LANSING, Mich. (Michigan News Source) – Starting this fall, Michiganders will notice a little more weight on their electric bills — and no, it’s not just because of inflation. Beginning in September, the “low-income energy assistance funding factor” – a mouthful that really means you’re footing part of someone else’s utility tab – will jump from 87 cents to $1.25 per month.
Sure, it sounds small. But when you multiply it across millions of households and businesses, it adds up to more than $75 million a year, according to a report from MLive. It’s an involuntary act of charity green-lit by the Michigan Public Service Commission (MPSC).
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And if you thought this was a one-time favor, think again. The surcharge can keep climbing until it hits a max of $2 a month, plus inflation adjustments after that.
The rules: pay up and smile.
Thanks to a 2024 state law, not only will the surcharge go up, but a lot more people can now qualify for help – roughly 335,000 households instead of the previous 50,000. In other words, the pie didn’t just get bigger; it got sliced into a lot more pieces, and unsuspecting Michiganders (who don’t regularly check out the charges on their electric bills) are paying for the ingredients.
The law does at least ensure that the money collected from your region is used locally – at least to the “extent possible.” So, if you were thinking that your contribution might anonymously cover someone’s power bill on the other side of the state, it shouldn’t. Your generosity will stay close to home.
Increase approved by Michigan lawmakers and governors.
Officials say the surcharge funds the Michigan Energy Assistance Program, which helps low-income households catch up on heating and electricity bills, enroll in payment plans, and get financial counseling. This allowance to expand the pot of money available and the surcharge increase was voted on by state legislators and signed into law last December by Democratic Governor Gretchen Whitmer.
Coming soon: even more of your money with even less say.
For now, the surcharge will stick at $1.25 between September 2025 and August 2026. But then the law lets it climb by 25 cents a year, meaning your forced generosity could soon cost twice as much – all while utilities themselves are already asking for historic rate hikes and dodging payout obligations after storms.
At this rate (no pun intended), Michiganders aren’t just paying for their lights to stay on – they’re paying for someone else’s lights to stay on too, with a government-mandated tip jar attached.
