In re Indiana Michigan Power Co.
824 N.W.2d 246
Mich. Ct. App.2012Background
- In Docket 299590, PSC allowed Indiana Michigan to self-implement interim rates with varying percentages, not equal-percentage increases as § 6a(l) would suggest.
- In Docket 299591, PSC similarly allowed Consumers Energy to self-implement interim rate increases with varying percentages.
- Attorney General appeals, arguing the law requires equal-percentage increases for all base rates during interim self-implementation.
- § 6a(l) permits self-implementation after 180 days if no final order, but initially contemplates equal-percentage changes unless good cause; it does not expressly authorize varying-percentage schemes.
- § 11(1) requires phasing in cost-based rates over five years, using a 50-25-25 allocation framework, with potential modifications to ensure cost-of-service alignment.
- PSC interpreted § 11(1) to permit a cost-based, phased self-implementation during the interim period, enabling varying percentages to avoid frustrating the five-year phase-in.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether PSC had authority to permit varying-percentage interim increases during the five-year phase-in. | AG: must use equal-percentage increases per § 6a(l). | PSC may phase in cost-based rates under § 11(1) and adjust interim rates during the period to avoid undermining the phase-in. | Yes; PSC authorized to vary percentages during the phase-in. |
| Whether § 6a(l) and § 11(1) conflict, requiring pari materia interpretation. | Statutes conflict; equal-percentage requirement governs interim changes. | Statutes should be read together; the phase-in authority permits non-uniform interim rates. | No reversible conflict; reading § 6a(l) with § 11(1) allows phase-in flexibility. |
| Is the appeal moot after settlements and final orders? | Settlement renders the issue moot. | Due to public significance and likely recurrence, issue remains reviewable. | Not moot; issue publicly significant and likely to recur. |
Key Cases Cited
- In re Application of Consumers Energy Co for Rate Increase, 291 Mich App 106 (2010) (standard of review for PSC orders; cost-based rate considerations)
- Robinson v City of Lansing, 486 Mich 1 (2010) (parens materia and legislative intent; ambiguity analysis)
- Mich Basic Prop Ins Ass’n v Office of Fin & Ins Regulation, 288 Mich App 552 (2010) (statutory interpretation; ambiguity when multiple meanings)
- In re Complaint of Rovas Against SBC Mich, 482 Mich 90 (2008) (agency interpretation given respectful consideration but not binding)
- Moran v People, 25 Mich 356 (1872) (courts cannot legislate by construction; respect legislature's intent)