eLab Accelerator 2020

Michigan Utility Business Model Reform

Project Description

This team wanted to investigate the regulatory reforms needed for Michigan’s electricity system to reliably serve customers given (1) aging grid infrastructure and (2) an increasing generation share of clean energy. Participants included climate and consumer advocates, senior leadership from the state’s two largest utilities, and representatives from the commission. They wanted to explore the potential for performance-based regulation and other new regulatory mechanisms to help Michigan meet its reliability objectives.

What The Team Achieved By Participating in Accelerator

At Accelerator, the team dedicated time to discuss and understand customer equity in the context of reliability, emphasizing the impact aging grid infrastructure has on poor neighborhoods. They looked at practical ways in which investment decisions are made with equity as a factor and how regulatory reforms could ensure that future utility investments are equitable for all customers.

The team developed desirable, innovative prototype concepts involving new technologies or rate programs, and used these prototypes as test scenarios to clarify where specific gaps and limitations exist in the current legislative framework. They ended Accelerator with a deepened understanding of the regulatory innovations that can best help achieve Michigan’s goals and identified ways to implement them.

Recently, in September, Michigan’s governor executed an order setting the goal of economic decarbonization by 2050. Serendipitously for future regulatory proceedings, the team’s participants have insights from working together at Accelerator that will help in creating robust initiatives that respond to this order and enable utility business models to transform in alignment with the order’s objectives.

Team Members

- Ryan Katofsky, Advanced Energy Economy, Managing Director

- Douglas Jester, 5LakesEnergy, Partner

- Brandon Hofmeister, Consumers Energy, Senior VP of Governmental, Regulatory and Public Affairs

- Mike Delaney, Consumers Energy, Executive Director for Policy, Cost and Pricing

- Trevor Lauer, DTE Electric, President and COO

- Camilo Serna, DTE Electric, VP of Regulatory Affairs

- Laura Sherman, Michigan Energy Innovation Business Council, President

- Mike Byrne, MI PSC

- Patricia Poli, MI PSC