Miller, Canfield, Paddock and Stone, P.L.C. One Michigan Avenue, Suite 900 Lansing, Michigan TEL (517) FAX (517)

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1 Founded in 1 by Sidney Davy Miller SHERRI A. WELLMAN TEL (17) 9 FAX (17) 76 wellmans@millercanfield.com Miller, Canfield, Paddock and Stone, P.L.C. One Michigan Avenue, Suite 9 Lansing, Michigan 9 TEL (17) 77 FAX (17) 76 MICHIGAN: Ann Arbor Detroit Grand Rapids Kalamazoo Lansing Troy FLORIDA: Tampa ILLINOIS: Chicago NEW YORK: New York CANADA: Windsor CHINA: Shanghai MEXICO: Monterrey POLAND: Gdynia Warsaw Wrocław July 6, 1 Ms. Kavita Kale Executive Secretary Michigan Public Service Commission 719 W. Saginaw Highway, rd Floor Lansing, MI 917 Re: Upper Michigan Energy Resources Corporation Tax Reform Credit B Case No. U1 Dear Ms. Kale: Pursuant to the Commission s Orders issued in Case Nos. U19 and U11, Upper Michigan Energy Resources Corporation hereby files the enclosed Application, and Direct Testimony and Exhibits of Diane J. Mier, and Eric Alan Rogers, to address the Credit B as regarding the effects of the federal Tax Cuts and Jobs Act of 17. Also enclosed are Appearances of Sherri A. Wellman and Paul M. Collins. Finally, please be advised that a draft Notice of Hearing has been ed to Angela Sanderson at sandersona@michigan.gov. Should you have any questions, please kindly advise. Very truly yours, Miller, Canfield, Paddock and Stone, P.L.C. By: Sherri A. Wellman Enclosures cc: Intervenors in Case Nos. U161 and U11 Robert Garvin Theodore Eidukas Dennis M. Derricks Mary Wolter Richard Stasik Vickie Nugent Amy Winkler 11.1\

2 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION ***** In the matter on the Commission s own ) motion, to consider changes in the rates ) of all the Michigan rateregulated ) electric, steam and natural gas utilities ) Case No. U1 to reflect the effects of the federal Tax ) Cuts and Jobs Act of 17: ) UPPER MICHIGAN ENERGY RESOURCES ) CORPORATION files an application for determination ) of Credit B as described in orders U19 and U11. ) APPLICATION Upper Michigan Energy Resources Corporation ( UMERC or the Company ), as directed in the February, 1 Order of the Michigan Public Service Commission ( MPSC or the Commission ) issued in Case No. U19 ( February Order ) and in the May, 1 Order Approving Settlement Agreement in Case No. U11, hereby files its proposal for Credit B to address the impacts of federal corporate tax reduction arising from the Tax Cuts and Jobs Act of 17 ( TCJA ) on its electric and natural gas general base rates from January 1, 1 until June, 1. In support of this Application, UMERC respectfully represents to the Commission as follows: 1. UMERC is a public service corporation organized under the laws of Michigan with service centers located at Industrial Park Drive, Iron Mountain, Michigan, and 1717 Tenth Avenue, Menominee, Michigan. Pursuant to a Settlement Agreement approved by the Commission in Case No. U161 ( U161 Settlement Agreement ), UMERC provides retail electric service to the former Michigan electric customers of Wisconsin Electric Power Company ( WEPCo ) in service areas located in Alger, Baraga, Delta, Dickinson, Gogebic, Houghton,

3 Iron, Marquette, Menominee, and Ontonagon Counties ( WEPCo Rate Zone ), and to the former Michigan electric and natural gas customers of Wisconsin Public Service Corporation ( WPS Corp ) in a service area located in Menominee County, Michigan ( WPSC Rate Zone ).. In the order issued in Case No. U161, UMERC was authorized to adopt the then existing rates and tariffs of WEPCo for its WEPCo Rate Zone, and the then existing rates and tariffs of WPS Corp for its WPSC Rate Zone. WEPCo s last general electric rate case was in Case No. U16, with a final order issued by the Commission on June 6, 1. WPS Corp s last general electric rate case was in Case No. U17669, with a final order issued by the Commission on April, 1, and its last general gas rate case was in Case No. U7, with a final order issued by the Commission on June 7, 19 (these rates were subsequently reduced in Case No. U69 on June 9, 197, as a result of the Tax Reform Act of 196.). In the Commission s February Order, UMERC was directed to file an application to address goingforward adjustments to base rates to reflect the reduction in the federal corporate tax rate from % to 1%. Ordering paragraph D of the February Order directed companies to file supporting testimony and base rate case exhibits similar to those included in the Case No. U1 filing requirements schedules A1 (revenue deficiency/sufficiency), B1 (rate base), C1 (operating income), C (revenue conversion factor), C (federal income tax), and D1 (cost of capital), and any other exhibits required to show the difference between the previously approved revenue requirement reflecting a % federal income tax expense and the new revenue requirement reflecting a 1% federal income tax expense. The companies were also directed to file cost of service studies similar to base rate case schedule F1, and proposed rate design and tariff sheets.

