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Founded in 1852 by Sidney Davy Miller SHERRI A. WELLMAN TEL (517) 483-4954 FAX (517) 374-6304 E-MAIL wellmans@millercanfield.com Miller, Canfield, Paddock and Stone, P.L.C. One Michigan Avenue, Suite 900 Lansing, Michigan 48933 TEL (517) 487-2070 FAX (517) 374-6304 www.millercanfield.com July 27, 2018 MICHIGAN: Ann Arbor Detroit Grand Rapids Kalamazoo Lansing Troy FLORIDA: Tampa ILLINOIS: Chicago NEW YORK: New York OHIO: Cleveland CANADA: Windsor CHINA: Shanghai MEXICO: Monterrey POLAND: Gdynia Warsaw Wrocław Ms. Kavita Kale Executive Secretary Michigan Public Service Commission 7109 W. Saginaw Highway, 3rd Floor Lansing, MI 48917 Re: SEMCO Energy Gas Company Tax Reform Credit B Case No. U-20182 Dear Ms. Kale: Pursuant to the Commission s orders issued in Case Nos. U-18494 and U-20115, SEMCO Energy Gas Company hereby files the enclosed Application, and Direct Testimony and Exhibits of Steven Q. McLean to address the Credit B effects of the federal Tax Cuts and Jobs Act of 2017. Also enclosed is the Appearance of Sherri A. Wellman and the Proof of Service. Finally, please be advised that a draft Notice of Hearing has been emailed to Angela Sanderson at sandersona2@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 SAW/kf Enclosures cc: Intervenors in Case Nos. U-16169 and U-20115 Steven Q. McLean

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 rate-regulated ) electric, steam and natural gas utilities ) Case No. U-20182 to reflect the effects of the federal Tax ) Cuts and Jobs Act of 2017: ) SEMCO ENERGY GAS COMPANY ) files an application for determination of Credit B ) as described in orders U-18494 and U-20115. ) APPLICATION SEMCO Energy Gas Company ( SEMCO Gas or the Company ), a division of SEMCO Energy, Inc., as directed in the February 22, 2018 Order of the Michigan Public Service Commission ( MPSC or the Commission ) issued in Case No. U-18494 ( February 22 Order ) and in the May 30, 2018 Order Approving Revised Settlement Agreement issued in Case No. U-20115, 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 2017 ( TCJA ) on its natural gas rates from January 1, 2018 until June 30, 2018. In support of this Application, SEMCO Gas respectfully represents to the Commission as follows: 1. SEMCO Gas, with its principal office located at 1411 Third Street, Suite A, Port Huron, Michigan, is engaged as a public utility in the business of transporting, supplying and distributing natural gas to the public in its various service areas located in the Lower and Upper Peninsulas of Michigan. 2. SEMCO Gas s retail natural gas sales business and retail gas transportation business are subject to the jurisdiction of the Commission.

3. SEMCO Gas s last general rate case for retail gas service was in Case No. U- 16169, with a final order issued by the Commission in that case on January 6, 2011. 4. In the Commission s February 22 Order, SEMCO Gas was directed to file an application to address going-forward adjustments to base rates to reflect the reduction in the federal corporate tax rate from 35% to 21%. Ordering paragraph D of the February 22 Order directed companies to file supporting testimony and base rate case exhibits similar to those included in the Case No. U-18238 filing requirements schedules A1 (revenue deficiency/sufficiency), B1 (rate base), C1 (operating income), C2 (revenue conversion factor), C8 (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 35% federal income tax expense and the new revenue requirement reflecting a 21% 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. 5. On March 29, 2018, SEMCO Gas filed with the Commission in Case No. U- 20115 its application and direct testimony addressing the going forward Credit A TCJA impacts in accordance with the February 22 Order. 6. On May 30, 2018, the Commission issued its Order Approving Revised Settlement Agreement in Case No. U-20115 establishing forward-looking credits (a/k/a Credit A) effective on July 1, 2018, and directing SEMCO Gas to file its Credit B Application within 60 days of the date of the order. 7. Consistent with the Commission s directives made in Case Nos. U-18494 and U- 20115, SEMCO Gas is filing herewith supporting testimony and exhibits for the purposes of addressing Credit B. 2

