Michigan’s utility regulator is asking state lawmakers to end the cycle of yearly rate increases and rewrite the way utilities earn profit. The Michigan Public Service Commission (MPSC) released recommendations that were detailed in a letter sent to Gov. Gretchen Whitmer. The core of the letter is an argument that many ratepayer advocacy groups have been making for years: that Michigan’s regulatory model pays utilities a return on what they build, which pushes them toward expensive capital projects and away from cheaper options like tree trimming, maintenance, or better use of existing infrastructure.

Recommendations

The commission wants authority to set multiyear rate plans tied to performance on reliability and affordability metrics. Other recommendations include aligning low-income rate eligibility and LIHEAP-funded programs with the Michigan Energy Assistance Program (MEAP) threshold of 60% of state median income. The MPSC also recommends redesigning the Home Heating Credit and creating a tax credit covering up to half the cost of home weatherization work.

The recommendations follow a June 11 commission order setting a goal that no Michigan household spend more than 6% of its income on energy. The MPSC staff plans to take up the question of plug-in solar systems, which are technically already allowed under utilities’ existing distributed generation programs, but may be too expensive due to interconnection studies.

Legislative Action

Rep. Will Snyder introduced House Bill 5764 in March, which would let customers install systems up to 1,200 watts without an interconnection agreement or utility approval. The Sierra Club is also pushing companion Senate bills 731 and 732. Legislation is required to advance most of these items, as the commission can’t create multiyear rate plans or change the bonus system on its own.

Original reporting: Alexandria, VA News – WTOP News — read the source article.