The Michigan Public Service Commission (MPSC) is projecting higher natural gas consumption this year than a year ago, leading to lower than normal residential gas bills.
According to the Michigan Energy Appraisal Summer Outlook for 2019, gas demand is projected to rise 1.4% this year, mainly because of increased gas use for electricity production following the polar vortex early this year. Higher temperatures this summer could also increase demand for electricity to run air conditioning.
If prices remain at current levels, this year's average residential bills are projected to be $20 lower than last year.
The average monthly residential summer bill for customers of the state’s four largest gas utilities -- DTE Gas, Semco Energy, Consumers Energy, and Michigan Gas Utilities -- is expected to be about $34 for April through October. A typical residential customer's annual gas bill for April 2019 through March 2020 is forecasted to be $754, down from $773 last year.
Production from gas wells in the state continues to decline and is expected to decrease by 5.9% to 84.9 Bcf in 2019.
Electricity sales are also expected to decrease by 0.9% to 102,900 GWh, according to the MPSC analysis, down from 103,000 GWh hours from 2018. Residential sales are expected to drop 2.2% and commercial 0.6%. However, industrial sales are expected to rise by 0.3%.
This year's combined peak electrical demand and planning reserve margin requirements are about 4% higher than was projected for 2018. Last year, electrical demand peaked for Consumers Energy at 7,568 MW on July 5, and for DTE Energy at 11,418 MW on Sept. 5.
The generation capacity required to serve the Lower Peninsula increased by 10.6 MW in 2019/20, compared with 2018/19. This summer's peak demand plus reserve margin for the Lower Peninsula is expected to be 21,976 MW, up from 21,121 MW last summer.
Generation capacity to serve the Upper Peninsula and eastern Wisconsin, however, rose by 195 MW.