Michigan Rates
Your business depends on natural gas to be there when you need
it. At Michigan Gas Utilities, we're making improvements to ensure that
you have a reliable supply of energy for years to come. Of course, these improvements
come with a cost. It's likely that our customers will see increasing energy rates
for the next several years.
We can't avoid making the changes our customers depend upon.
What we can do is manage our costs responsibly — and provide you with
the information you need to take control of your energy costs. A good
way to start is by understanding the rates you see on your monthly
energy bill.
On this site, we'll try to explain your rates in straightforward terms.
Natural Gas Rates for Business Customers in Michigan
Most businesses served by Michigan Gas Utilities receive Commercial
and Industrial Firm Natural Gas Service. Commercial and Industrial Firm Natural
Gas Service is designed for:
- businesses, schools and government facilities
How Reliable Is the Service This Rate Provides?
Commercial and Industrial Firm Natural Gas Service provides uninterrupted service
for your business, except in emergencies. This means gas is available to you whenever
you need it. The only exception — as with any gas service — is when unexpected events
occur (such as a severe storm or a contractor digging into a gas line) that make it
impossible to deliver gas to your business. When this happens,
Michigan Gas Utilities responds immediately to restore service.
How Is the Gas I Use Measured?
The amount of gas flowing through your meter is measured in hundred cubic feet
(Ccf). Your bill shows how much gas (Ccf) your business used for the past month.
What Charges Are Involved?
Each month your bill for commercial and industrial gas service includes:
- Distribution Charge, covering the cost of delivering gas to your business on
the Michigan Gas Utilities system. This charge varies with the amount of gas
you use each month. Your bill shows the volume of gas used multiplied by this
cost. See the table below for current rates for Local Distribution Service.
- Gas Cost, covering the estimated cost of gas and all related costs for
ensuring a reliable gas supply for our customers. It also includes contract costs for
securing:
- adequate pipeline capacity to transport gas to this service area, and
- adequate storage space for gas until it's needed.
Michigan Gas Utilities annual estimated costs are spread out evenly
over 12 months and listed as the Gas Cost on your bill. This charge varies with
the amount of gas you use. You pay $0.70400 per Ccf for the gas you use. This is
what Michigan Gas Utilities pays for the gas — we do not mark up or profit
from the price of gas.
The Michigan Public Service Commission approves estimated Gas Costs. At the end
of the year, the commission compares actual gas costs with the revenue collected
from customers. The commission determines if too much or too little was collected
and considers this information as it sets Gas Costs that Michigan Gas Utilities
may charge for the next year.
- Customer Charge, a fixed charge that does not vary with the amount of
gas you use. The Customer Charge covers the cost of providing safe, reliable gas
service. It includes the cost of Michigan Gas Utilities owning,
maintaining and reading meters; maintaining equipment; and providing service programs
and communication services. The Customer Charge is the minimum amount you will be
billed each month. See the table below for current Customer Charge amounts.
- Energy Optimization (EO) Surcharges are required by Public Act 295, as detailed below:
- This charge permits, pursuant to Section 91(4) of 2008 PA 295, the adjustment of rates, to allow for recovery of the payments made by the Company in compliance with Section 91(1) of 2008 PA 295.
The Energy Optimization (EO) Surcharge for small general service is $3.82 per meter per month and the surcharge for large general service is $77.09 per meter per month.
Charges on Your Gas Bill
| Annual Natural Gas Usage (Customer Class) |
Type of Customer |
Customer Charge** |
Local Distribution Service Rate (Ccf) |
Gas Cost Charge (Mcf)* |
Commodity Charge (Mcf)* |
| Up to 273,000 Ccf |
Year-round (12-month) |
$33.82 |
$0.11500 |
$7.0400 |
$7.9500 |
| More than 273,000 Ccf |
Year-round (12-month) |
$452.09 |
$0.10000 |
$7.0400 |
$7.8000 |
*Charges occur monthly.
**Charges occur monthly. This includes the Energy Optimization (EO) Surcharges.
Several factors can influence your business's monthly gas use.
Major factors that can be measured
by Michigan Gas Utilities are summarized in the lower left-hand corner of
your monthly bill.