Printer Friendly

CMS ENERGY SAYS KELLEY MISLED BY MICHIGAN MUNICIPAL COOPERATIVE GROUP

CMS ENERGY SAYS KELLEY MISLED BY MICHIGAN MUNICIPAL COOPERATIVE GROUP
 DEARBORN, Mich., Dec. 20 /PRNewswire/ -- The following was released today by CMS Energy:
 CMS Energy's Chairman and Chief Executive Officer William T. McCormick Jr. has called on Attorney General Frank Kelley to drop his support of the Michigan Municipal Cooperative Group's (MMCG) misguided campaign against Consumers Power Company and CMS Energy, its parent company.
 McCormick, in a letter to the attorney general, labeled the major allegations in a filing Thursday at the Securities and Exchange Commission (SEC) against Consumers Power and CMS Energy as "blatantly untrue and totally misleading."
 McCormick noted that Consumers Power rates are among the lowest in the Midwest, well below the national average, 25 percent below Michigan's other major utility and below the average of the complaining MMCG member utilities.
 He also stated that charges of self-dealing arising from purchases by Consumers Power from its 49-percent owned affiliate are without merit, since the rates were approved by Michigan regulators and confirmed by the Michigan Court of Appeals and, in any event, have had no adverse impact on the utility's rates which have remained level for six years.
 With respect to Consumers Power's policy of transmitting power for other utilities, McCormick stated that Consumers Power has for years performed this service upon request at federally approved rates and has recently expanded its service to include purchases and resale for other utilities and independent power producers.
 McCormick indicated that the reasons for the MMCG's campaign against Consumers Power were totally motivated by self-interest because MMCG is attempting to get Consumers Power to provide its member utilities transportation service at rates below cost of service levels at the expense of Consumers Power's 3 million electric customers.
 In conclusion, McCormick suggested "that spending the Michigan taxpayers' money to attack the state's largest, most efficient and lowest-cost utility is unwarranted and does not serve the best interests of Michigan." He also said that the company will respond vigorously at the SEC.
 CMS Energy Corporation (NYSE: CMS) is a $3 billion (sales) diversified energy company with businesses engaged in the distribution of electricity and natural gas, interstate storage and transmission of natural gas, oil and gas exploration and production, independent power generation and utility services. CMS Energy Corporation's principal subsidiary is Consumers Power Company, Michigan's largest utility and the nation's fourth-largest combination electric and gas utility.
 The following is the text of McCormick's letter to the attorney general:
 December 20, 1991
 The Honorable Frank J. Kelley
 Attorney General
 State of Michigan
 525 W. Ottawa
 Law Building, 7th Floor
 Lansing, MI 48913
 Dear Attorney General Kelley:
 Recently your office has joined the Michigan Municipal Cooperative Group (MMCG) in a broad regulatory and public relations campaign to discredit Consumers Power Company and its holding company, CMS Energy. I believe your office has been misled by the MMCG's numerous false allegations in their attempt to force Consumers Power to transport power at less than cost-of-service rates which would, in effect, raise the rates to the 3 million people served by Consumers Power's electric system.
 In order that you and others may understand the facts, I wanted to personally answer the major allegations contained in a press release on the filing which your office and the MMCG made yesterday at the SEC charging CMS Energy/Consumers Power with Holding Company Act violations.
 1. Claim: That Consumers Power's rates are abusively high.
 This charge is absurd. Consumers Power's rates are among the lowest in the Midwest and well below the National average. In Michigan, they are 25 percent below the other major electric utility and below the average of the MMCG group of utilities, who are the ones complaining.
 2. Claim: That Consumers Power entered into an abusive contract with its 49-percent owned affiliate that results in billions of dollars of additional cost to Michigan's customers.
 This also is totally false. The power is purchased at an avoided- cost rate approved by the Michigan Public Service Commission and confirmed by the Michigan Court of Appeals. Furthermore, the rate for this power has had no adverse impact on Consumers Power's rates to its customers which have not risen in over six years. In fact, Consumers Power's rates have fallen in real terms since about 23 percent inflation has occurred since 1985. Also, it is odd that the MMCG is so concerned about the rates since their companies do not purchase any of the affiliate-purchased power.
 3. Claim: That CMS Energy used Consumers Power as a "cash cow."
 The fact is that, in the past six years, less than $75 million of Consumers Power's almost $18 billion of revenues have been dividended to its parent CMS Energy -- less than half of 1 percent. Furthermore, the amounts dividended to CMS Energy were from stockholder earnings and were entirely proper and legal.
 4. Claim: That Consumers Power Company refuses to transport power across its grid for the MMCG companies.
 This is totally untrue. Consumers Power has been open to all its municipal electric neighbors and has transported power on request at Federal Energy Regulatory Commission (FERC) established rates. Moreover, recently Consumers Power has filed an additional proposal with the FERC to permit municipal utilities, independent power producers and others to sell their power to Consumers Power for resale to customers connected to Consumers Power's electric system. In fact, Consumers Power's electric system is among the most accessible and open in the Nation. Again, the reason the MMCG is harassing Consumers Power is that they want Consumers Power to provide transmission service at less than cost-of-service rates -- thus, lowering the cost of power to their customers at the expense of Consumers Power's customers.
 Finally, I would ask that your office reconsider its decision to join the MMCG's misguided campaign against Consumers Power and drop your support since it is based on blatantly untrue and totally misleading information.
 I would further suggest that spending Michigan's taxpayers' money to attack the State's largest, most efficient and lowest-cost utility is unwarranted and does not serve the best interests of the State.
 Sincerely
 /s/
 William T. McCormick, Jr.
 WTM/lrt
 -0- 12/20/91
 /CONTACT: Michael J. Brogan of CMS Energy, 313-436-9253/
 (CMS) CO: CMS Energy Corporation; Consumers Power Company;
 Michigan Municipal Cooperative Group ST: Michigan IN: UTI SU:


JG -- DE022 -- 4455 12/20/91 15:14 EST
COPYRIGHT 1991 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Dec 20, 1991
Words:1052
Previous Article:KEYPORT LIFE INSURANCE CLAIMS PAYING ABILITY RATING 'AA-'
Next Article:SPELLING ENTERTAINMENT INC. ANNOUNCES RETIREMENT OF ITS PRESIDENT AND CHIEF OPERATING OFFICER
Topics:


Related Articles
CONSUMERS POWER COMPANY FILES INNOVATIVE ELECTRIC TRANSMISSION SERVICE PROPOSAL WITH FERC
UTILITIES OPPOSE CONSUMERS POWER TRANSMISSION SCHEDULE
CONSUMERS POWER PROPOSES OPEN ACCESS ELECTRIC TRANSMISSION SERVICE TO FERC
FERC APPROVES CONSUMERS POWER OPEN ACCESS INTERCONNECTION SCHEDULE
ANTITRUST REVIEW REQUESTED OF CONSUMERS POWER
UTILITIES CONGRATULATE MICHIGAN ATTORNEY GENERAL FRANK KELLEY
CONSUMERS POWER TRYING TO TAKE OVER COMPETITORS, SAYS MICHIGAN MUNICIPAL COOPERATIVE GROUP
GRAND HAVEN ACTS TO PREVENT CONSUMERS POWER FROM TAKING CUSTOMER
U.S. SUPREME COURT REJECTS APPEALS OF MIDLAND COGENERATION VENTURE CERTIFICATION
Consumers Energy Gas Costs Drop 40 Percent Since 1983

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters