Michigan natural gas choice: four territories

The programme is approved utility by utility, not granted by the state

Michigan writes gas choice as a utility application rather than a statewide entitlement. Public Act 634 of 2002 added sections 9 and 9b to the 1939 public service act, and each definition narrows the field. An alternative gas supplier sells at unregulated retail rates where the gas is delivered by a utility that has a customer choice programme, and those sales expressly are not public utility service. A choice programme is one approved by the Commission on application by a gas utility. A natural gas utility is an investor-owned business whose rates the Commission regulates. Read together, the boundary is structural: a system that is not investor-owned and regulated has nothing to apply to, and a utility that never filed an application has none either.

• 2002 PA 634 inserted MCL 460.9 and 460.9b.
• Supplier sales inside a programme are not public utility service (MCL 460.9(1)(a)).
• A programme exists only where a utility applied and the Commission approved (MCL 460.9(1)(d)).
• Four territories: Consumers Energy, DTE Gas, Michigan Gas Utilities, SEMCO.

Here the customer is the end user, not the meter

The electric statute defines a Michigan customer by the billing meter, which is why a multi-site operator holds one queue position per metered address. The gas statute does something different, and the difference changes who signs. Section 9(1)(c) says a customer is an end user of natural gas, a party rather than a service point. On a campus, in a multi-tenant building, or under a property manager running accounts for other businesses, the end user has to be identified before an enrolment means anything, because the supplier contracts with that party while the utility keeps billing the account. The utility applies the same test from its side: every account on one transportation contract has to sit under the same ownership or management control, so a portfolio assembled from unrelated tenants cannot be carried on a single gas contract the way it can be pooled on the electric side.

• Gas: a customer is an end user of natural gas (MCL 460.9(1)(c)).
• Electricity: a customer is the facilities behind one billing meter (MCL 460.10a(9)(a)).
• One gas transportation contract may cover several meters, all commonly owned or managed.
• Settle who the end user is before negotiating; the supplier contracts with that party.

Two doors: sales service first, transportation above a volume

There are two routes to a supplier and they are not interchangeable. In the choice programme proper the supplier sells the commodity and the utility delivers it, with the supplier's charge collected on the utility bill; the Commission describes the gas as delivered by the local utility whichever supplier a customer picks. Above a volume the route becomes transportation: at Consumers Energy the supplier contracts with the customer for the gas, delivers it into the utility system, and invoices separately, while the utility transports it and bills distribution. Nomination duties start at that point. The utility states the practical threshold plainly, that a typical transportation customer has one or more meters on the contract and usually at least one meter with annual use of 8,000 Mcf or above. Below that line a business is still a choice customer, just not a transporting one.

• Sales service: supplier commodity billed through the utility, delivery unchanged.
• Transportation: supplier invoices separately and must put gas into the system.
• Consumers' threshold: usually at least one meter at 8,000 Mcf a year or more.
• The tariff decides which door applies; a supplier's pitch does not.

The default you leave is a pass-through with a docket number

Michigan's default supply is a recovery mechanism, not a utility margin. Consumers Energy's Gas Cost Recovery charge recovers purchased gas and associated transmission cost under Commission authorisation, and the company states it earns nothing on the charge; the factors are filed as maximum allowable amounts for a period, with the set covering April 2026 through March 2027 sitting in Case No. U-21887. DTE Gas reviews its factor monthly against expected supply cost and trues up the difference afterwards. Two consequences follow for a buyer. The number moves by filing, so a quote measured against it is measured against a moving benchmark, and the filing date is part of the comparison. And choosing a supplier removes the commodity charge, not the bill: the customer charge, distribution and metering stay with the utility, and on the transportation route the balancing terms stay with you.

• GCR recovers purchased gas and transmission under Commission authorisation, with no utility margin.
• Consumers files maximum allowable factors by period; April 2026 to March 2027 is Case No. U-21887.
• DTE recalculates monthly and reconciles to actual cost later.
• Leaving GCR does not remove the customer charge, distribution or metering.

The tariff quotes Mcf; the bill arrives in therms

Michigan's gas tariffs are written in Mcf while meters read and bills present in therms or Ccf, and the conversion is not a constant worth memorising. A therm is 100,000 Btu, so therms per thousand cubic feet depend on the heat content of the gas that actually moved; that is why DTE publishes a system-wide BTU factor as a settlement input and reported 1.05028 for September 2026. Build your own factor from your own bill rather than borrowing one: divide therms billed by Mcf delivered, or by Ccf and multiply by ten, and keep the ratio for the months you compare. Then expect the utility to apply its own conversions when it sizes the contract. Consumers computes maximum daily quantity from the highest month of 36 divided by 30 and multiplied by 1.02, and annual contract quantity from the highest twelve consecutive months multiplied by 1.10 for headroom.