8. As reflected in its supporting testimony and exhibits, SEMCO Gas has determined the Credit B amounts by using the Credit A rate for each class as established in Case No. U- 20015 and multiplying it by the actual customer consumption from January 1, 2018 through June 30, 2018. For purposes of the Main Replacement Program ( MRP ), SEMCO Gas has determined the Credit B amount by multiplying the decrease in the MRP surcharges approved in Case No. U-20015 by the actual meter counts, by rate schedule, for the same period. The tariff sheets reflect Credit B credits to be effective for October 2018. 9. SEMCO Gas represents that the proposed Credit B credits to its natural gas rates, as supported by its testimony and exhibits, are just, reasonable, in the public interest, and provide for its natural gas customers to enjoy the benefits of the tax reduction on a timely basis. WHEREFORE, SEMCO Energy Gas Company requests that the Commission: A. Approve this Application; B. Find and determine that SEMCO Gas s proposed Credit B credits as supported by its testimony and exhibits are reasonable and prudent, C. Authorize SEMCO Gas to file and make effective its proposed Credit B credits for October 2018 and D. Grant SEMCO Gas such other and further relief and authorizations as shall be lawful and proper. 3

Respectfully submitted, SEMCO ENERGY GAS COMPANY Dated: July 27, 2018 By: One of its Attorneys Sherri A. Wellman (P38989) Paul M. Collins (P69719) MILLER, CANFIELD, PADDOCK AND STONE, P.L.C. One Michigan Avenue, Suite 900 Lansing, MI 48933 (517) 487-2070 Attorneys for SEMCO Energy Gas Company K:\ENERGY GROUP\SEMCO\U-20182 TCJA Credit B\Application - SEMCO TCJA Credit B U-20182.docx 4

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 rate-regulated ) electric, steam and natural gas utilities ) Case No. U-20182 to reflect the effects of the federal Tax ) Cuts and Jobs Act of 2017: ) SEMCO ENERGY GAS COMPANY ) files an application for determination of Credit B ) as described in orders U-18494 and U-20115. ) DIRECT TESTIMONY AND EXHIBITS OF STEVEN Q. MCLEAN ON BEHALF OF SEMCO ENERGY GAS COMPANY July 27, 2018

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 Q. Please state your name and business address. A. My name is Steven Q. McLean. My business address is 1411 Third Street, Port Huron, Michigan 48060. 4 5 6 7 8 9 10 11 12 13 14 Q A Q A By whom are you employed and what is your position? I am employed by SEMCO Energy Gas Company ( SEMCO Gas or the Company ), a division of SEMCO Energy, Inc. ( SEMCO ), as its Director of Regulatory Affairs. What are your responsibilities as Director of Regulatory Affairs? I am responsible for all SEMCO Gas regulatory matters involving the Michigan Public Service Commission ( MPSC or the Commission ) and the Federal Energy Regulatory Commission. In addition, I am responsible for the Company s Energy Waste Reduction Program. 15 16 17 18 Q. Would you briefly describe your educational background? A. I earned a Bachelor s of Science Degree in Political Science and Economics from Central Michigan University in May 2003. I earned a Master s of Arts Degree in Economics from Central Michigan University in December 2007. 19 20 21 22 23 Q. Have you attended any seminars or other training courses? A. Yes, in May 2006, I attended the Association of Edison Illuminating Companies Fundamentals of Customer Load Analysis Seminar. In August 2006, I completed the National Regulatory Utilities Commissioners annual regulatory studies program held at 24 Michigan State University. In October 2010, I attended the Association of Edison 25 Illuminating Companies Advanced Course in Customer Load Research. 1

