Consumers Energy rate hike approved, bills set to rise in May

Michigan regulators have approved another increase in electricity rates, continuing a trend of rising energy costs across the state.

The Michigan Public Service Commission approved a rate hike for Consumers Energy that will allow the utility to collect an additional $276.6 million in revenue from its electricity customers.

The increase translates to an 8.9% rise in residential electric rates and will take effect May 1, 2026.

The decision comes after Consumers Energy initially sought a significantly larger increase, requesting $436 million in additional revenue and a 13% rate hike, along with a $24.3 million surcharge.

Regulators ultimately approved a figure about $160 million lower than the original request, following pushback from state officials, including Michigan Attorney General Dana Nessel.

In testimony filed with the commission, Nessel argued the increase should be reduced to 3.5%, calling for nearly a 65% cut to the company’s proposal.

“Consumers Energy customers will once again have to brace for higher bills because of the never-ending cycle of rate hikes passed on by the utility,” Nessel said. “Even though my office carefully reviews DTE and Consumers Energy rate hike requests for bloated and unjustified costs, it is ultimately the MPSC who determines how much to approve or how often these rate hikes occur.”

She added that the process continues to place the burden on ratepayers and urged lawmakers to reconsider what she called a “badly broken system.”

Despite the reduction, the newly-approved increase follows a $154 million electric rate hike granted just last year. Since 2020, regulators have approved nearly $800 million in annual revenue increases for Consumers Energy alone.

Under current law, the utility could file its next rate hike request as soon as June.

Alongside the rate increase, the commission also approved $226 million in investments for Consumers aimed at improving grid reliability.

The funding will support its programs focused on reducing outages and strengthening infrastructure, including tree trimming, burying power lines, installing stronger poles and deploying technology to respond more quickly to interruptions.

Consumers Energy said the upgrades are part of its 2026 Reliability Action Plan, which is designed to improve service for nearly two million electric customers across the state.

“Consumers Energy is helping our customers by securing the grid and giving them the tools to reduce and manage their bills,” said Greg Salisbury, the company’s senior vice president of electric distribution. “Our Reliability Action Plan represents an investment that will lead to fewer and shorter power outages.”

The company also pointed to recent improvements, saying the average customer experienced about an hour less outage time since 2021, a roughly 28% reduction.

At the same time, company officials acknowledged the strain of rising costs.

“We know the cost of everything is going up, from energy to health care to groceries,” said Kelly Hall, Consumers Energy’s senior vice president of regulatory and legal affairs. “That’s why we ensure that we’re making smart, cost-effective upgrades to secure the grid, fix problems before they happen, and improve reliability for our customers.”

The latest increase comes amid continued scrutiny of Michigan’s energy policies and regulatory system.

State Rep. Timmy Beson, R-Bay City, recently pressed regulators during a legislative hearing, raising concerns about the impact of repeated rate increases on residents and small businesses.

“I am hearing directly from my friends and neighbors that these constant rate increases are making it harder to make ends meet,” Beson said. “Small business owners in my district have seen their monthly utility bills increase by hundreds of dollars, while the business they’re doing stays the same.”

Advocacy groups have also raised alarms.

A coalition operating under the name “Our Bills Are Too Damn High” has accused utilities of prioritizing profits over infrastructure improvements, while pushing for Michigan’s first Ratepayer Bill of Rights. That initiative has seen little to no progress since it was introduced last year.

Meanwhile, critics of Gov. Gretchen Whitmer argue recent policy changes are contributing to higher costs. The nonprofit Michigan Forward Network said the latest increase is part of a broader trend under the current administration.

“Once again, Gretchen Whitmer’s handpicked appointees showed they have no regard for everyday Michiganders,” said Gabe Butzke, a spokesperson for the group.

The rate hike is one of several pending or recent cases before the commission. Consumers Energy has already filed for a separate $240 million natural gas rate increase, while DTE Energy and other utilities also have active or forthcoming requests for increases.

Consumers Energy provides electricity to about 1.9 million customers and natural gas to 1.8 million customers statewide, serving roughly 6.8 million residents in Michigan’s Lower Peninsula. Together, Consumers and DTE are the two largest energy providers in the state.