MPSC Authorizes 5% DTE Rate Hike

The Michigan Public Service Commission (MPSC) authorized DTE Electric (DTE) on December 11 (Case No. U-17767) to increase its electric rates by $238.2 million annually – a figure 36 percent below the $370 million that the utility initially had requested a year ago.

“Customers will benefit from improvements in the reliability and safety of DTE Electric Company’s electric distribution system and the acquisition of two natural gas-fired plants to generate electricity,” MPSC Chairman John D. Quackenbush said. “The rates approved today are 36 percent below what the utility requested, and will result in a more reliable system, a cleaner environment, and rates that reflect the ongoing effort toward affordability.”

Effective December 17, residential customers using 500 kilowatt-hours (kWh)of electricity a month began seeing an increase of $8.22 on their monthly bills over rates set in the last rate case, which was in October 2011. Rates for commercial customers have increased by 3.4 percent, and industrial customers are enjoying a decrease of 2.4 percent.

In arriving at the new rate the MPSC denied several DTE requests – among them

• Recovery of deferred costs associated with obtaining a license for a possible Fermi 3 nuclear power plant of $101.9 million over a 20-year amortization period;
• Rate recovery for the utility’s supplemental retirement plan and executive supplemental retirement plan; and
• An increase in the monthly r4esidential customer charge(keeping it at $6). for such items as equipment and maintenance

In addition the commission approved a reduction of $4.8 million to the utility’s nuclear surcharge.

The total amount approved by the commission represents an increase of 5.3 percent over the rates set in its previous DTE electric rate case (Case No. U-16472).