Coalition says Public Service Commission failed ratepayers in DTE rate case decision
COMMISSION GRANTED $368 MILLION OF DTE’S REQUEST FOR $622 MILLION MORE FROM RATEPAYERS AFTER YEARS OF UNRELIABLE, UNAFFORDABLE SERVICE
DETROIT, MI — A coalition of energy democracy and consumer advocacy groups says the Michigan Public Service Commission (MPSC) has failed ratepayers by approving a $368 million electric rate increase for DTE Energy today, 59% of the $622 million the utility had requested. Based on more than 1,000 public comments submitted to the MPSC on the rate case, along with testimony from residents across the state at hearings this year on power outages and energy reliability, Michigan residents were overwhelmingly opposed to any rate hike after years of poor reliability, unaffordable rates, and thousands of shut-offs.
“DTE’s request for more than half a billion dollars was unconscionable and unjustifiable,” said Rafael Mojica, Program Director at Soulardarity. “Any increase to residential ratepayers is unjust, as the burden will fall most heavily on low-income communities and communities of color who already pay a disproportionately high share of income on utilities.”
The commission could have eliminated or substantially reduced a residential rate hike by reducing the utility’s guaranteed shareholder returns. The approved $368 million rate hike with a 9.9% Return on Equity (ROE) still results in ratepayers directly funding more than $1 billion in profits for DTE shareholders. A recommendation from an administrative law judge issued in October suggested lowering this to 9.8% while stating it would be reasonable for the MPSC to consider an ROE as low as 8.4%. The administrative law judge also recommended that the commission reduce the amount to $290 million.
“While it’s a relief that the commission recognized the absurdity of DTE’s original request, this was an opportunity for the MPSC to truly hold the utility accountable for failing to provide reliable, affordable, and equitable service,” said Erik Shelley, Environmental Justice Organizer for Michigan United. “Sadly, the commission squandered that opportunity by approving yet another rate increase.”
“Regulators, legislators, and the Governor must do more to safeguard ratepayers from DTE’s long record of poor service and putting profits over people,” Shelley continued.
DTE has plans to file a gas rate hike in February 2024 and advocates expect another electric rate hike request from the utility next year as well.
Coalition members include Emergent Justice, Engage Michigan, Michigan Environmental Justice Coalition, Michigan Interfaith Power & Light, Michigan League of Conservation Voters, Michigan United, Sierra Club, Soulardarity, and We Want Green Too.