NMichigan Utility Must Issue Ice Storm Outage Bill Credits After Trying to Skip Payouts

## Alpena Power to Issue $645K in Bill Credits After Ice Storm Dispute

ALPENA,MI – A small northern Michigan utility will be required to issue nearly $645,000 in bill credits to customers who went days or weeks without power during a massive ice storm this spring – after initially trying to dodge the requirement by arguing the blitz of ice was an unprecedented “act of god” beyond its control.

Alpena Power Co. must pony up the required credits under a settlement agreement OK’d by state regulators on friday, Dec. 5, more than eight months after the storm.Some customers who were left in the dark for almost two weeks could be entitled to at least $400 in credits under state rules requiring for-profit utilities to issue them automatically after extended or repeated outages.

The credits,set at $40 at the time of the storm and since raised to $42,stack up by the day after a certain time period without power has elapsed.But Alpena Power Co. also has a pathway to recoup nearly half of the costs: by charging them to its customers.

Under the agreement approved by the Michigan Public Service Commission, it can seek to incorporate into power rates some outage credit costs, when the issues stem from portions of the grid outside its control.

Outages on high-voltage transmission lines, overseen by a separate utility company, led to massive blackouts affecting nearly all of Alpena Power’s 16,775 customers during the storm.

Alpena Power doesn’t generate electricity and relies on the regional lines to distribute power to customers. If they go down, it cannot serve customers, and that was a “importent portion” of what happened during the ice storm, Alpena Power President and Chief Operating Officer Ken Dragiewicz said in an email to MLive.

The agreement gives Alpena Power Co. the possibility – not the guarantee – of eventually charging customers for about $332,806 of the $643,737 in estimated outage credits it will issue, accordin

Alpena Power Reaches Settlement on Ice Storm Outage Credits, Averting Larger Grid Investment Concerns

Alpena Power has reached a settlement with state regulators regarding the costs associated with outage credits following the damaging ice storm of February 2023. The agreement, finalized in late 2025, substantially reduces the financial burden on the utility compared to initial estimates, allowing it to proceed with necessary grid improvements.This comes after initial concerns that fully funding the credits would hinder future investments in infrastructure designed to prevent future outages.

Background: The February 2023 Ice Storm and Initial Concerns

A severe ice storm swept through Michigan in February 2023,causing widespread power outages and significant damage to infrastructure. Alpena Power,serving customers in northeastern Lower Michigan,reported approximately $2.8 million in losses due to the storm. https://www.mlive.com/news/2023/02/alpena-power-customers-could-see-credits-for-february-ice-storm-outages.html

Initially, the full cost of providing outage credits to customers raised concerns about the utility’s ability to fund critical grid upgrades. According to David Dragiewicz, president of Alpena Power, paying the full credit amount could “limit our ability to invest in the grid to reduce future outages.” As the second-smallest investor-owned utility in the state, Alpena Power is especially sensitive to financial losses that could impact its long-term infrastructure plans.

The Settlement and its Impact

The settlement reached in December 2025 allows Alpena Power to recover some costs from customers while significantly reducing the overall financial impact of the outage credits. While details of the settlement are not fully public, it represents a compromise that addresses both customer needs and the utility’s financial stability.

“With the smaller,updated outage credit cost estimate and the settlement allowing some costs to be recovered from customers,the outlook is “more optimistic than it was originally,” Dragiewicz stated in a recent interview. https://www.mlive.com/news/2025/12/06/alpena-power-reaches-settlement-on-ice-storm-outage-credits-easing-grid-investment-fears.html

What Does This mean for Customers?

Customers who experienced outages during the February 2023 ice storm will receive credits on their bills, the amount of which will be persistent by the specifics of the settlement. the exact credit amount and timeframe for distribution will be communicated directly to customers by Alpena Power.

Why Grid Investment is Crucial

Investing in grid modernization is essential for improving reliability and resilience, particularly in regions prone to severe weather events. Upgrades can include:

* Tree Trimming: Removing trees that could fall on power lines during storms.
* Pole Replacement: Replacing aging poles with stronger, more durable materials.
* Undergrounding Lines: Placing power lines underground to protect them from weather damage.
* Smart Grid Technologies: Implementing technologies that can automatically detect and isolate outages, speeding up restoration times.

Key Takeaways

* Alpena power has reached a settlement with regulators regarding outage credits from the February 2023 ice storm.
* The settlement reduces the financial burden on the utility, allowing it to continue investing in grid improvements.
* Customers who experienced outages will receive credits on their bills.
* Continued grid investment is vital for improving power reliability and reducing the impact of future storms.

Looking Ahead

The settlement represents a positive step for both Alpena power and its customers. By balancing the need for customer relief with the importance of infrastructure investment, the agreement sets the stage for a more resilient power grid in northeastern Michigan. Alpena Power is expected to announce specific details regarding the credit distribution and its upcoming grid investment plans in early 2026.