Public utilities: rates; use of actual cost for setting utility rates; require. Amends sec. 6a of 1939 PA 3 (MCL 460.6a).
Key claim: SB1031 would amend Michigan’s public utility rate-setting statute to require that actual costs be used when establishing utility rates.
Abstract
(SB1031 · 103rd Legislature) Public utilities: rates; use of actual cost for setting utility rates; require. Amends sec. 6a of 1939 PA 3 (MCL 460.6a). Latest action (2026-06-10): Referred To Committee On Energy And Environment
Why this matters
Michigan utility rates are currently set using forward-looking test years and projected costs, a practice that shapes how much ratepayers pay for future capital plans and forecasted expenses. Requiring actual costs would fundamentally change MPSC ratemaking mechanics and could reduce the risk that ratepayers fund expenditures that never materialize, while also altering utility cash-flow and financing dynamics.