4 . On March 9, 1, UMERC filed with the Commission in Case No. U11 its application and direct testimony addressing the goingforward Credit A TCJA impacts in accordance with the February Order.. On May, 1, the Commission issued its Order Approving Settlement Agreement in Case No. U11 establishing forwardlooking credits (a/k/a Credit A) effective on July 1, 1, and directing UMERC to file its Credit B Application within 6 days of the date of the order. 6. Consistent with the Commission s directives made in the Case Nos. U19 and U11, UMERC is filing herewith the supporting testimony and exhibits for the purposes of addressing Credit B. 7. As reflected in its supporting testimony and exhibits, UMERC has determined the Credit B amounts by using the Credit A rate for each class as established in Case No. U11 and multiplying it by the actual customer consumption from January 1, 1 through June, 1. The tariff sheets reflect Credit B credits to be effective from October 1, 1 to December 1, 1.. UMERC represents that the proposed Credit B credits to its electric and gas rates, as supported by its testimony and exhibits, are just, reasonable, in the public interest, and provide for its electric and gas customers to enjoy the benefits of the tax reduction on a timely basis. WHEREFORE, Upper Michigan Energy Resources Corporation requests that the Commission: A. Approve this Application; B. Find and determine that UMERC s proposed Credit B credits as supported by its testimony and exhibits are reasonable and prudent,

5 C. Authorize UMERC to file and make effective its proposed Credit B credits from October 1, 1 to December 1, 1; and lawful and proper. D. Grant UMERC such other and further relief and authorizations as shall be Respectfully submitted, UPPER MICHIGAN ENERGY RESOURCES CORPORATION Dated: July 6, 1 By: One of its Attorneys Sherri A. Wellman (P99) Paul M. Collins (P69719) MILLER, CANFIELD, PADDOCK AND STONE, P.L.C. One Michigan Avenue, Suite 9 Lansing, MI 9 (17) 77 Attorneys for Upper Michigan Energy Resources Corporation K:\ENERGY GROUP\UMERC\U1 TCJA Credit B\Application UMERC TCJA Credit B U1.docx

6 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION * * * * * In the matter on the Commission s own ) motion, to consider changes in the rates ) of all the Michigan rateregulated ) electric, steam and natural gas utilities ) Case Nos. U1 to reflect the effects of the federal Tax ) Cuts and Jobs Act of 17: ) UPPER MICHIGAN ENERGY RESOURCES ) CORPORATION files an application for determination ) of Credit B as described in orders U19 and U11. ) DIRECT TESTIMONY AND EXHIBITS OF DIANE J. MIER ON BEHALF OF UPPER MICHIGAN ENERGY RESOURCES CORPORATION 1 Q. Please state your name and business address. A. My name is Diane J. Mier and my business address is 7 North Adams Street, Green Bay, Wisconsin Q. By whom are you employed and what is your position? A. I am employed by WEC Energy Group, Inc. ( WEC ) as a Project Specialist. I am testifying in this case on behalf of Upper Michigan Energy Resources Corporation ( UMERC or the Company ) which is a wholly owned subsidiary of WEC. 9 1 Q. Please describe briefly your education, professional, and utility background. A. I have a Bachelor of Science Degree from the University of WisconsinGreen Bay, in Managerial Accounting. I have been employed by Wisconsin Public Service Corporation

7 1 ( WPS Corp ), WPS Corp s predecessor, or WEC since December of, and have held various positions in the NonRegulated and Corporate Risk Departments. In November 1, I transferred to the Regulatory Affairs Department where I currently hold the position of Project Specialist. In my current position, my primary duties are the calculation and administration of natural gas rates for WPS Corp and UMERC Q. Have you previously testified before a regulatory agency? A. Yes. I have previously submitted testimony and exhibits with the Michigan Public Service Commission ( MPSC or the Commission ) in GCR Case Nos. U1779, U 179, U111, U1, and U66 ; EWR Case Nos. U11, U166, and U 16, and TCJA Case No. U Q. On whose behalf are you testifying in this proceeding? A. I am testifying on behalf of UMERC. Q. What is the purpose of your testimony in this proceeding? A. The Commission s February, 1 Order in Case No. U19 ( February Order ), among other things, directed UMERC to develop a backwardlooking credit for the period of January 1, 1 to the date that Credit A was implemented to address the impact of the Tax Cuts and Jobs Act of 17 ( TCJA ) on its customers rates ( Credit 1 B ). Additionally, the Commission s May, 1 Order Approving Settlement 19 1 Agreement in Case No. U11 ( May Order ), which addressed Credit A, directed the Company to file its Credit B application within 6 days of the May Order. The purpose of my testimony is to address the directives of the February Order and May Order and to provide the value of the Credit B calculations with supporting exhibits that relate to natural gas customers.

8 1 Q. Are you sponsoring any exhibits in the proceeding? A. I am sponsoring the following exhibits: Exhibits Content A1 (DJM1) Calculation of Refund Amounts A (DJM) Derivation of Surcharge Credits A (DJM) Proposed Tariff Sheets Q. Were these exhibits prepared by you or under your supervision? A. Yes, they were. Q. As part of the directives made in the Commission s February, 1 order issued in Case No. U19, applications made for Credits A and B were to be accompanied by base rate case exhibits similar to those included in the Case No. U 1 filing requirement schedules ; has the Company complied with the Commission s directive? A. The Company s application for Credit A was supported by a direct case with exhibits similar to those required to satisfy the filing requirements established in Case No. U 19. However, the parties to the Company s Credit A case, reached a settlement and agreed upon credits for each rate class, and it is from these credits that the Company has worked backwards to derive its Credit B amount for the January 1 through June time period and the relevant credits for its rate classes. As such, based on this approach, exhibits which would satisfy the filing requirements established in Case No. U19 would be duplicative to the direct case filing made by the Company in Credit A, and as a practicable matter, would have no relevance to the Company s direct case presentation for Credit B. Therefore, only for purposes of complying with the Commission s

