Settlement to Set Reservation Charge Applicable to Choice Customers at Michigan Gas Utilities

Parties have reached a settlement to establish a new level for the reservation charge applicable to choice customers at Michigan Gas Utilities Corporation (MGUC)

Under the settlement, the reservation charge would be $0.6731 per Mcf for the 2012-2013 Gas Cost Recovery (GCR) planning period from April 2012 through March 2013.

Additionally, the settlement would establish a base GCR factor of $3.9353 per Mcf, comprised of a $3.2622 per Mcf commodity charge to GCR customers, and the reservation charge of $0.6731 per Mcf, which would be paid by both GCR and choice customers.

The settlement also provides that parties will convene a technical conference by September 2012 to discuss MGUC's sales forecasting methodologies, the underlying data used to compute and validate the forecast, and the 2013-2014 hedging strategy. When projecting the cost of gas in future GCR plan filings, MGUC will use a 12-month rolling average adjusted basis differential, the settlement provides.

Signatories include MGUC, Michigan PSC Staff, the Residential Ratepayer Consortium, and the Attorney General.

Docket: U-16920