Michigan MPSC Approves $276.6 Million Consumers Energy Rate Hike Despite Attorney General Challenge

Michigan Public Service Commission Approves Rate Increase That Will Raise Bills Starting May 1

LANSING — The Michigan Public Service Commission voted unanimously on Friday to approve a $276.6 million rate increase for Consumers Energy, a decision that will raise electric rates for customers by 8.9% and take effect May 1.

The approval came less than two weeks after severe winter weather knocked out power to nearly 260,000 Consumers Energy customers across Michigan, making grid reliability a top concern for regulators.

Rate Hike Details

According to the Michigan Department of Attorney General, the rate increase will cost Consumers Energy customers approximately $9 more per month on average, bringing the average electric bill in Michigan to about $140 per month.

The approved increase represents roughly $160 million less than what Consumers Energy initially requested. The utility had sought a $436 million increase with an additional $24.3 million surcharge, but commissioners ultimately approved a lower amount.

"The bulk of this rate increase goes to improvements in the electric grid that make it more secure, both physically from weather, from physical attacks, as well as cyber attacks," said Consumers Energy Senior Vice President of Regulatory and Legal Affairs Kelly Hall.

Consumers Energy said the investment is included within the company's 2026 Reliability Action Plan. Other key projects under the plan include:

• Increasing line clearing efforts to remove trees and limbs from around power lines
• Installing taller and stronger electric poles
• Increasing monitoring of the electric grid to detect and reduce outage impacts

MPSC Commissioner Comments

Commissioner Katherine Peretick noted that while the company has made substantial investment proposals, there were significant concerns from interveners about whether all spending is sufficiently tied to measurable outcomes or justified on a cost-to-benefit basis.

"The record in this case reflects Consumers substantial investment proposals, but also significant concerns from intervenors that not all spending is sufficiently tied to measurable outcomes or justified on a cost-to-benefit basis," Peretick said. "As highlighted in the record, many customers are already struggling to pay their utility bills, and it is imperative for the utility to prioritize investments that deliver the greatest reliability improvements per dollar spent."

MPSC Chair Dan Scripps described the order as representing "a balanced order that provides meaningful support for ongoing reliability-based investments, while being mindful of the affordability concerns that are always front and center."

Attorney General Criticizes Decision

Michigan Attorney General Dana Nessel criticized the rate increase as "unsustainable," following a $154 million rate increase for Consumers Energy approved in March 2025. Her office has argued that the MPSC has now approved nearly $800 million in annual revenue increases for Consumers Energy since 2020.

"Consumers Energy customers will once again have to brace for higher bills because of the never-ending cycle of rate hikes passed on by the utility," Nessel said in a Friday statement. "Unfortunately, this is something we have become accustomed to."

Nessel's office has carefully reviewed both DTE and Consumers Energy rate hike requests for "bloated and unjustified costs," but ultimately the MPSC determines how much to approve or how often these rate hikes occur.

"This process continues to place the burden on ratepayers and demands greater accountability to ensure Michiganders receive the affordability and reliability they deserve," Nessel said. "I urge our elected leaders of both parties to reconsider this badly broken system. It's both unfair and unsustainable for our state."

DTE Energy Rate Hikes

The MPSC's approval came just days after DTE Energy received additional revenue from several approved rate hikes. DTE's latest rate hike, approved in February, will collect $242.4 million more from Michigan customers.

The Citizens Utility Board of Michigan has long highlighted concerns about electric reliability in the state. In a report from last fall, the CUB found that while electricity prices in the residential sector were higher in some other states in 2023, Michigan performed worse than every other state and D.C. on its index measuring average power restoration time. The report noted that Michigan bested only one state when it came to total outage duration for each customer served.

Statewide Concerns About MPSC

The rate hike decision has reignited debate about how MPSC members are chosen. State lawmakers, including Republican State Senator Michele Hoitenga (R-Manton), have called for reforming the commission and changing how its members are appointed.

Hoitenga introduced Senate Bill 587 in September 2025, which would allow the legislature to hold oversight hearings for utility rate increases. While Hoitenga has placed blame with the Democratic-controlled Senate for stalling her bill, she argues that the governor-appointed MPSC members should face additional scrutiny.

"The bill, introduced in September 2025, would allow the legislature to hold oversight hearings for rate increases," Hoitenga has said. "By statute, the governor-appointed MPSC members are responsible for approving all rate increases. But wouldn't it be prudent for the legislature to hold transparent oversight hearings for any rate increases?"

Looking Ahead

Consumers Energy plans to file its 2027 Reliability Action Plan in June with the MPSC. The utility has maintained that its rate increases are necessary to maintain and upgrade electrical infrastructure across Michigan's vast service territory.

The rate increase takes effect May 1, and the company will begin collecting the additional revenue from customers at that time.