9 February, 1 order in Case No. U19, the Company incorporates by reference, as if fully set out within this filing, its exhibits prefiled in Case No. U11. Q. Please explain how Exhibit A1 (DJM1) was developed. A. Exhibit A1 (DJM1) represents the calculation of the Credit B amounts relating to natural gas service recovered by the Company during the period of January 1 through June, 1. These amounts were determined by applying the Credit A authorized in the Commission s May Order for natural gas customers and applying it to the billed volumes for the period of January 1 through June, 1. As shown in Exhibit A1 (DJM1), the total value of the Credit B is,. Q. How does the Company plan to flowthrough the Credit B total value to its natural gas customers? A. The Company is proposing to passthrough the Credit B value to its natural gas 1 customers through a volumetric credit. Exhibit A (DJM) shows the proposed 1 1 volumetric credit. volumetric credit. Exhibit A (DJM) is the proposed tariff sheet reflecting the Q. How was the volumetric credit derived? A. Taking the total Credit B amount of, that was determined in Exhibit A1 (DJM 1), the Company has derived the credit by spreading the amount over the natural gas forecasted sales for the months of October through December 1. In this way a volumetric credit was developed. The Company has chosen the October through December time period to return the amount to UMERC s natural gas customers as they will benefit from the additional credit in a timely manner. Q. Does this complete your direct testimony at this time?

10 1 A. Yes, it does.

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14 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION ***** In the matter on the Commission s own motion, to consider changes in the rates of all Michigan rateregulated electric, steam and natural gas utilities to reflect the effects of the federal Tax Cut and Jobs Act of 17: UPPER MICHIGAN ENERGY RESOURCES CORPORATION files an application for determination of Credit B as described in orders U19 and U11. ) ) ) ) ) ) ) Case No. U1 DIRECT TESTIMONY AND EXHIBITS OF ERIC ALAN ROGERS ON BEHALF OF UPPER MICHIGAN ENERGY RESOURCES CORPORATION Q. Would you please state your name and your business address? A. My name is Eric Alan Rogers. My business address is 1 W. Michigan Street in Milwaukee, Wisconsin 1. Q. By whom are you employed? A. I am employed by WEC Business Services, which provides various services to Upper Michigan Energy Resources Corporation ( UMERC or Company ). WEC Business Services and UMERC are both whollyowned subsidiaries of WEC Energy Group, Inc. Q. Would you please describe your educational background? A. I earned a Bachelor of Science degree in Civil and Environmental Engineering from the University of Wisconsin Madison in 197 and a Master of Science degree in Environmental Engineering from Stanford University in 197. I also took course work

15 but did not complete a degree at the University of Washington Graduate School of Business. Q. Are you registered as a Professional Engineer in the State of Wisconsin? A. Yes, I am. Q. Would you briefly describe your professional experience prior to joining WEC Business Services? A. I worked for the United States Bureau of Reclamation in Denver, Colorado as a design engineer for two years and for Battelle Pacific Northwest Laboratories in Richland, Washington as a research engineer for three years prior to joining Wisconsin Electric Power Company ( WEPCo ) in 19. Q. Would you describe your responsibilities at WEC Business Services? A. I began in 19 as a forecasting analyst and I developed the residential sales forecast for several rate cases and advance plans for WEPCo. During the mid19s and early 199s, I was responsible for analyzing the cost effectiveness of proposed demandside programs and evaluating the performance of actual demandside programs. In the early 199s, I became responsible for the load research group, and I have since performed numerous analyses of load data. In 1, I developed the load profiling and settlement methodology which is now being used for Michigan customers who select alternate energy suppliers. Around, I assumed responsibilities for costofservice analysis and rate design. I am currently a team leader in the State Regulatory Affairs Department. My responsibilities include class load analyses, revenue forecasts, costofservice studies and rate design and I continue to work closely with the sales forecasting group. Q. Have you previously presented testimony in regulatory proceedings? A. Yes, I presented testimony on costofservice and rate design in previous rate cases before the Michigan Public Service Commission ( Commission ), Case Nos. U171, U 1, U191 and U16. I also presented testimony on energy optimization ( EO ) or energy waste reduction ( EWR ) plans in Case Nos. U11, U16677, U177, U and U167 and on the reconciliation of the WEPCo EO/EWR surcharges for 9 through 17 in Case Nos. U166, U1669, U167, U177, U1767, U 119 and U, respectively, and for the 17 EWR reconciliation for UMERC in

16 Case No. U. I also presented testimony on the impacts to WEPCo s revenue requirements of its proposed ownership exchange agreement with Wolverine Power Supply Cooperative, Inc. for a portion of the Presque Isle Power Plant in Case No. U 171. I also presented testimony in Case Nos. U1779 and U179. Most recently I presented testimony on the Tax Cuts and Jobs Act, Credit A calculation in Case No. U 11. I have also presented testimony on costofservice and rate design in several cases before the Public Service Commission of Wisconsin, including the and carveout rate cases (Docket UR11), the environmental trust financing case (Docket 66 ET1), and the testyear 6,, 1, 1 and 1 rate cases (Dockets UR 1, UR1, UR1, UR16 and UR17, respectively). I also submitted testimony to the Federal Energy Regulatory Commission ( FERC ) in three cases involving power sales agreements with WEPCo s Michigan wholesale customers (Dockets ER6997, ER699 and ER6999) and FERC general rate case (Docket ER61). Q. On whose behalf are you testifying in this proceeding? A. I am testifying on behalf of UMERC. Q. What is the purpose of this testimony? A. The purpose of this testimony is to present UMERC s electric Credit B refund calculations due to the Tax Cuts and Jobs Act (TCJA), as contemplated in Order point B of the February, 1 Order in Case U19 and consistent with the directive made by the Commission in its May, 1 Order Approving Settlement Agreement issued in Case No. U11. Q. Are you sponsoring any exhibits with this testimony? A. Yes. I am sponsoring the following exhibits: Exhibit A (EAR1): Calculation of "Credit B" Refund Amounts for Electric Service Exhibit A (EAR): Calculation of "Credit B" Volumetric Credits for Electric Service Exhibit A6 (EAR): Tariff sheets Q. Were these exhibits prepared by you or under your supervision? A. Yes.