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 4 5 6 7 8 9 Q. Please summarize your employment and professional experience. A. In January 2006, I joined the MPSC where I held various positions of increasing responsibility. In 2011, I was promoted to the Manager of the Rates and Tariffs section. The responsibilities of that section included, but were not limited to, analyzing utility reports, financial records, and rate case filings to determine the appropriate level of rates for regulated energy utilities, utilizing laws, regulations, and Commission policies. In August of 2014, I was hired by SEMCO Gas as the Rates and Regulatory Affairs Manager. In December of 2016, I was promoted to my current position as Director of Regulatory Affairs. 10 11 12 13 Q. Have you previously testified in any regulatory proceedings before the Commission? A. Yes. I have testified before the MPSC in numerous general rate cases and other miscellaneous proceedings on behalf of the MPSC Staff and SEMCO Gas. 14 15 16 17 18 19 Q. Please identify the exhibits which you are sponsoring in this case. A. I am sponsoring: Exhibit A-1 Calculation of Credit B amount Exhibit A-2 Calculation of Credits B Exhibit A-3 Credit B Tariff Sheets 20 21 22 Q. Were these exhibits prepared by you or under your direction and supervision? A. Yes. 23 24 Q. What is the purpose of your testimony in this proceeding? 2

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 4 A. The purpose of my testimony is to satisfy the directives of the Commission s February 22, 2018 Order in Case No. U-18484 addressing the federal Tax Cuts and Jobs Act of 2017 ( TCJA ) and the May 30, 2018 Order Approving Settlement Agreement in Case No. U- 20115 and provide the calculation for Credits B. 5 6 7 8 9 10 11 12 13 14 Q. How was the Credit B developed? A. To develop the Credit B the Company used the Credits A and lower Main Replacement Program ( MRP ) surcharges, approved in Case No. U-20115, and the actual sales and customer counts for the period of January 1, 2018 through the start of Credit A. The intended result of the Company s Credit B calculations is to reflective of what would have occurred had the Credits A and lower MRP surcharges been in place beginning January 1, 2018. The Credits A and lower MRP surcharges, which went into effect for the first billing cycle of July 2018 and will remain in place until rates are set in a future rate case, were approved in Case No. U-20115 to address the impact of the TCJA. 15 16 17 18 19 20 21 22 Q. How was the Credit B calculated? A. As illustrated in Exhibit A-1, the non-mrp portion of Credit B was calculated by multiplying the Credits A by the actual sales by rate schedule for the period of January 1, 2018 through June 30, 2018. The MRP portion of Credit B was calculated by multiplying the decrease in the MRP surcharges by the actual meter counts by rate schedule for the same period. The non-mrp and MRP portions were then added together to create a total Credit B by rate schedule. 23 24 25 Q. How does the Company propose to allocate Credit B to residential and general service customers? 3

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 4 A. As illustrated in Exhibit A-2, for residential and general service customers, the Company proposes to apply a one-month per meter credit (Credits B) to of the TCJA savings for the period of January 1, 2018 through June 30, 2018. The proposed Credits B are reflected in the proposed tariffs sheets sponsored as Exhibit A-3. 5 6 7 8 9 10 11 12 Q. Why is the Company proposing to allocate Credit B on a per meter basis for residential and general service customers? A. By crediting on a per meter basis the Company can quickly, accurately and fairly allocate the Credit B by residential and general service rate schedules. Weather can cause significant fluctuations in usage making a volumetric based allocation varied for the residential and general service rate schedules. In addition, typical usage within these rate schedules does not fluctuate significantly by customer. 13 14 15 16 17 18 19 Q. How does the Company propose to effectuate Credit B to transportation customers? A. The Company proposes to effectuate Credit B to transportation customers based on the actual volumes of a given billing period. All transportation customers, unlike residential and general service customers, are billed for the same calendar month. This gives the Company the opportunity to calculate a volumetric credit by rate schedule that will precisely refund the total Credit B as calculated on Exhibit A-1. 20 21 22 23 24 25 Q. How will the Company calculate the volumetric Credits B for the transportation customers? A. The Company bills all transportation customers on a calendar month basis. For example, the October bill for a transportation customer is for the actual sales that took place in September. Under this example, actual September meter reads would be used to calculate 4

