MPSC approves Upper Peninsula Power Company electric rate increase, customers to see refund
LANSING, Mich. – (RealEstateRama) — The Michigan Public Service Commission (MPSC) on Sept. 8 authorized Upper Peninsula Power Company (UPPCo) to increase its electric rates by $4,647,975 annually, a figure 30.4 percent below what the utility requested. Also, because the final amount approved was lower than the $6,259,025 the utility self-implemented in March, some customers will see a rate decrease, effective Sept. 23. By state law, customers who paid more than the currently approved amount will also get a refund of the difference between what the utility self-implemented and the MPSC granted, plus interest, in the future.
UPPCo sought a rate increase of at least $6,681,312 annually.
As a result of the September 8 order (Case No. U-17895), residential customers using 500 kilowatt-hours of electricity a month will see an increase of $7.63 (6.81 percent) on their monthly bills over rates set in the last rate case, which was in December 2013.
The total amount approved represents an increase of 4.47 percent over the rates set in its previous electric rate case (Case No. U-17274).
A fact sheet with details is below.
Upper Peninsula Power Company
Case No. U-17895
Commission Order Fact Sheet
- Revenue increase granted: $4,647,975
- Rate of return on common equity: 10 percent
- Capital structure: 44.7 percent debt; 55.3 percent equity
- Overall rate of return: 7.47 percent
- Directed the utility to make distribution capital expenditures of $10.55 million or to refund any unexpended amounts to its customers.
- Directed the utility to make distribution operations and maintenance expenses of $12.9 million total, including $3.2 million for previously-mandated line clearance or to refund any unexpended amounts to its customers.
- Approved uncollectible accounts expense of $568,188.
- Disallowed 100 percent of UPPCo’s incentive pay portion of total cash compensation.
- Approved a monthly residential service charge of $15.
Case No. U-17895
For more information about the MPSC, please visit www.michigan.gov/mpsc or sign up for one of its listservs to keep up to date on MPSC matters.
Contact: Judy Palnau, 517-284-8300