17 Q. As part of the directives made in the Commission s February, 1 Order issued in Case No. U19, applications made for Credits A and B were to be accompanied by base rate case exhibits similar to those included in the Case No. U 1 filing requirement schedules ; has the Company complied with the Commission s directive? A. The Company s application for Credit A was supported by a direct case with exhibits similar to those required to satisfy the filing requirements established in Case No. U 19. However, the parties to the Company s Credit A case, reached a settlement and agreed upon credits for each rate class, and it is from these credits that the Company has worked backwards to derive its Credit B amount for the January 1 through June time period and the relevant credits for its rate classes. As such, based on this approach, exhibits which would satisfy the filing requirements established in Case No. U19 would be duplicative to the direct case filing made by the Company in Credit A, and as a practicable matter, would have no relevance to the Company s direct case presentation for Credit B. Therefore, only for purposes of complying with the Commission s February, 1 order in Case No. U19, the Company incorporates by reference, as if fully set out within this filing, its exhibits prefiled in Case No. U11. Q. Could you explain Exhibit A (EAR1), please? A Yes. Exhibit A (EAR1) shows the calculation of the amount of the TJCA refund accrued over the period January through June of 1. Page 1 shows the actual energy sales by class for each month and page shows the amount of the Credit B refund accrued in each month. The amount of the Credit B refund is simply the monthly sales multiplied by the unit Credit A. The total Credit B refund amount for the period January through June 1 is summed for each customer class in column T. Q. Could you explain Exhibit A (EAR), please? A. Yes. Exhibit A (EAR) shows the calculation of the Credit B volumetric credits for each customer class. Page 1 shows the forecasted energy for the period in which we propose to accomplish the Credit B refunds, October through December 1. On page, the total Credit B refund amount as of the end of June 1 for the period January through June 1 (from Exhibit A (EAR1) page column T) is shown in column H,

18 and is carried through to the end of September 1 in columns I through K. The unit refund is calculated in column M. For those classes with nonzero energy, the unit refund is calculated simply by dividing the total refund amount at the end of September, 1 by the forecasted energy sales for the period October through December 1. For those classes with zero energy, such as several RAS classes, the unit refund is calculated by multiplying the Credit A unit refund by the ratio of the Credit B unit refund to the Credit A unit refund for the corresponding class. This works for all classes except CpLC, which has zero energy in both fullservice and RAS categories. Most of the Credit B unit refunds are roughly two times the Credit A unit refunds, so for CpLC we assigned the Credit B unit refund as two times the Credit A unit refund (it is extremely unlikely that there will be any CpLC customers in the Credit B refund period). Columns O through T show the Credit B refund amounts returned in each month and the remaining balances at the end of each month. The remaining balances at end of December 1 are near zero, but not exactly zero, due to rounding in the credit calculation. These remaining balances are likely small in comparison to what the actual remaining balances will be due to the difference in forecast and actual energy sales. Q Could you explain Exhibit A6 (EAR), please? A Exhibit A6 (EAR) shows the tariff sheets with the Credit B units refunds. These are simply expansions of the current tariff sheets that have the Credit A unit refunds as well. Q. Does this conclude your direct testimony? A. Yes.

19 A B C D E F G H I J Upper Michigan Energy Resources Corporation Case No. U11 Calculation of "Credit B" Refund Amounts for Electric Service Exhibit No. A (EAR1) Page 1 of Witness: Eric A. Rogers Actual Energy WEPCO Zone Full Service <Actual Energy (kwh)> 1 Class 11 RES FLAT Rg1 1 RES TOU Rg 1 SEC FLAT Cg1, Cg, TSSM, TSSU 1 SEC TOU Cg 1 SEC DEMAND TOU Cg, CgC 16 PRIMARY Cp1Low & Med,Cp, Cp, Special Contracts 17 SCHEDULE A 1 CpLC 19 PRIMARY CpMed, CpHigh LIGHTING GI1, Ms, Ms, Cg Lighting 1 Total Jan 1 1,7,6 6,1 6,699,9 6,,,76 9, 6,6,1 6,,61, Feb 1 1,9,6 97,7,16,1,9 1,97,6 1,1 6,17,9 16,97,71, Mar 1 1,71,,6,719, 9,7 1,69,16 9, 6,66,9 1,9 9,,1 Apr 1 1,7,16 6,11,1,61 7,7,6,6 9,79 6,,9 6,1,1, May 1 11,66,7 7,7,9,9 71,9,1,91 76,1 6,6,91,611 7,99, Jun 1 1,9, 1,161,9, 7,76,1,,6 6,77,67,1 9,1,6 Total Energy 77,7,17,116,9,,,771, 1,,,166,9 9,,69 1,6,67 176,,7 WEPCO Zone Retail Access <Actual Energy (kwh)> Class RES FLAT Rg1 6 SEC FLAT Cg1, TSSM, TSSU 7 SEC DEMAND TOU Cg PRIMARY Cp1, Cp 9 SCHEDULE A CpLC 1 Total Jan 1 7,9,7, 1,6,11 1,99,7 17,6,1 Feb 1 1,,9,17,7 1,, 11,97, 1,19,7 Mar 1,6,16,6 99,99 16,1,6,1,179 Apr 1 1,1,91, 1,7,7 11,17,7 16,91,6 May 1 96,,,1 1,1,6 9,,6 1,61,67 Jun 1 1,7,96,1,7 1,16,77 1,76,6 17,11,7 Total Energy,1,9,6, 6,7,1 71,1,9 17,6,1 WPS Zone Full Service <Actual Energy (kwh)> Class RES FLAT Rg1M 6 RES RgOTOU1M 7 SEC FLAT Cg1M SEC CgOTOU1M 9 SEC DEMAND CgM PRIMARY Cp11M, Cp1 1 LIGHTING GY, MS, LS1M Mp1M Total Jan 1 6,1,6 9, 1,16,76,66 7,66 1,,9 17,1 61,7,17,197 Feb 1,,767,9 1,169, 7,9 9,6 1,9, 111,69 7,,,99 Mar 1,17,71 7, 1,1,111 7,79 91,76 1,7,1 17,67 9,1 1,91,7 Apr 1,976,,1 1,,7 67,1 99,7 1,1,6 91,9 6,7 1,,9 May 1,7,9 17, 1,7, 6,9 96,97 1,9,7, 9,1,7,6 Jun 1,1,7 1,19 19,9 6,1 76,91 1,611, 7,,7 1,, Total Energy 1,166,97 1,1, 6,1,9 1,97,,16,611,61 6,9, 1,1,67 WPS Zone Retail Access <Actual Energy (kwh)> 6 Class 7 RES FLAT Rg1M RES RgOTOU1M 9 SEC FLAT Cg1M SEC CgOTOU1M 1 SEC DEMAND CgM PRIMARY Cp11M LIGHTING LS1M Mp1M Total Jan 1 19,1,16,76,1,7 Feb 1 1,199,,66,,61 Mar 1 1,,,99,19,1 Apr 1 17,6,,67,6,11 May 1 (,61),,7,1,76 Jun 1 6,7,,,9,7 Total Energy 16, 1,,6 1,6,6

