Utility Actual-Cost Ratemaking Requirement (SB1031)

Current understanding

SB1031 would amend Sec. 6a of 1939 PA 3 (MCL 460.6a) to require the Michigan Public Service Commission to use actual costs — rather than projected, forecasted, or estimated costs — when setting utility rates. The bill is introduced; the precise scope (e.g., whether it applies to test years, capital investments, or fuel/purchased-power adjustments) depends on the statutory text. If enacted, it could shift rate-case practice away from forward-looking test years and reshape how utilities recover expenditures.

Evidence log

• 2026-05-12 — Public utilities: rates; requirements for rate increases; provide for. Amends sec. 6a of 1939 PA 3 (MCL 460.6a).: cross-connection with utility-rate-increase-requirements: Companion effort to constrain rate-case inputs; SB1031 pushes actual-cost ratemaking while HB5942 adds threshold requirements for rate increase petitions. (novelty: 2)
• 2026-06-10 — Public utilities: rates; use of actual cost for setting utility rates; require. Amends sec. 6a of 1939 PA 3 (MCL 460.6a).: cross-connection with rate-case-cost-recovery-prohibition-hb6094: Both bills constrain how the MPSC sets utility rates under 1939 PA 3 — SB1031 by mandating actual-cost inputs and HB6094 by barring recovery of certain cost categories. (novelty: 3)

Open questions

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