Cox celebrating expected rate reduction

John O'Brien Jul. 26, 2007, 3:52pm

LANSING, Mich. - An order from the Michigan Public Service Commission should reduce statewide utility rates by more than $100 million in the near future, Attorney General Mike Cox said Thursday.

The order affects the customers of a handful of power companies. and, according to Cox, was a long time coming.

"I requested the (MPSC) to reduce the amount of depreciation costs charged to natural gas customers of Consumers Energy Co. and Michigan Consolidated Gas Co.," Cox said. "The Commission did not take action in those cases.

"Instead, the Commission started a new accounting case involving all Michigan electric and gas utilities. Now, two years and nine months later, the Commission issued a final order in that case."

Cox says the order agrees with the arguments he presented before the MPSC, dictating that the current practice of estimating depreciation costs is no longer suitable for determining charges to remove major equipment such as power plans and pipelines.

Consumers Energy Co., Michigan Consolidated Gas, SEMCO Energy Gas, Michigan Gas Utilities Corp. and The Detroit Edison Co. must file applications in new cases staggered over 2008-09. They must present new methods for calculating future costs to remove equipment.

"Based upon evidence developed in previous cases, I expect customers of all the utilities will see rate reductions totaling more than $100 million by the time the various cases are completed," Cox said. "Action has come too slowly, but thankfully this breakthrough will eventually provide relief to help customers pay their utility bills."

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