20 K L M N O P Q R S T Upper Michigan Energy Resources Corporation Case No. U11 Calculation of "Credit B" Refund Amounts for Electric Service Exhibit No. A (EAR1) Page of Witness: Eric A. Rogers Carrying Costs ShortTerm Borrowing Rate fro WEPCo Zone.%.%.%.%.%.% ShortTerm Borrowing Rate fro WPS Zone.%.%.%.%.%.% WEPCO Zone Full Service Unit Credit A Refund End Of 1 Class (/kwh) Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 June, 1 11 RES FLAT Rg1 (.) (7,.97) (,.9) (,.) (6,7.7) (,76.) (,.9) (99,.7) 1 RES TOU Rg (.) (,1.) (,.1) (1,61.) (1,69.) (1,66.6) (1,7.) (1,6.6) 1 SEC FLAT Cg1, Cg, TSSM, TSSU (.11) (7,6.6) (1,1.) (,7.) (1,6.11) (,11.7) (,9.9) (11,.) 1 SEC TOU Cg (.) (1,67.) (.11) (1,1.76) (1,1.7) (1,19.6) (1,1.7) (6,9.) 1 SEC DEMAND TOU Cg, CgC (.1) (,9.7) (,.96) (,91.76) (6,9.6) (,9.1) (,99.) (9,661.1) 16 PRIMARY Cp1Low & Med,Cp, Cp, Special Contracts (.179) (1,761.) (1,7.1) (1,61.17) (1,6.7) (1,1.1) (1,.) (9,7.76) 17 SCHEDULE A 1 CpLC (.6) (.7) 19 PRIMARY CpMed, CpHigh LIGHTING GI1, Ms, Ms, Cg Lighting (.1) (.6) (,69.7) (1,1.) (7,99.6) (1,977.9) (,6.1) (1,9.1) (,.6) (1,66.1) (,6.7) (1,76.9) (,.19) (,76.19) (1,6.) (1,.) 1 Total (16,.) (9,9.) (9,9.67) (,.1) (7,19.) (91,7.) (,77.) WEPCO Zone Retail Access Unit Credit A Refund End Of Class (/kwh) Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 June, 1 RES FLAT Rg1 (.9) 6 SEC FLAT Cg1, TSSM, TSSU 7 SEC DEMAND TOU Cg (.1) (.1) (,7.) (,.17) (,.) (,97.7) (,6.) (,91.1) (,.) (,61.1) (,.) (,796.19) (,17.) (16,7.) (6,.6) (,9.) PRIMARY Cp1, Cp 9 SCHEDULE A (.9) (.1) (9.) (1,7.9) (99.6) (1,6.1) (91.) (1,9.1) (1,.) (1,6.6) (1,.9) (1,11.96) (1,16.) (1,9.) (6,7.1) (,619.7) CpLC (.1) 1 Total WPS Zone Full Service (9,717.7) (11,6.) (11,.9) (1,.) (1,.79) (11,9.6) (6,7.) Unit Credit A Refund End Of Class (/kwh) Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 June, 1 RES FLAT Rg1M (.) (,9.) (,.99) (,.9) (,61.) (1,67.) (1,7.9) (11,9.7) 6 RES RgOTOU1M (.6) (1,.7) (1.9) (7.) (76.6) (6.6) (9.7) (,.1) 7 SEC FLAT Cg1M (.6) (,.17) (,.11) (,66.) (,1.) (,9.) (,976.) (,7.) SEC CgOTOU1M (.) (76.67) (1.) (9.6) (.) (.) (16.) (1,7.9) 9 SEC DEMAND CgM (.61) (,171.6) (,76.) (,16.67) (,7.) (,.) (,77.) (19,7.71) PRIMARY Cp11M, Cp1 (.11) (1,17.7) (1,7.) (1,6.7) (1,7.) (1,.) (17,17.7) (9,7.) 1 LIGHTING GY, MS, LS1M Mp1 (.) (.9) (1,96.1) (.17) (9.) (19.9) (61.1) (19.7) (7.7) (16.6) (67.6) (19.) (.6) (1.) (,.7) (1,1.) Total (,1.6) (,99.6) (,6.) (7,16.17) (,16.) (,.6) (7,.7) WPS Zone Retail Access Unit Credit A Refund End Of 6 Class (/kwh) Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 June, 1 7 RES FLAT Rg1M RES RgOTOU1M 9 SEC FLAT Cg1M SEC CgOTOU1M (.16) (.111) (.1) (.9) 1 SEC DEMAND CgM (.) (1.9) (1.1) (1.) (9.71). (.) (69.) PRIMARY Cp11M (.17) (67.96) (1.6) (.16) (16.) (9.) (1.6) (,66.) LIGHTING LS1M Mp1 (.7) (.6) Total (7.9) (.7) (1.19) (6.9) (7.) (6.) (,.)

