Energy Choice Now: Michigan Electric Rates Continue to Climb Under Choice Cap

Michigan electric rates continue to increase as the state lacks the price competition present under electric choice to discipline pricing.

Rates in all sectors are higher than they were one year ago, Energy Choice Now said.

"Over the last year, Michigan’s rates jumped 3.7 percent – far more than the rate of inflation, and more than double the regional average increase of just 1.5 percent. Meanwhile, rates in Illinois, a state that continued with competition when Michigan re-monopolized its electric system in 2008, dropped by 4.7 percent," Energy Choice Now said.

According to Energy Choice Now, Michigan’s overall electricity rates in May were 16 percent higher than the regional average. Industrial electric rates were 23 percent higher and commercial rates were 14.5 percent higher. Residential rates were 15.6 percent higher than their regional counterparts.

The latest numbers from the U.S. Energy Information Administration, which reflect data from May 2013, show that Michigan needs electric competition soon before it falls even further behind its neighboring states, said Wayne Kuipers, executive director of Energy Choice Now Michigan.

"Our business members tell us time and again that energy is one of their top three cost drivers – that electricity rates are paramount when companies are deciding whether to expand or contract, to create jobs or lay off workers," Kuipers said. "Because of Michigan’s electric monopoly, our businesses have to dig out of a hole from the very beginning. That’s not a business-friendly climate."