How to Identify Cheaper Electricity Suppliers in Michigan (Even If You’re Stuck With a Utility)

Want to lower your electric bill in Michigan but feel stuck with no real choices? You’re not alone—and this guide is here to help.

Why Electricity in Michigan Feels So Expensive (Because It Is)

If you’re a homeowner in Michigan, chances are you’ve glanced at your energy bill and wondered, “Why is this so high?” You’re not imagining things. Electricity rates in Michigan are significantly higher than the national average.

Let’s break it down:

Utility Company	Residential Rate (¢/kWh)	Service Area	Choice Available
Consumers Energy	24.82	Lower Peninsula	10% Cap
DTE Electric	23.42	Southeast Michigan	10% Cap
Indiana Michigan Power	20.85	Southwest Michigan	10% Cap
UMERC	19.07	Upper Peninsula	10% Cap
UPPCO	31.15	Upper Peninsula	10% Cap
National Average	16.26	USA	Varies

(Source: Michigan Public Service Commission)

Michigan residents pay up to 30% more than the national average. Yet, unlike residents in fully deregulated states like Ohio and Illinois, your ability to switch to a cheaper provider is mostly theoretical.

Understanding the “Choice” Program in Michigan

Michigan technically allows you to choose your electricity supplier thanks to the Electric Choice Program—but with a catch.

What Is the Electric Choice Program?

• Created by Public Act 141 (2000).
• Limited by Public Act 286 (2008) to only 10% of utility customers.
• That means 90% of residents are locked in to monopoly utilities like DTE or Consumers Energy.

Currently, over 5,899 customers are sitting on waiting lists trying to switch, while only 5,514 are enrolled in alternative supplier programs.

Can You Really Switch Providers?

Technically? Yes.

Practically? For most people, no.

If you’re lucky enough to snag a spot under the 10% cap, here’s what the process looks like:

Step-by-Step Guide to Switching (If You’re Eligible)

1. Check your eligibility: Are you in the 10% who can switch? Probably not—but it’s worth checking.
2. Review your current usage: Look at your bill to know your monthly kilowatt-hour (kWh) usage.
3. Search licensed suppliers: Use the MPSC Supplier List to find approved options.
4. Compare offers: Look for:
   • Fixed vs. variable rates
   • Contract length
   • Early termination fees
   • Renewable energy options
5. Join the waiting list: If your area’s cap is full, get on the list. Yes, it’s long.
6. Monitor communications: If you’re selected, act fast to lock in a deal.
7. Check your first bill: Ensure it reflects the new rate and terms.

Who Offers Cheaper Electricity in Michigan?

As of 2024, Michigan has 21 licensed alternative suppliers, including:

• AEP Energy
• Constellation Energy
• Direct Energy
• IGS Energy
• Just Energy
• Nordic Energy Services
• Energy Harbor

Each supplier has different prices and plans. Some focus on competitive rates, others on clean energy. Use Switchalyzer or similar services to be contacted by an expert who can walk you through your options without the research hassle.

You’re on the Waiting List… Now What?

Don’t worry, you still have power—literally. While you wait, here’s how you can cut your energy bill right now:

Smart Home Changes That Save You Money

Upgrade	Estimated Annual Savings	Cost to Install	Payback Time
Programmable Thermostat	$100–$200	$50–$200	6 months–2 years
LED Light Bulbs (Top 5)	$75	$25–$50	4–8 months
Sealing Air Leaks	$100–$300	$100–$500	4 months–2 years
Ceiling Fans	$50–$100	$100–$300	1–3 years
Advanced Power Strips	$100–$200	$30–$100	2–12 months
Energy-Efficient Appliances	$200–$500	$500–$3000	1–6 years
Time-of-Use Scheduling	$50–$150	$0	Immediate
Home Energy Audit	$300–$600	$300–$500	6 months–2 years

(Source: Energy.gov and MPSC reports)

Take Advantage of Time-of-Use (TOU) Pricing

Even if you can’t switch providers, you can still play the system. DTE and Consumers Energy offer Time-of-Use (TOU) programs that let you pay less during off-peak hours.

How It Works:

• Peak Hours: 2–7 PM or 3–7 PM (more expensive)
• Off-Peak Hours: Nights and weekends (cheaper)
• Savings Tip: Run dishwashers, charge EVs, or do laundry during off-peak hours.

Learn more about DTE’s TOU Program and Consumers Energy’s Smart Rate Plan.

Rebates & Incentives That Put Money Back in Your Pocket

Don’t leave cash on the table. These programs pay you to save energy:

Michigan Home Energy Rebates (MiHER)

• Up to $20,000 for energy improvements
• Income-based support
• Covers insulation, HVAC, windows, and more
• Visit MiHER Program Page

Federal Tax Credits

• 30% back, up to $1,200/year on energy projects
• Additional $2,000 for heat pumps
• $150 for a home energy audit
• Details at EnergyStar.gov

Why Is Michigan’s Electricity Market So Limited?

Unlike Illinois or Ohio, where the market is fully open, Michigan has chosen to cap competition. This benefits utility monopolies, but hurts your wallet.

If the cap were removed:

• Demand for alternatives could rise to 25% of customers
• Savings could reach $260/year—equal to a car payment

Learn more about Michigan’s Electric Choice Program.

Final Thoughts: What Can You Actually Do Today?

Let’s face it—doing all the research, comparing rates, understanding contracts, and waiting for a lottery spot under the 10% cap is a hassle. It’s not easy to carve out time to navigate this mess just to save a few bucks.

But savings are possible.

• You can use Switchalyzer or contact an expert to get notified when your area opens up.
• You can slash your energy use with small upgrades.
• You can apply for rebates and optimize your rates without switching.

Bottom line: Don’t wait for the system to change. Start stacking small wins now—and be ready when your shot at cheaper electricity finally comes.

Want Help Navigating the Maze?

If you’re tired of high bills and endless research, let a professional do the digging for you. Services like Switchalyzer help Michigan homeowners monitor rate changes, supplier openings, and rebate opportunities—so you never miss a chance to save.