21 A B C D E F Upper Michigan Energy Resources Corporation Calculation of "Credit B" Volumetric Credits for Electric Service Case No. U11 Exhibit No. A (EAR) Page 1 of Witness: Eric A. Rogers 1 WEPCO Zone Full Service <Forecasted Energy (kwh)> 11 Class 1 RES FLAT Rg1 1 RES TOU Rg 1 SEC FLAT Cg1, Cg, TSSM, TSSU 1 SEC TOU Cg 16 SEC DEMAND TOU Cg, CgC 17 PRIMARY Cp1Low & Med,Cp, Cp, Special Contracts 1 SCHEDULE A 19 CpLC PRIMARY CpMed, CpHigh 1 LIGHTING GI1, Ms, Ms, Cg Lighting Total Oct 1 11,9,9 6,6,61,,,1,99 97,6,69,9 76,16 7,6,6 Nov 1 1,6,19 96,,79,6 6,7 1,77,99 9,16,96,7 61,9,,1 Dec 1 1,99,79 61,911,797,69 7,7,11, 1,179,96 6,1,99 6,,,77 Total 9,79,916 1,,6 17,1,769,,66,969,7,991,66 1,7,67 1,1,9, WEPCO Zone Retail Access <Forecasted Energy (kwh)> Class 6 RES FLAT Rg1 7 SEC FLAT Cg1, TSSM, TSSU SEC DEMAND TOU Cg 9 PRIMARY Cp1, Cp SCHEDULE A 1 CpLC Total Oct 1 979,,,6 1,171,79 1,,11 19,,1 Nov 1 9,1,696,16 96,9 1,, 19,9, Dec 1,969,6, 1,, 1,,69 19,1,16 Total,7,11 1,1,76,, 9,,77,61,19 WPS Zone <Forecasted Energy (kwh)> Class 6 RES FLAT Rg1M 7 RES RgOTOU1M SEC FLAT Cg1M 9 SEC CgOTOU1M SEC DEMAND CgM 1 PRIMARY Cp11M, Cp1 LIGHTING GY, MS, LS1M Mp1 Total Oct 1,6,6 1,96 99,6 6,7 6,69 1,69, 11,,6 19,, Nov 1,9,97 177, 1,6,67 7,96,666 1,777, 1,6 6,6,6,99 Dec 1,99, 9, 1,19,91 7, 967,1 1,, 1,16 7,67 1,, Total 1,,17 61,,7,6 1,,677,,69, 66, 16,1 61,79, 6 WPS Zone Retail Access <Forecasted Energy (kwh)> 7 Class RES FLAT Rg1M 9 RES RgOTOU1M SEC FLAT Cg1M 1 SEC CgOTOU1M SEC DEMAND CgM PRIMARY Cp11M LIGHTING GY, MS, LS1M Mp1 6 Total Oct 1 1,6,1,,9,6 Nov 1 1,7,1,,,7 Dec 1 16,,,,6, Total, 6,9, 6,9,

