|Laura Chappelle, Chairman || Mary Jo Kunkle|
|David A. Svanda || 517-241-3323|
|Robert B. Nelson|| |
LANSING, December 20. The Michigan Public Service Commission today
adopted a methodology for calculating net stranded costs for Michigan's
electric utilities. Under the adopted methodology, proposed by MPSC staff,
the Commission computes net stranded costs as the difference between the
revenue requirements associated with fixed generation assets, generation-
related regulatory assets, and capacity payments associated with purchase
power agreements and the revenues available to cover those costs. The
Commission adopted the MPSC's proposed methodology because it provided the
most direct approach to determining net stranded costs. The Customer Choice
and Electricity Reliability Act of 2000 requires that the Commission determine
the net stranded costs created by permitting customers to purchase generation
services from alternative electric suppliers.
Today's order establishes the stranded cost charges to be in effect on
January 1, 2002, and sets the charge at zero for both Consumers Energy Company
and The Detroit Edison Company. The Commission indicated that the utilities
may offer and support adjustments, consistent with the approved methodology,
for calculating stranded cost charges for 2003.
"This order will allow customers who choose an alternative provider of
electricity to offer their best price and will promote competition in Michigan,"
said Chairman Laura Chappelle.
MPSC staff, Consumers Energy, Detroit Edison, the Association of
Businesses Advocating Tariff Equity, Energy Michigan, Attorney General Jennifer M.
Granholm, the Midland Cogeneration Venture Limited Partnership, Indiana Michigan
Power Company, Northern States Power Company-Wisconsin, d/b/a Xcel Energy,
Wisconsin Electric Power Company, Edison Sault Electric Company, Wisconsin Public
Service Corporation, Upper Peninsula Power Company, Citizens for Power and
Reliability, Unicom Energy, Inc., Alpena Power Company, the Michigan Independent
Power Producers Association, CMS Marketing, Services and Trading Company, and CMS
MS&T Michigan L.L.C., Dow Corning Corporation, Hemlock Semiconductor Corporation,
North American Natural Resource, Inc., Genessee Power Station, L.P., Viking Energy
of Lincoln, Inc., Viking Energy of McBain, Inc., Hillman Power Company, LLC,
Adrian Energy Associates, LLC, Grayling Generating Station Limited Partnership,
Michigan Cogeneration Systems, Inc., Sumpter Energy Associates Limited Partnership,
Granger Electric Company, Riverview Energy Systems, Cadillac Renewable Energy, LLC,
and Michigan Power Limited Partnership participated in the proceeding.
The MPSC is an agency within the Department of Consumer and Industry
Case No. U-12639
December 20, 2001
(MPSC establishes methodology to calculate net stranded costs and sets 2002