Energy Charges Explained

Electric Charges Explained

Understanding electric rates

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Natural Gas Charges Explained

Understanding natural gas rates

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Michigan Energy Rates

We work to provide reliable, safe and economical energy services and offer a variety of rate options to serve your unique needs. Like all Michigan utilities, the electric and natural gas services we deliver are regulated by the Michigan Public Service Commission (MPSC).

Making A Difference

Working together to control costs; what we are doing and what you can do.

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The Average Home Energy Cost is $3.00 a Day

That's less than the daily cost of cable TV, a combo meal or a specialty coffee! 

What Costs are Included in Rates

Generally speaking, rates are divided into three parts:

  1. Major investments that generate and deliver energy, including the operation of power plants, electric distribution (poles and wires) and natural gas pipelines. This includes upgrades to stay current with environmental regulations.
  2. Operating expenses including fuel for power plants (such as coal and natural gas), the cost of electricity or natural gas we purchase from the energy market and activities related to maintenance, repair, service and billing.
  3. Michigan energy programs supporting 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. 

Learn more about these charges below:

Power Supply charges include costs associated with creating the electricity and moving the electricity over high voltage transmission lines. The Power Supply costs you pay are directly related to the amount of electricity you use, which is measured in kilowatt-hours (kWh).

In some of our rates, you may pay a different amount per kWh of electricity depending on the time of the year and the amount of energy you use.  Here's 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) the increased demand - mostly from air conditioners - makes it more expensive to create or buy electricity.  To help reduce energy use during these months, the cost of electricity increases if you use over 600 kWh per month.  This price increase actually 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.
Learn More About Your Bill.
Delivery Service charges are associated with providing customer services and local energy distribution.
  • System Access: This is a fixed fee of $7.00 per month, which covers costs associated with metering and billing.
  • Distribution: This charge is associated with delivering electricity from the transmission system to your home including necessary equipment, maintenance and operating expenses. Distribution costs are adjusted based on how much electricity you use.
  • Energy Optimization: This is a 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.
  • Renewable Energy Plan: This is a fixed fee for every meter. The fee helps meet Michigan’s renewable energy standards.
  • Other charges on your bill may vary.
Learn More About Your Bill.

Residential Natural Gas Charges

Your natural gas bill includes three primary charges.  Below is a description of each:

  • Gas Cost Recovery: The cost of the natural gas itself, which is measured in thousand cubic feet (Mcf). This is usually about 65% of your total bill and includes only what we pay for the natural gas.  We also help reduce the price you pay by purchasing most of the natural gas you need during the summer when prices are low and storing it underground until you need it. 
  • Distribution: Charges include operation and maintenance expenses for pipelines and storage. This fee varies by month, but is usually about $2.70 for most residential customers.
  • Customer: Charges include billing and metering that are necessary to serve our customers.  This is a fixed charge of $11.50 per month.

To view the current price that we pay for natural gas and pass along without a markup, see below.

The following is an 18-month review of the Gas Cost Recovery charges, including our current month price per Mcf.

Month/Year Price/Mcf - Gas Cost Recovery
April 2017 $3.1910
March 2017 $2.9951
February 2017 $2.9951
January 2017 $3.0357
December 2016 $2.8734
November 2016 $3.0357
October 2016 $2.9546
September 2016 $2.9951
August 2016 $3.0165
July 2016 $2.8507
June 2016 $2.7941
May 2016 $2.7160
April 2016 $2.5351
March 2016 $3.2358
February 2016 $3.1981
January 2016 $3.1645
December 2015 $3.1777

Working together to Keep costs down

Our Cost Controlling Efforts

We strive to provide you with the best product at the best price and are always looking for ways to reduce your costs by:

  • Buying natural gas during the summer when it generally costs less and store it in our underground fields throughout Michigan.
  • Reducing power plant fuel costs by increasing the use of lower-priced Western coal from Wyoming and Montana.
  • Recycling and minimizing waste to help reduce hazardous waste shipments and lower electric generation costs.
  • Currently we recycle more than 20 major types of waste.
  • Our robust line-clearing maintenance program reduces tree related outages and restoration costs.
  • Using a variety of electric generation facilities and running our most efficient units more often.
  • In case of catastrophic storms (180,000 customers or more lose power), we work to get crews from other Midwest energy services to restore service as quickly as possible.

Ways You Can Help Control Cost

You can also help control energy cost by:

  • Get the best rate. Make sure you are on the right rate.
    Check Your Rate
  • Check for credits. We offer credits for residential customers, including for those with a low income, seniors, military and more.
    Review Available Credits
  • Save money through energy efficiency. Discover ways to make your home more energy efficient.
    Get Energy Saving Solutions
  • Manage your bill. Save time and money when you receive and pay your bill online using our convenient options.
    Learn More
  • Manage your household budget. Our Budget Plan offers equal monthly payments.
    See How

Consumers Energy

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Payment Breakdown

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