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Most Michiganders should see lower utility bills starting this summer

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Michiganders could see lower utility bills sometime after July 1. Under state regulations, utility companies have to pass on savings from the new federal tax law to customers.

Michigan utility companies are saving money because of the new federal tax law. Under state regulations, they have to pass those savings on to customers. At its latest meeting, the Michigan Public Service Commission set a timeline for when those savings will appear.

Commissioner Rachael Eubanks spoke with Michigan Radio’s “Morning Edition” host Doug Tribou. 

Earlier this year, the commission ordered the 13 utility companies that it regulates to submit reports on how much money they're saving under the new law and their proposals for returning the savings to customers. The commission reviewed the reports and held a public comment period. 

In January, DTE Energy and Consumers Energy said they expected to reduce rates by 3 percent. Eubanks says that number may change because the commission still needs to approve it.

At its meeting on Feb. 22, the commission set three new deadlines that should result in rate reductions or credits.

Here's a look at the credits and the timelines for them: 

"Credit A" / July - August:  This is will be a long-term rate reduction based on the companies' ongoing tax savings. The commission will issue its final ruling by June 30. The rate cut should show up on monthly bills sometime in the third quarter depending on customers' billing cycles and some other factors.

"Credit B" / This fall: This will be a one-time credit to cover what utility companies saved between the start of the tax cuts in January and the start of Credit A. The commission will rule on this by August 30.

Other savings / To be determined: Utility companies are also expected to save money on deferred taxes and other items covered by the tax law. The commission set a deadline of Oct. 1 for utility companies to submit reports on those additional savings and how to reimburse ratepayers.

Editor's note: Consumers Energy is a corporate sponsor of Michigan Radio.

Doug Tribou joined the Michigan Public staff as the host of Morning Edition in 2016. Doug first moved to Michigan in 2015 when he was awarded a Knight-Wallace journalism fellowship at the University of Michigan in Ann Arbor.
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