During 2008, competition in Michigan’s electric market showed a continued decline.  The electric choice program in Consumers Energy Company’s territory experienced a five percent annual increase in electric megawatt (MW) load, but over a two percent decline in the number of choice customers.  Conversely, the electric choice program in The Detroit Edison Company’s territory saw a 38 percent annual MW load decline and an over 26 percent decline in the number of choice customers.  This decline in electric choice was attributed, in part, to higher wholesale electricity prices.

To date, Michigan remains one of about 20 States that has a full or limited restructuring of the competitive electric market, but Michigan has retained its reasonable rates.  In comparison to the 10 largest U.S. states, Michigan was benchmarked as having the fourth lowest average retail electricity rates for residential customers, the fifth lowest for commercial customers, and the third lowest for industrial customers.

In 2008, the Commission issued 158 orders to further establish the framework for Michigan’s electric customer choice programs and implement the provisions of PA 141 and the new energy legislation, Public Act 286 and 295 of 2008.

Highlights of the report include:

• Approximately 3,717 commercial and industrial customers in the Detroit Edison and Consumers Energy service territories participated in Michigan’s customer choice programs, representing 770 MW of total sales.
  
• Over three percent of electricity sales in the Detroit Edison and Consumers Energy service areas were supplied by Alternative Electric Suppliers (AES), down from about four percent in 2007.
  
• There were 26 licensed AESs in Michigan during 2008.
  
• Electric standards and practices were revised to lower deposits required of small business customers and to establish an informal complaint resolution process.
  
• The Low-Income Energy Efficiency Fund grants awarded $62 million for low-income financial assistance, $10 million for low-income energy efficiency, $12 million for general energy efficiency, and $6.5 million for energy efficiency technologies.
  
• The Wind Energy Resource Zone Board and the Michigan Planning Consortium were created.
  
• A pilot program to integrate plug-in hybrid electric vehicles into Michigan’s electric grid was initiated through the Smart Grid Collaborative.
  
• Constellation NewEnergy, a licensed AES, continued to offer a “Green-e Renewable Energy” product; and Spartan Renewable Energy LLC, a licensed AES, allowed customers to pay a premium for power from renewable energy resources.

The Customer Choice Program activity is incorporated in the specific utility charts updated monthly for Consumers Energy and Detroit Edison. The charts shows cumulative number of customers, MW, enrolled and in-service on an eighteen month rolling forward basis. The most current monthly information is listed in the last column of each chart.

Sheila Cornfield
Financial Analysis & Customer Choice Section
Regulated Energy Division (517) 335-1600
Michigan Public Service Commission
cornfields@michigan.gov
(517) 335-5539

OR

Audrey Weber
Financial Analysis & Customer Choice Section
Regulated Energy Division (517) 335-1600
Michigan Public Service Commission
webera4@michigan.gov
(517) 241-0967

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