MichCon announced plans yesterday to give all of its 1.2 millionretail gas customers a choice of suppliers over the next threeyears. The Detroit-based distributor filed an application with theMichigan Public Service Commission for the program earlier thisweek. It is designed to begin next January with 225,000 customers.The plan also would reduce gas costs by 7% to $2.95/Mcf and freezethem for three years for those customers who continue to useMichCon as their gas provider.

In addition, the proposal provides an incentive for MichCon toreduce its purchased gas cost below the $2.95 level and share aportion of savings with customers if MichCon’s earnings exceed aprescribed return on its equity capital.

The proposed plan follows a two-year pilot program in GrandRapids where 50,000 customers were eligible to participate. Only 7%of those eligible chose to participate, however. Three alternativesuppliers participated in the first year and four are expected inthe second. The Grand Rapids program ends on March 31, 1999, theday before gas is scheduled to flow in the new program.

“Our customers told us they like having choices and believeincreased competition will add value to the products and servicesthey purchase,” said MichCon President Stephen E. Ewing. “They alsourged us to keep the program simple. Our proposed statewide plan isdesigned to do just that.”

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