SB 1207 Summary

• Gas and electric utilities must receive Public Service Commission approval before increasing rates or charges, with utilities providing supporting evidence and affected parties given notice and opportunity for a full hearing.

• Commission must notify utilities within 30 days whether rate applications are complete; applications are deemed complete if not rejected within 30 days, and the commission has 180 days from complete application filing to issue a final order.

• If the commission does not issue a final order within 180 days of a complete application, the utility may implement up to the proposed annual rate increase through equal percentage increases to all base rates, but must refund customers with interest any amounts exceeding the final order, with interest rates of 5% plus LIBOR or the authorized rate of return on common stock.

• Commission must adopt standard rate application filing forms and instructions by January 4, 2009, and may not authorize automatic adjustment clauses that operate without notice and hearing opportunities.

• Upper Peninsula electric utilities leasing generation facilities from affiliated entities cannot pass through lease costs exceeding what ownership costs would be, unless the affiliated entity is more than one-third owned by nonprofit or governmental entities.