for improved performance.
"We do not believe utilities should ever be incentivized for providing subpar performance, period. Full stop," said Missy Stults, the director of sustainability and innovations for the city of Ann Arbor.
That extra charge of $10 each year would equal incentive funds of about $23 million for DTE Energy and $19 million for Consumers Energy.
"We had multiple days last year where a fire station was without power. That is simply unacceptable," said Stults. "We also know that we've heard our utilities at shareholder meetings bragging about the fact that they have returned more money to their investors by not investing in operations and maintenance. That's a problem, right? This idea that we would provide incentives for utilities for not even meeting this basic level of performance that the Public Service Commission has established. Absolutely not."
The Michigan Public Service Commission told CBS News Detroit they would not conduct an interview on this topic because the proposal is in its very early stages and is only one of many ideas currently being considered.
In a statement, the MPSC said, "The Commission shares in the frustration about power outages in Michigan. The MPSC is examining ways to use every possible tool to improve the reliability and resilience of Michigan's power grid to reduce outages and provide customers the level of service they expect from their electricity provider."
Consumers Energy said it is "participating in the stakeholder process, in which any stakeholder is invited to provide input. We are confident the MPSC will adopt a PBR mechanism which is fair to all stakeholders and designed to achieve the shared goal of improved reliability."
Stults said Michiganders already pay very high rates.
"I think we also have to evaluate what would people actually be willing to pay for better performance," she said. "But only once you get baseline good performance. Are we willing to have that conversation?"
The MPSC will be holding an engagement session on its proposals to improve reliability on Feb. 12.
