The Michigan Public Service Commission (MPSC) Michigan Winter Energy Report forecasts increased electricity demand and reduced natural gas prices this winter.
Energy Demand on the Rise for Residential and Commercial Customers
The Michigan Public Service Commission (MPSC) released its Winter Energy Appraisal for 2024-2025, projecting a 2% rise in electricity demand across the state. Residential demand is anticipated to increase by 3.8%, with the commercial sector following at 2.6%. However, the industrial sector is expected to see a slight decline of 0.8%.
Natural gas usage, primarily driven by power generation, is forecast to rise by 3.8%, even as residential demand remains flat. This increase stems from Michigan’s reliance on natural gas for 77% of home heating and expanding use in electric generation facilities.
What to Expect for Heating and Electricity Prices This Winter
Despite higher demand, natural gas prices for residential customers are expected to drop. The projected average cost of $3.15 per thousand cubic feet (Mcf) marks a 10% decrease from last winter. Similarly, residential propane users, who represent 8% of Michigan households, will see prices stabilize at approximately $2.17 per gallon, a modest 3.8% increase.
Electricity prices will see a marginal uptick of 0.7% compared to last year. The east north-central U.S. region, including Michigan, is forecast to average 16.31 cents per kilowatt-hour (kWh) for residential electricity rates.
Energy Assistance Available for Michigan Residents
Families struggling with heating and electricity costs this winter can access a range of financial assistance programs. The MPSC’s one-stop webpage, michigan.gov/mpsc/gethelp, provides resources for income-qualified households. Programs such as State Emergency Relief, the Michigan Energy Assistance Program, and the Home Heating Credit are highlighted, along with utility-specific payment plans.
Residents can also seek support through Michigan 211 by dialing 211 or visiting mi211.org for confidential assistance with energy bills, food, housing, and other essential services.
Michigan’s Fuel Breakdown: Trends in Propane, Gasoline, and Diesel
Propane
Propane demand is expected to remain stable, with U.S. inventories slightly lower year-over-year. Wholesale prices began the season at 93 cents per gallon, up 6 cents from last year, while residential rates hover around $2.21 per gallon.
Gasoline
Motor gasoline sales are predicted to increase by 0.3%, rebounding from a 0.8% decline in 2023. Prices have seen a slight drop, averaging $3.09 per gallon in late November.
Diesel and Heating Oil
The cost of on-highway diesel fuel is projected to average $3.76 per gallon, a 46-cent decrease from 2023. Similarly, No. 2 heating oil prices have declined by 20%, with an average of $3.12 per gallon as of late November.
Reliable Energy Supply Anticipated Despite Growing Demand
Michigan residents can expect a stable energy supply this winter. Natural gas storage levels, while slightly lower year-over-year, remain robust at 528 billion cubic feet. Electricity generation is also projected to meet the increased demand without interruptions.
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