22 G H I J K L M N O P Q R S T Upper Michigan Energy Resources Corporation Case No. U11 Calculation of "Credit B" Volumetric Credits for Electric Service Exhibit No. A (EAR) Page of Witness: Eric A. Rogers Jul 1 Aug 1 Sep 1 Oct 1 Nov 1 Dec 1 Forecast of ShortTerm Borrowing Rate for WEPCo Zone.%.%.%.%.%.% Forecast of ShortTerm Borrowing Rate for WPS Zone.%.%.%.%.%.% Credit B for WEPCO Zone Full Service Refund As Of September, Credit B Refund in November November, Unit Credit B Refund Credit B Refund in Class June, 1 July, 1 August, 1 1 (/kwh) October 1 October, RES FLAT Rg1 (99,) (99,) (99,) (99,) (.7) (9,7) (9,76) (96,7) (11,7) (11,76) 16 RES TOU Rg (1,7) (1,7) (1,7) (1,7) (.77) (,16) (7,) (,7) (,) (,19) () SEC FLAT Cg1, Cg, TSSM, TSSU (11,9) (11,9) (11,9) (11,9) (.) (6,6) (9,11) (7,9) (7,) (7,1) (1) SEC TOU Cg (6,9) (6,9) (6,9) (6,9) (.) (1,) (,1) (,) (,96) (,9) () SEC DEMAND TOU Cg, CgC (9,661) (9,661) (9,661) (9,661) (.97) (1,) (19,9) (,67) (1,) (1,1) PRIMARY Cp1Low & Med,Cp, Cp, Special Contracts (9,) (9,) (9,) (9,) (.9) (,6) (6,) (,9) (,69) (,6) () SCHEDULE A (.1) CpLC (.1) PRIMARY CpMed, CpHigh (,76) (,76) (,76) (,76) (.) (1,7) (,) (16,796) (1,9) (1,11) 1 LIGHTING GI1, Ms, Ms, Cg Lighting (1,) (1,) (1,) (1,) (.176) (,) (6,71) (,7) (,6) (,6) () Total (,77) (,77) (,77) (,77) (17,) (,6) (11,) (,6) (,7) 7 Credit B for WEPCO Zone Retail Access Refund As Of September, Credit B Refund in November Refund Ed of November, Credit B Refund in December December, Refund End Of Unit Credit B Refund Credit B Refund in Class June, 1 July, 1 August, 1 1 (/kwh) October 1 October, RES FLAT Rg1 (.6) SEC FLAT Cg1, TSSM, TSSU (16,7) (16,7) (16,7) (16,7) (.61) (,6) (1,9) (,) (,1) (,7) () SEC DEMAND TOU Cg (,9) (,9) (,9) (,9) (.61) (9,9) (,7) (1,) (1,1) (1,9) (6) PRIMARY Cp1, Cp (6,7) (6,7) (6,7) (6,7) (.17) (,191) (,66) (1,) (,1) (,) SCHEDULE A (,6) (,6) (,6) (,6) (.) (,91) (,69) (,91) (,7) (,76) 6 CpLC (.) Total (6,7) (6,7) (6,7) (6,7) (,99) (,761) (,6) (,19) (,191) () Credit B for WPS Zone Refund As Of September, Credit B Refund in November Refund Ed of November, Credit B Refund in December December, Refund End Of Unit Credit B Refund Credit B Refund in Class June, 1 July, 1 August, 1 1 (/kwh) October 1 October, RES FLAT Rg1M (11,1) (11,1) (11,1) (11,1) (.91) (1,) (99,9) (,917) (,1) (,6) RES RgOTOU1M (,) (,) (,) (,) (.7) (1,1) (,7) (1,9) (1,1) (1,) 1 SEC FLAT Cg1M (,7) (,7) (,7) (,7) (.716) (7,1) (16,) (7,66) (,) (,) 16 SEC CgOTOU1M (1,7) (1,7) (1,7) (1,7) (.671) () (1,) (96) (6) (7) SEC DEMAND CgM (19,71) (19,71) (19,71) (19,71) (.7) (,99) (1,) (6,6) (6,99) (6,96) PRIMARY Cp11M, Cp1 (9,7) (9,7) (9,7) (9,7) (.) (9,9) (61,) (,6) (1,19) (1,67) LIGHTING GY, MS, LS1M (,1) (,1) (,1) (,1) (.11) (1,) (,6) (1,617) (1,71) (1,7) (1) Mp1 (1,1) (1,1) (1,1) (1,1) (.6) () () (6) (9) (9) Total (7,) (7,) (7,) (7,) (,19) (19,6) (9,) (16,) (16,166) 1 Credit B for WPS Zone Retail Access Refund As Of September, Credit B Refund in November Refund Ed of November, Credit B Refund in December December, Refund End Of Unit Credit B Refund Credit B Refund in Class June, 1 July, 1 August, 1 1 (/kwh) October 1 October, RES FLAT Rg1M (.9) RES RgOTOU1M (.) SEC FLAT Cg1M (.1) SEC CgOTOU1M (.176) SEC DEMAND CgM (7) (7) (7) (7) (.1) () (7) () () () PRIMARY Cp11M (,66) (,66) (,66) (,66) (.6) (7) (1,69) () (777) () 1 LIGHTING GY, MS, LS1M (.96) Mp1 (.19) Total (,6) (,6) (,6) (,6) (79) (1,66) () () () 1 Credit B Refund in December December,

23 M.P.S.C. No. 1 Electric Upper Michigan Energy Resources Corporation Case U1 Exhibit A6 (EAR) WEPCo Rate Zone First Revised Sheet No. D7.1 Replaces Original Sheet No. D7.1 TAX CUTS AND JOBS ACT OF 17 CREDIT (TCJA) FULL REQUIREMENTS SERVICE TCJA Credits are applicable to the rate schedules as indicated below for customers contracting for full requirements service. Customers shall receive Credit A until the Company is authorized new base rates in a general rate case proceeding. Customers shall receive Credit B for the period October 1, 1 through December 1, 1. Credit A Credit B Rate Schedule No. /kwh /kwh Rg 1 (.) (.7) Rg (.) (.77) Cg 1, Cg, TssM, TssU (.11) (.) Cg (.) (.) Cg, CgC (.1) (.97) Cp (.1) (.) Cp 1, Cp, Cp, Special Contract (.179) (.9) Schedule A (.6) (.1) Cp LC (.7) (.1) Ms, Ms, GL1, LED1, Mg 1 (.6) (.176) The following rate schedules shall receive a TCJA Credit as indicated above consistent with the rate schedule under which the customer is served. The TCJA credit is not prorated based on the level of participation selected under rate schedules ERER1, ERER or ERER. RETAIL ACCESS SERVICE Rate Schedule No. ERER1 ERER ERER DS1 CGS Category 1 CGS Category CGS Biogas TCJA Credits are applicable to the rate schedules as indicated below for customers contracting for retail access service. Customers shall receive Credit A until the Company is authorized new base rates in a general rate case proceeding. Customers shall receive Credit B for the period October 1, 1 through December 1, 1. Credit A Credit B Rate Schedule No. /kwh /kwh Rg 1 (.9) (.6) Cg 1, TssM, TssU (.1) (.61) Cg (.1) (.61) Cp 1, Cp (.9) (.17) Schedule A (.1) (.) Cp LC (.1) (.) Issued mmddyy Effective for service rendered on and T. T. Eidukas after mmmdddyyy VicePresident, Milwaukee, Wisconsin Issued under authority of the Michigan Public Service Commission dated mdy in Case No. U1

