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Electricity competition may be on way out in Michigan

Tracy Samilton
Michigan Radio

Michigan's experiment with partially deregulating its electricity market could be over.

Bills to rescind the law which allows 10% of DTE Energy and Consumers Energy customers to leave for an alternate (i.e., cheaper) supplier are moving through the State House.

They're sponsored by the Chairman of the Energy Policy Committee, Republican Aric Nesbitt of the 66th District.

"Over the last 30 years, we've seen a lot of success deregulating industries that have full competitive elements, such as airlines, telecommunications, and trucking," says Nesbitt.  "But in terms of electricity, you have to have, for reliability purposes, more electricity on hand than what's needed -- more capacity to produce it.  Electricity has to be there when you need it, period."

Nesbitt says the state's two largest regulated utilities, DTE Energy and Consumers Energy, cannot plan for building new capacity if they don't know how many customers they will be serving in the future.

Both DTE Energy and Consumers Energy says they will refuse to build that new capacity unless all customers bear the costs of building it - not just the 90% of customers who cannot leave for an alternate supplier.

Nesbitt's bills would repeal the law allowing electricity competition, as well as require regulated utilities to use the lowest-cost electricity generation available, to keep electric bills down.

The bills would not repeal the state's mandate that 10% of electricity come from renewable sources, such as wind.

Tracy Samilton covers energy and transportation, including the auto industry and the business response to climate change for Michigan Public. She began her career at Michigan Public as an intern, where she was promptly “bitten by the radio bug,” and never recovered.