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 4 the Credits B that will be refunded, by rate schedule, to customers on the October bill. This would be done by dividing the Credit B refund, by rate schedule, by the actual volumes for the corresponding rate schedule. This will result in a near exact refund of the Credit B for the transportation rate schedules. 5 6 7 8 9 10 11 12 Q. Has the Company included the transportation credits in proposed tariffs on Exhibit A- 3? A. No. The Company is not requesting approval of specific Credits B for the transportation rate schedules. Instead the Company is requesting approval of a total refund amount by transportation rate schedule and the methodology described above for calculating Credits B. If approved, the Company would submit transportation Credit B tariffs to the Commission prior to billing. 13 14 15 16 17 Q. What month is the Company proposing to implement the credits? A. The Company is proposing to implement the credits for October 2018. In the event that the credits are approved for a different month the Company should be allowed to recalculate the credits based on projected customer counts for the corresponding month. 18 19 20 21 22 23 24 25 Q. How does the Company propose to address any remaining residual balance that may result from the application of the credits on Exhibit A-3 if approved by the Commission? A. If a total residual balance exists that is less than $30,000, the amount shall be given to a charity chosen by the Company. If an over credit occurred that is less than $30,000, the over credit should be written off by the Company. If a residual balance exists resulting from an over credit that is greater than $30,000, surcharges will be calculated on a per customer 5

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 3 4 5 6 7 basis and applied during a subsequent month until the residual balance is less than $30,000. If an under credit occurred that is greater than $30,000, credits will be calculated on a per customer basis and applied during a subsequent month until the under credit is less than $30,000. However, if the residual balance is less than $30,000 and any one rate schedule is over or under credited by greater than $30,000, then additional surcharging or credits will be implemented for that particular rate schedule on a per customer basis, until the balance is less than $30,000 for that rate schedule 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q. As part of the directives made in the Commission s February 22, 2018 order issued in Case No. U-18494, 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-18238 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-18494. 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 30 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. U-18494 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, for purposes of complying with the Commission s February 22, 2018 order in Case No. U- 18494, the Company incorporates by reference, as if fully set out within this filing, its exhibits pre-filed in Case No. U-20115. 6

Direct Testimony of Steven Q. McLean On Behalf of SEMCO Energy Gas Company 1 2 Q. Does this conclude your direct testimony? 3 A. Yes. 7

SEMCO Energy Gas Company Case No.: U-20182 Calculation of Credit B Amount Witness: Steven Q. McLean Six months ended June 30, 2018 Exhibit A-1 Page 1 of 2 Credit A Amount Residential GS-1 GS-2 GS-3 TR-1 TR-2 TR-3 SC Total GCR DTH JAN (net of Dec 2017 unbilled) 1,414,385 309,883 176,620 135,533 2,036,421 FEB 4,200,966 814,801 617,051 806,154 6,438,972 MAR 3,862,487 746,922 590,839 829,410 6,029,658 APR 3,473,604 646,506 529,680 733,295 5,383,085 MAY 2,253,378 401,786 340,339 496,691 3,492,194 JUN 761,583 118,571 123,631 270,775 1,274,560 Total DTH - GCR 15,966,403 3,038,469 2,378,160 3,271,858 - - - 24,654,890 Approved Credit/Dth $ (0.1738) $ (0.1509) $ (0.1000) $ (0.0769) Total Credit B $ (2,774,961) $ (458,505) $ (237,816) $ (251,606) $ - $ - $ - $ (3,722,888) GCC DTH JAN (net of Dec 2017 unbilled) 107,005 42,263 18,364 20,776 188,408 FEB 312,850 104,229 76,603 101,293 594,975 MAR 279,230 93,757 69,882 105,968 548,837 APR 249,616 80,969 61,903 95,789 488,277 MAY 152,365 48,503 39,145 71,007 311,020 JUN 49,641 14,333 16,309 29,838 110,121 Total DTH - GCC 1,150,707 384,054 282,206 424,671 Approved Credit/Dth $ (0.1738) $ (0.1509) $ (0.1000) $ (0.0769) Total Credit B $ (199,993) $ (57,954) $ (28,221) $ (32,657) $ - $ - $ - $ (318,824) Transport DTH JAN 141 6,373 64,252 414,314 748,617 693,738 406,082 2,333,517 FEB 97 4,930 53,826 360,547 667,036 666,785 357,332 2,110,553 MAR 86 4,335 52,891 379,406 688,406 605,910 361,234 2,092,268 APR 51 3,062 42,259 332,046 610,307 563,027 319,033 1,869,785 MAY 545 16,032 197,434 463,134 526,105 286,068 1,489,318 Total DTH - Transport 375 19,245 229,260 1,683,747 3,177,500 3,055,565 1,729,749 9,895,441 Approved Credit/Dth $ (0.1509) $ (0.1000) $ (0.0769) $ (0.0470) $ (0.0421) $ (0.0318) $ - Total Credit B $ - $ (57) $ (1,925) $ (17,630) $ (79,136) $ (133,773) $ (97,167) $ - $ (329,687) Total Credit B - Credit A $ (2,974,954) $ (516,515) $ (267,961) $ (301,893) $ (79,136) $ (133,773) $ (97,167) $ - $ (4,371,399)

