Consumers Energy 2025 Power Supply Cost Case: What the Commission Decided
On April 30, 2026, the Michigan Public Service Commission issued its final order in Consumers Energy’s 2025 electric power supply cost case (Case No. U‑21592). The case determines how certain fuel and power supply costs will be recovered from customers through a monthly charge on electric bills.
What was approved
The Commission approved Consumers Energy’s 2025 Power Supply Cost Recovery (PSCR) plan, including a base monthly charge that reflects forecasted fuel costs, power purchases, transmission expenses, renewable energy costs, and the final portion of costs related to extreme price volatility in 2022. These underlying cost projections were not disputed by the parties.
The contested issue: monthly adjustment authority
The central dispute in the case involved Consumers Energy’s request to continue using a contingency adjustment mechanism that allows the company to increase the power supply charge during the year if projected natural gas prices rise. The adjustment is tied to national natural gas price forecasts and can change monthly, up to a capped limit.
Consumers Energy and Commission staff argued this approach helps avoid large “catch‑up” charges later and reduces interest costs when fuel prices are volatile. Consumer and business advocates, including the Citizens Utility Board of Michigan (CUB), disagreed, warning that the mechanism could make electric bills more unpredictable, rely on price indicators that do not reflect actual utility costs, and place more short‑term risk on customers.
The Commission’s decision
The Commission approved the contingency mechanism, finding that it is permitted under state law and consistent with prior Commission approvals. The Commission emphasized past precedent and concluded that allowing in‑year adjustments can help reduce large under‑recoveries and better align charges with market conditions. While acknowledging concerns about volatility and affordability, the Commission determined those concerns did not outweigh the benefits cited by Consumers Energy and staff.
CUB’s role in the case
CUB participated in the case on behalf of residential customers. CUB challenged the contingency mechanism by highlighting its impacts on household budgeting, bill predictability, and risk‑shifting, and by questioning whether reliance on national gas price forecasts adequately reflects Consumers Energy’s actual costs. Although the Commission ultimately approved the mechanism, CUB’s advocacy influenced the decision by ensuring these consumer impacts were fully examined and addressed in the final order, clearly defining where customer advocates and the Commission continue to disagree.
Why this matters to customers
With the contingency mechanism in place, Customers may see month‑to‑month changes in the power supply portion of their electric bills rather than having all adjustments delayed to future years. Supporters say this reduces the risk of large deferred charges; critics caution that it can make bills harder to predict and increase short‑term financial pressure during periods of market volatility.