Impact of Electricity Utility Rate Reform in Oakland and Livingston Counties, Michigan

James H. Johnson
Bradley T. Cullen
Lawrence M. Sommers

---

DOI: 10.2190/B7C1-6L52-TYKP-KCGR

Abstract

Disadvantaged households are more adversely affected by rising energy costs than the rest of the population. Lifeline rates have been proposed or enacted in a number of states, including Michigan, to ease the burden of electric price hikes on the poor. Inherent in the Michigan legislation is the proposition that electricity usage is positively associated with income and family status. This analysis of data from a sample of 1100 households in Oakland and Livingston Counties, Michigan, revealed that socio-economic and demographic variables are poor predictors of household electricity usage. Appliance mix and size of dwelling units appear to be better indicators of electricity usage. In fact, the Michigan legislation, as presently structured, will improve the economic well-being of many middle-class and affluent households, and further exacerbate the plight of a significant number of low-income households.

---

This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License.