Last week, Michigan Attorney General Dana Nessel successfully defended utility bill savings for Indiana Michigan Power Company (I&M) customers at the Michigan Supreme Court. The appeal followed a March 2021 application that I&M filed with the Michigan Public Service Commission (MPSC) seeking to recover millions of dollars that it incurred to purchase or produce electric power for its customers in Michigan. Part of these costs included money I&M paid an affiliate power generator. The Attorney General intervened and argued that I&M paid more than comparable market price for the power from its own affiliate, a “sweetheart deal” with itself, and that this violated the MPSC’s rules for utility transactions with affiliate companies.
In February of 2023, the MPSC agreed with the attorney general and disallowed $1.347 million, thus saving customers from unreasonable costs and forcing I&M’s shareholders to bear the costs of this “sweetheart deal.” I&M appealed the MPSC’s order to the Michigan Court of Appeals. In January of this year, the Court of Appeals agreed with the Attorney General and affirmed the MPSC’s decision. I&M filed an application for leave to appeal to the Michigan Supreme Court seeking to overturn the Court of Appeals decision in order to continue profiting from its
unreasonable deal with itself. Last week, the Michigan Supreme Court denied I&M’s request thus reaffirming the savings for I&M customers.
This lengthy exchange in the courts is likely to benefit the attorney general’s efforts in defending another $11.2 million in savings for I&M customers. In that application, Nessel in May successfully convinced the MPSC to disallow a similar “sweetheart deal” whereby the company attempted to profit at the expense of its customers by passing along inflated business-to-business purchase prices of power from an affiliate company. I&M filed a rehearing petition with the MPSC on this additional $11.2 million. The Attorney General filed in opposition to this rehearing petition and the parties are currently awaiting a ruling.
“I’m gratified the Michigan Supreme Court rejected I&M’s request for further review of the Court of Appeals decision,” Nessel said. “The Commission got it right both times, acting in agreement with my department’s concerns and shielding customers from I&M’s self-serving profit scheme.”
I&M sells electricity to approximately 133,000 customers in southwestern Michigan.
In February of 2023, the MPSC agreed with the attorney general and disallowed $1.347 million, thus saving customers from unreasonable costs and forcing I&M’s shareholders to bear the costs of this “sweetheart deal.” I&M appealed the MPSC’s order to the Michigan Court of Appeals. In January of this year, the Court of Appeals agreed with the Attorney General and affirmed the MPSC’s decision. I&M filed an application for leave to appeal to the Michigan Supreme Court seeking to overturn the Court of Appeals decision in order to continue profiting from its
unreasonable deal with itself. Last week, the Michigan Supreme Court denied I&M’s request thus reaffirming the savings for I&M customers.
This lengthy exchange in the courts is likely to benefit the attorney general’s efforts in defending another $11.2 million in savings for I&M customers. In that application, Nessel in May successfully convinced the MPSC to disallow a similar “sweetheart deal” whereby the company attempted to profit at the expense of its customers by passing along inflated business-to-business purchase prices of power from an affiliate company. I&M filed a rehearing petition with the MPSC on this additional $11.2 million. The Attorney General filed in opposition to this rehearing petition and the parties are currently awaiting a ruling.
“I’m gratified the Michigan Supreme Court rejected I&M’s request for further review of the Court of Appeals decision,” Nessel said. “The Commission got it right both times, acting in agreement with my department’s concerns and shielding customers from I&M’s self-serving profit scheme.”
I&M sells electricity to approximately 133,000 customers in southwestern Michigan.
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