MICHIGAN SMART METER CASE QUIETLY REOPENED
On September 25th, 2012 something happened that will change the whole course of smart meter events in Michigan. You didn’t hear about it because no press release was issued and the media, failing as usual to do its own due diligence, has remained silent on the most significant development to date on an issue on which 24 city governments and two county governments have pressed for resolution.
The Michigan Public Service Commission on this day issued an Order reopening general rate case U-15768, in order to comply with an Order of the Michigan Court of Appeals issued last April. The Court of Appeals had rebuked the MPSC in its April 10th decision for failing to do a proper cost/benefit study before authorizing, in January 2009, $37 million dollars in smart meter costs to be passed on to customers. The Court’s Order read in part
“Appellants have established that the PSC’s decision to approve the nearly $37 million rate increase to fund the program was unreasonable because it was not supported by “competent, material and substantial evidence on the whole record.”
. . . “Accordingly, we remand this matter for the PSC to conduct a full hearing on the AMI program, during which it shall consider, among other relevant matters, evidence related to the benefits, usefulness, and potential burdens of the AMI, specific information gleaned from pilot phases of the program regarding costs, operations, and customer response and impact, an assessment of similar programs initiated here or in other states, risks associated with AMI, and projected effects on rates. In other words, a real record, with solid evidence, should support whatever decision the PSC makes upon remand.”
The MPSC had stalled complying with this Order for many months, while Detroit Edison continued to force thousands more meter installations unwilling customers must pay for, but finally had exhausted all possible delays and is now doing what it must do to avoid being in contempt of court. The case that was reopened has been running since January 2009 and dealt with Detroit Edison’s entire rate structure and only in part with smart meters. Yet it was a decision in this case that effectively gave Detroit Edison a green light to start mass deployment of the new meters. So it is appropriate that the question wrongly decided earlier in this case now be revisited in that same case.
The MPSC will now be holding evidentiary proceedings where interested parties may intervene, witnesses may be called and cross examined, and the Commission will revisit its earlier decision in the light of real evidence. Michigan’s Attorney General has argued that “Detroit Edison has the burden to prove that investments in AMI are reasonable and prudent.”
While we cannot be sure that the Commission will reach a different conclusion now than it reached in 2010, there is a real possibility that could happen. If the Commission concluded that such investment in AMI is not “reasonable and prudent”, that would mean costs could not be charged back to customers and probably the end of the entire smart meter program in this state, or at least the end of the utility’s ability to fund smart meter deployment in new areas where installs have not yet taken place.
Of course the Commission will now begin a process that could easily take another 6 months or more so that, in the absence of any moratorium, DTE will be able to move still closer to final completion of this ill conceived project before any ultimate decision is reached.