Commercial and industrial customers of Consumers Power Co. paid almost $500 million above their actual cost of service to subsidize residential customers over the past five years, claims John W. Clark, Consumers Power senior vice president. "The current subsidy of residential electric rates by Michigan industry is shortsighted and costs Michigan jobs," he told a business roundtable in Detroit. Clark asserts that industrial rates could be reduced to below the national average if they reflected only the actual cost of service.
Consumers Power filed a request last November with the Michigan Public Service Commission (PSC) that would, among other things, end rate subsidization in a two-step process beginning in 1995. Residential rates would rise about $1.75 per month in each of the next two years if the plan is approved. If subsidies were eliminated completely, some large industrial customers could see savings of up to $1 million annually, Clark maintains. (em LG
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