MPSC Investigates Estimated Billing by Consumers Energy

by | Jan 27, 2016

The Michigan Public Service Commission (MPSC) opened an investigation (Case No. U-18002) at its January 19 meeting into Consumers Energy’s estimated billing practices, after fielding more than 277 consumer complaints about price gouging on estimated bills during 2015, alone.

In doing so, the commission directed the utility to file a report by February 18, and directed the MPSC staff to supply its analysis and recommendations by May 18.

Consumers Energy is the Wolverine State’s largest utility, serving over 6 million electric and gas customers in 61 counties statewide. The utility estimates its gas and electricity bills, spokesperson Brian Wheeler told the news organization MLive, when it cannot gain access to the customer’s meter as a result of inclement weather, property inaccessibility, or safety hazards. Such calculations are based on the customer’s past energy usage and patterns, and are labeled as such on the monthly bill.

In 2015, Consumers Energy estimated meter reads for a large number of customers. In its order, the MPSC reports that, in one specific instance Consumers indicated that it admittedly estimated meter reads for 49,000 meters for periods of three months or more. Of those 49,000 meters, the company estimated meter reads for a period of 12 months or longer for 13,000 meters.

However, a utility may only estimate a customer’s bill if the MPSC finds that the utility’s estimation procedures assure reasonable billing accuracy. To date, that has not been the case.

“The Michigan Public Service Commission continues to hear complaints from Consumers Energy Company customers about estimated bills,” noted MPSC Chairman Sally Talberg. “Problems have persisted for several years, despite repeated meetings between the MPSC staff and the utility to reduce the number of estimated bills. Therefore, the commission today has commenced an investigation that requires the utility to provide detailed explanations about its estimated billing practices.”

Specifically, the MPSC order directs the utility to report on eight areas – among them:

  • Performance history regarding its meter reading factor,
  • The impact of certain software on billing issues related to estimated meter reads,
  • Meter reading staffing levels,
  • Communications with customers regarding estimated reads,
  • How many customers the utility under- or overestimated during the summer tiered rate period,
  • How many variable rate alternative gas supplier customers for whom Consumers estimated meter reads during the heating season,
  • What the utility is doing with any customer service write-offs related to estimated billing, and
  • The utility’s plans going forward to address the practice of estimated billing.

The commission reserves jurisdiction and may issue further orders, as necessary. Customers with concerns about estimated billing or who are interested in commenting on this case may contact the Michigan Agency for Energy’s compliance and investigation section  at 800-292-9555.

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