We work to provide reliable and safe energy services at rates as low as possible. We offer a variety of rate options to serve your unique needs. Our electric and natural gas services are regulated by the Michigan Public Service Commission (MPSC).
How Electric Rates Are Set
Michigan Energy Rates
What Costs are Included in Rates
Rates are generally split into three parts:
- Major investments that generate and deliver energy. This includes the operation of power plants, electric distribution (poles and wires) and natural gas pipelines. There are also upgrades to stay up to date with environmental regulations that fall under this.
- Operating expenses. This includes fuel for power plants (such as coal and natural gas), the cost of electricity or natural gas that we purchase from the energy market and maintenance, repair, service and billing.
- Michigan energy programs. These programs support areas such as energy efficiency and renewable energy.
Residential Electric Charges
As a residential customer, you have two types of charges on your electric bill: Power Supply and Delivery Service.
Power Supply
Power Supply charges include costs related to creating the electricity and moving the electricity over high voltage transmission lines. The Power Supply costs you pay are directly related to how much electricity you use. This is measured in kilowatt-hours (kWh).
In some of our rates, you may pay a different amount per kWh of electricity. This will depend on the time of the year and how much energy you use. Here is an example using our most common residential rate:
- During winter months (October - May) the price for each kWh remains the same, no matter how much you use.
- During summer months (June -September) there is higher demand, which mostly comes from air conditioner use. This demand makes it more expensive to create or buy electricity. To help reduce energy use during these months, the cost of electricity increases at certain times. This price increase helps keep everyone’s costs down because it helps avoid expensive energy and system upgrades that would otherwise be needed and increase our shared cost.
Energy Delivery
Delivery Service charges are related to providing customer services and local energy distribution.
- System Access: This is a fixed fee of $8.00 per month. This fee covers costs related to meters and billing.
- Distribution: This charge is related to delivering electricity from the transmission system to your home. This includes necessary equipment, maintenance and operating expenses.
- Energy Optimization: This monthly per kWh fee supports Energy Efficiency programs that are included in Michigan’s energy laws. These programs help avoid costly investment in new energy sources by reducing household energy use.
- Other charges on your bill may vary.