October 28, 2005

MPSC Approves Gas Cost Recovery Settlement Agreements for Michigan Consolidated Gas Company and SEMCO Energy Gas Company

The Michigan Public Service Commission (MPSC) today approved two settlement agreements for Michigan Consolidated Gas Company and SEMCO Energy Gas Company dealing with gas cost recovery (GCR) plan reviews.

The utilities noted that the recent and unanticipated increases in market prices for natural gas have placed them at risk to experience significant under-recoveries.  Further, the companies note that any delays in recovering these large increases would economically burden their customers by requiring them to pay additional costs, plus interest, in the future. 

In Case No. U-14401, the MPSC approved a settlement agreement with Michigan Consolidated Gas Company that authorizes the utility to incorporate into its rates a uniform GCR factor of $11.3851 per thousand cubic feet for the billing months of November 2005 through March 2006. 

The settlement agreement was reached by the following parties:  Michigan Consolidated Gas Company, Attorney General Michael A. Cox, the Residential Ratepayer Consortium, and the MPSC staff.  The Michigan Community Action Agency Association filed a statement of non-objection.

In Case No. U-14402, the Commission approved a settlement agreement with SEMCO Energy Gas Company that authorizes the utility to charge a base GCR factor of $11.2684 per thousand cubic feet and suspend its contingency mechanism for the billing months of November 2005 through March 2006.

The settlement agreement was reached by the following parties:  SEMCO Energy Gas Company, Attorney General Michael A. Cox, the Residential Ratepayer Consortium, and the MPSC Staff.

The MPSC is an agency within the Department of Labor & Economic Growth.

Case Nos. U-14401 and U-14402