• A therm is 100,000 Btu; a thousand cubic feet is a volume whose heat content varies.
• DTE publishes a system-wide BTU factor as a settlement input (1.05028 reported for September 2026).
• Your own factor: therms billed divided by Mcf delivered; for Ccf, divide and multiply by ten.
• MDQ = highest month in 36 / 30 x 1.02; ACQ = highest 12 consecutive months x 1.10.

The tolerance band is the real contract term

On the transportation route the number that decides operating risk is not the commodity price but the Authorized Tolerance Level. Consumers defines it as the share of annual contract quantity a customer may hold in gas at the end of a month without penalty, sets 8.5 percent as standard, lets a customer elect a different percentage according to how closely it wants to track consumption, permits one change every twelve months, and notes that the level feeds into the monthly delivery charge. Gas inside the band banks forward, which is a real advantage for a seasonal operation buying summer gas for January. Gas outside it is the group administrator's problem and is charged as such. The exit terms belong in the same conversation: the minimum transportation term is twelve months, and returning to utility supply requires twelve months' advance notice, because the utility's own purchasing programme excludes the gas its transportation customers buy.

• ATL defaults to 8.5% of ACQ, is electable, and changes once every 12 months.
• Gas held inside the band carries into later months; excess beyond it is charged.
• Minimum term 12 months; 12 months' notice to return to utility supply.
• No cap on the number of suppliers; a transfer form in by 12:30 pm ET on the next-to-last business day applies that month.

Storage, deliverability and the path into the state

Michigan's storage position is published field by field. The Commission's active field summary puts statewide working gas at 671 Bcf, where working gas is the maximum that can be cycled in and out and base gas only holds pressure. The reservoirs are depleted Niagaran and Michigan Stray formations converted from the 1940s onward: Belle River Mills at 46.9 Bcf of working gas, Six Lakes 40, Winterfield 25.3, Overisel 23, with DTE's fields alone carrying 124 Bcf. Consumers Energy states it owns fourteen fields capable of 151 Bcf, which it calls 45 percent of what its customers need for winter. Volume is not the constraint on the coldest morning, though: withdrawal rate is, because wells, compression and interconnections set it, and reservoirs decline with age, which is why the Commission approved work connecting new wells in the Ray and Puttygut fields. All of it arrives on six interstate systems the Commission names, ANR, Great Lakes, Northern Natural, Panhandle Eastern, Trunkline at White Pigeon and Vector, plus border connectors at Marysville and St. Clair. That Great Lakes leg is what ties pricing here to Dawn in Ontario, where an index still needs transportation, cross-border charges, fuel and reserved capacity before it reaches a burner tip.

• Statewide working gas 671 Bcf; DTE's fields 124 Bcf; Consumers owns 14 fields, 151 Bcf, 45% of its winter need.
• Working gas cycles; base gas holds pressure and is not withdrawn.
• Deliverability, not inventory, is what binds on a peak day; Ray and Puttygut wells are the current example.
• Six interstate systems plus two border connectors; Dawn is an input to the arithmetic, never the delivered cost.

What to assemble before a Michigan gas quote

Because the structure bifurcates, the first question is which door the account comes through and the second is what the tariff will assume about it. Establish the delivery utility and confirm it runs an approved programme, then decide from the utility's own volume test whether the site sits in sales service or transportation. Pull 36 months of monthly consumption per meter rather than twelve, because the contract quantities are computed from that window. Work out the site's summer-to-winter ratio from its own bills to see how much of the annual quantity will sit inside the tolerance band in July. Then read the notice terms as commitments: twelve months to return to utility supply, and the 45 to 60 days a new transportation agreement takes from request to set-up, starting on the first of a month.

• Utility and programme first; sales service versus transportation second.
• 36 months of monthly use per meter, because contract quantities are built from that window.
• Compute your own summer-to-winter ratio to see what can sit in the band.
• A new transportation agreement runs 45-60 days and starts on the first of a month.

Where HighGround fits, and what this page does not claim

The page explains how a Michigan gas account is structured; it does not quote one. A review needs the utility bill for each meter, the transportation agreement or rider showing contracted quantities, the current supply agreement with its expiry and notice clauses, and 36 months of monthly use. From those two decisions follow: whether the volume belongs in sales service or transportation, and which date binds first. Availability and terms depend on the utility territory, the meter and the end user, so no two accounts are quoted alike, and a system outside the four approved programmes has no commodity choice at all. HighGround may receive compensation from a provider when a purchase completes; sending an inquiry places no order and switches no supplier.

• Bring the bill, the transportation agreement, the supply contract and 36 months of use.
• The two decisions: which route, and which date binds first.
• No programme, no choice: four utilities are named, and a municipal system is not one by default.
• An inquiry places no order and switches no supplier.

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