Testimony: Michigan Consumers Pay $1.8 Billion Extra For Electricity Annually Under Choice Cap

Testimony before the Michigan House Energy and Technology committee claimed that Michigan electric customers are paying $2 billion in higher costs as a result of the 10% electric choice cap, Energy Choice Now said yesterday.

Philip O'Connor, Ph.D., president of PROactive Strategies and former Illinois Commerce Commission Chair, said that due to the 10% choice cap, in 2012 Michigan consumers were paying an average of about 2 cents per kWh above the regional market price, or 20%, amounting to something on the order of $1.8 billion in extra costs.

"Between 2008 and 2011, with a sluggish economy and the large price declines in natural gas, rates have fallen 5% in the group of customer choice states while they have risen 7% in the traditional regulated monopoly group of states. This trend continued in 2012," O'Connor said.