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Energy-Intensive Industrial Rates Workgroup Update
May 22, 2014
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Process:
Establish a workgroup consisting of a manageable number of stakeholders selected through an open, transparent process that develops, analyzes, and reports various options.
Objective:
Develop non-legislative options that can reduce electric rates for energy intensive companies, abiding by existing policies and cost-of-service principals.
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Deliverable – A Report to Inform Policy Makers:
A final report of options that will be used to inform the Governor, legislative staff, MPSC, and stakeholders. This report will detail how various options will impact all ratepayers and their potential implementation methods and timelines.
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Timeframe
March 24th – Announce workgroup process, solicit businesses to serve on workgroup
March 31st – Deadline for business customer nominations
April 2nd – Workgroup members announced
April 7th – First workgroup meeting, introduce participants, develop assignments
April 21, May 5, May 19th – Additional workgroup meetings
May 30th – Draft options finalized by workgroup
June 9th – Draft report available online for stakeholder/public comment
June 20th – Comment period closed
June 27th – Final report issued
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MEDC & MPSCSteve Bakkal – MEDCSteve McLean - MPSCDan Blair – MPSC Business CustomersMike Binion - Gerdau Special Steel North AmericaDavid Stoner - United States Steel CorpGeorge Andraos - Ford Motor CompanySteve Brooks - Verso Paper CorpKeith Tyson Kenebrew - Dow Chemical CompanyGerrit Reepmeyer - Severstal North AmericaJennifer Steiner - Burner - Marathon Petroleum Daniel Voss - General Motors CompanyRichard Nelson - Praxair, Inc.Rod Williamson - Dow Corning Corporation
Utility RepresentativesDon Stanczak – DTEStephen Stubleski – CMSJim Ault - MEGAKim Molitor - Wolverine Power
Legislative StaffGreg Moore – SenateDan Dundas - House
Workgroup Members
Annual Electric Load Profile by Class
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
5,500,000
6,000,000
6,500,000
7,000,000
7,500,000
ResidentialSecondaryPrimary
kW
1/62/9
4/8
3/4
5/26 6/22
7/7 8/31 9/1
10/20
11/30
12/9
12CP is the average of the 12 monthly coincident peaks (dates noted above)4CP is the average of the 4 summer monthly coincident peaks (6/22, 7/7, 8/31 and 9/1)
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Implementation Options
Two Options• Utility company files rate case recommending new
cost allocation or rate design method generated from workgroup
• MPSC initiates review of cost allocation and rate design methods (HB 5476). New rate established no later than Dec 1, 2015. Workgroup report used to inform MPSC.
