Michigan Democratic lawmakers: Pay utility customers by the hour for outages

Beth LeBlanc
The Detroit News

Lansing — Michigan House Democrats are pushing a package of bills to crack down on utility companies responsible for days-long power outages in southeast Michigan and statewide. 

The five-bill package would require energy companies to provide hourly bill credits during outages, prevent those credits from being included in rate increases, require companies to list outage instances on bills, and require distribution and grid investment plans be open to more public comment.

In addition, Democratic Reps. Yousef Rabhi of Ann Arbor and Abraham Aiyash of Hamtramck said they’re working on a plan that would prevent regulated utilities or their nonprofits from contributing to lawmakers. 

"We can't keep continuing to allow this without any accountability," Rabhi said at a Wednesday Lansing press conference. 

The package faces an uncertain future in the Republican-controlled Legislature, where a GOP-led committee held hearings on last summer's power outages. 

Rabhi and Aiyash's Metro Detroit districts experienced several power outages last year, including a two-hour outage on the coldest day of December and a more than seven-day outage in August. 

The outages resulted not only in ruined groceries, but also damage to refrigerated medications and the relocation of individuals needing to escape the heat or cold, the lawmakers said. Utility companies provided some credits because of outages but it fell short of the cost and inconvenience experienced by constituents, Aiyash said. 

"Last summer...we got more calls about power outages as a result of the record rainfall than we did about unemployment cases," Aiyash said. "Every single complaint was about, 'Our power is out and we don't know when its going to turn back on,' and 'We don't have an update from DTE,' and 'We have food that is spoiling, we have insulin that is expiring.'"

State Rep. Joe Bellino, the Monroe Republican who chairs the House Energy Committee, said Wednesday he'd not yet seen the legislation and could not yet say whether the bills would receive hearings.

"We’ve had some hearings on the outages," he said. "I know there’s some serious problems in the Metro Detroit area.”

Both Consumers Energy and DTE Energy said Wednesday the legislation is "unnecessary." Detroit-based DTE argued the steps the Michigan Public Service Commission has taken to address outages are enough. 

The company is "accelerating" investments in its grid and people benefiting from the work are seeing 50-70% improvements in reliability, said Peter Ternes, a spokesman for DTE. 

"Last year, we filed a Distribution Grid Plan for the next five years with the MPSC," Ternes said. "The plan includes modernizing infrastructure to make the grid more resilient to the increasingly severe weather in Michigan, helping to drastically reduce the cost of outages for our customers as well as reducing budgeted funds and time spent on outages caused by equipment failures and weather."

Consumers Energy emphasized that it is already working "hard to ensure reliability" in its grid and filing investment plans with the Public Service Commission.

“Our plan calls for $5.4 billion over the next five years to reduce power outages with investments such as trimming trees, replacing poles and upgrading equipment to a higher, more resilient standard," Consumers Energy spokeswoman Katie Carey. "We also worked with stakeholders in a workgroup related to Service Quality and Reliability Standards that researched and made recommendations about the outage credit model."

Rabhi and Aiyash noted the utilities — which spent $55 million in "political" and "civic" spending on lawmakers in recent years — are likely to oppose the legislation and lobby legislative leaders to oppose the measures. 

"We can't basically regulate the utilities because they're the ones regulating us as lawmakers," Rabhi said in calling for a ban on contributions from utilities to lawmakers. 

"The utility influence in Lansing is no secret. They have a lot of money. They have an army of lobbyists in the Legislature. They have an army of lawyers at the Michigan Public Service Commission, the state regulators," said Nick Dodge, communications director for the Michigan League of Conservation Voters.  "But what they don't have is happy customers."

The legislation requiring outage credits would start at $5 an hour for the first hour and increase up to $25 an hour after 72 hours. Additionally, customers would receive a $100 credit for more than four outages in four months, $200 for more than six interruptions in six months and $300 for eight outages in a year. 

"They're going to be scrambling if they have 1,000 customers that they're having to pay $25 an hour to," Rabhi said. 

Under the legislation, utilities would be banned from including credit disbursements as a reason for a requested rate increase. 

The legislation also would require utilities to list on utility bills the number and duration of interruptions to a customer's service, and requires the Michigan Public Service Commission to review an electric utility's investment and maintenance distribution plans as a contested case to allow for additional public participation and input.