Gov. Snyder Signs Bill Cutting Electricity Rate for Qualifying Industrial Manufacturing Companies

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Michigan Gov. Rick Snyder Wednesday signed legislation allowing large industrial manufacturing companies that meet certain criteria to apply to receive a reduced electricity rate.

“The availability of this new long-term industrial load rate will allow companies with high energy costs to continue expanding in Michigan, providing opportunities for economic growth and more jobs for Michiganders,” says Snyder.

House Bill 5902, now Public Act 348 of 2018, was sponsored by state Rep. Dan Lauwers, R-Tawas City, and gives authority to the Public Service Commission to allow customized electricity rates for companies meeting certain criteria.

Current law requires electricity rates to be based on cost of service. The bill authorizes the commission to make an exception, provided certain requirements are met, including:

  • If there is a net benefit to the utility’s customers from the implementation of the industrial load rate;
  • The rate is based on the cost of a specific designated power supply resource;
  • The customer agrees to a long-term contract to pay the costs for that designated power supply resource for the life of the resource;
  • The customer’s electricity usage is uniquely low cost to serve (minimum load of 200 megawatts at a single site and an annual load factor of at least 75 percent); and
  • The customer can demonstrate that it has a self-service alternative to utility service.

More information on this and other legislation is available here.

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