24 M.P.S.C. No. 1 Electric Upper Michigan Energy Resources Corporation Case U1 Exhibit A6 (EAR) WPSC Rate Zone First Revised Sheet No. D1. Replaces Original Sheet No. D1. D1. TAX CUTS AND JOBS ACT OF 17 CREDIT (TCJA) TCJA TCJA Credits are applicable to the rate schedules as indicated below for customers that purchase power supply service from the Company. Customers shall receive Credit A until the Company is authorized new base rates in a general rate case proceeding. Customers shall receive Credit B for the period October 1, 1 through December 1, 1. Credit A Credit B Rate Schedule No. /kwh /kwh Rg1M (.) (.91) RGOTOU1M (.6) (.7) Cg1M (.6) (.716) CgM (.61) (.7) CgOTOU1M (.) (.671) Cp1M, CpI (.11) (.) Mp1M (.9) (.6) Ls1M (.) (.11) The following rate schedules shall receive a TCJA Credit as indicated above consistent with the rate schedule under which the customer is served. Rate Schedule No. PG1M PG1AM PG1BM TCJA Credits are applicable to the rate schedules as indicated below for customers taking service under the Retail Access Service tariff (RAS1). Customers shall receive Credit A until the Company is authorized new base rates in a general rate case proceeding. Customers shall receive Credit B for the period October 1, 1 through December 1, 1. Credit A Credit B Rate Schedule No. /kwh /kwh Rg1M (.16) (.9) RGOTOU1M (.111) (.) Cg1M (.1) (.1) CgM (.) (.1) CgOTOU1M (.9) (.176) Cp1M (.17) (.6) Ls1M (.7) (.96) Mp1M (.6) (.19) Issued mmddyy Effective for service rendered on and T. T. Eidukas after mmmdddyyy VicePresident, Milwaukee, Wisconsin Issued under authority of the Michigan Public Service Commission dated mdy in Case No. U1

25 MICHIGAN DEPARTMENT OF LICENSING AND REGULATORY AFFAIRS PUBLIC SERVICE COMMISSION ENTRY OF APPEARANCE IN AN ADMINISTRATIVE HEARING This form is issued as provided for by 199 PA, as amended, and by 19 PA, as amended. The filing of this form, or an acceptable alternative, is necessary to ensure subsequent service of any hearing notices, Commission orders, and related hearing documents. General Instructions: Type or print legibly in ink. For assistance or clarification, please contact the Public Service Commission at (17) 9. Please Note: The Commission will provide electronic service of documents to all parties in this proceeding. THIS APPEARANCE TO BE ENTERED IN ASSOCIATION WITH THE ADMINISTRATIVE HEARING: Case / Company Name: Docket No. Please enter my appearance in the aboveentitled matter on behalf of: 1. (Name). (Name). (Name). (Name). (Name) 6. (Name) 7. (Name) Name Address City State Zip Phone ( ) I am not an attorney I am an attorney whose: Michigan Bar # is P Bar # is: ( state ) Date Signature: EAHR1 9/9/16

26 MICHIGAN DEPARTMENT OF LICENSING AND REGULATORY AFFAIRS PUBLIC SERVICE COMMISSION ENTRY OF APPEARANCE IN AN ADMINISTRATIVE HEARING This form is issued as provided for by 199 PA, as amended, and by 19 PA, as amended. The filing of this form, or an acceptable alternative, is necessary to ensure subsequent service of any hearing notices, Commission orders, and related hearing documents. General Instructions: Type or print legibly in ink. For assistance or clarification, please contact the Public Service Commission at (17) 9. Please Note: The Commission will provide electronic service of documents to all parties in this proceeding. THIS APPEARANCE TO BE ENTERED IN ASSOCIATION WITH THE ADMINISTRATIVE HEARING: Case / Company Name: Docket No. Please enter my appearance in the aboveentitled matter on behalf of: 1. (Name). (Name). (Name). (Name). (Name) 6. (Name) 7. (Name) Name Address City State Zip Phone ( ) I am not an attorney I am an attorney whose: Michigan Bar # is P Bar # is: ( state ) Date Signature: EAHR1 9/9/16

27 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION * * * * * In the matter of the Commission s own ) motion, to consider changes in the rates ) of all the Michigan rateregulated ) Case No. U1 electric steam and natural gas utilities ) to reflect the effects of the federal Tax ) Cuts and Jobs Act of 17: ) UPPER MICHIGAN ENERGY RESOURCES ) CORPORATION files an application for determination ) of Credit B as described in orders U19 and U11. ) STATE OF MICHIGAN ) ) ss COUNTY OF INGHAM ) PROOF OF SERVICE Jennifer Joy Yocum, being first duly sworn, deposes and says that on July 6, 1, she served a copy of the direct case on the persons listed below via electronic mail: Toni L. Newell Timothy J. Lundgren Michael E. Moody Jennifer U. Heston Jason T. Hanselman Andrew J. Switalski Richard J. Aaron tlnewell@varnumlaw.com tjlundgren@varnumlaw.com moodym@michigan.gov jheston@fraserlawfirm.com jhanselman@dykema.com aswitalski@dykema.com raaron@dykema.com Jennifer Joy Yocum Subscribed and sworn before me on this 6 th day of July, 1. Crystal L. Chacon, Notary Public State of Michigan, Ingham County My Commission Expires: May,