SEMCO Energy Gas Company Case No.: U-20182 Calculation of Credit B Amount Witness: Steven Q. McLean Six months ended June 30, 2018 Exhibit A-1 Page 2 of 2 MRP Amount Residential GS-1 GS-2 GS-3 TR-1 TR-2 TR-3 SC Total Meters GCR JAN 260,099 20,156 2,905 695 283,855 FEB 260,245 20,164 2,897 694 284,000 MAR 261,060 20,160 2,900 689 284,809 APR 261,518 20,165 2,895 686 285,264 MAY 261,809 20,160 2,900 687 285,556 JUNE 261,569 20,108 2,886 696 285,259 Total GCR meters 1,566,300 120,913 17,383 4,147 - - - - 1,708,743 Approved MRP Reduction $ (0.1100) $ (0.2500) $ (1.5600) $ (7.4200) $ (0.1100) $ (0.2500) $ (1.5600) $ (7.4200) Total MRP Credit B - GCR $ (172,293) $ (30,228) $ (27,117) $ (30,771) $ - $ - $ - $ - $ (260,409) Meters GCC JAN 20,840 2,150 401 99 23,490 FEB 20,696 2,139 399 98 23,332 MAR 20,275 2,117 395 98 22,885 APR 20,043 2,098 394 97 22,632 MAY 19,785 2,075 392 94 22,346 JUNE 19,463 2,080 399 85 22,027 Total GCC meters 121,102 12,659 2,380 571 - - - - 136,712 Approved MRP Reduction $ (0.1100) $ (0.2500) $ (1.5600) $ (7.4200) $ (0.1100) $ (0.2500) $ (1.5600) $ (7.4200) Total MRP Credit B - GCC $ (13,321) $ (3,165) $ (3,713) $ (4,237) $ - $ - $ - $ - $ (24,436) Meters Transport JAN 0 2 13 52 132 53 12 10 274 FEB 0 2 13 52 131 53 12 10 273 MAR 0 2 13 52 131 53 12 10 273 APR 0 2 13 52 131 53 12 10 273 MAY 0 2 13 52 131 53 12 10 273 Total Transport meters - 10 65 260 656 265 60 50 1,366 Approved MRP Reduction $ (0.2500) $ (1.5600) $ (7.4200) $ (20.5500) $ - $ - $ - Total MRP Credit B - Transport $ - $ (3) $ (101) $ (1,929) $ (13,481) $ - $ - $ - $ (15,514) - Total Credit B - MRPAmount $ (185,614) $ (33,396) $ (30,932) $ (36,937) $ (13,481) $ - $ - $ - $ (300,359) Total Credit B (Credit A+MRP) $ (3,160,568) $ (549,911) $ (298,893) $ (338,830) $ (92,617) $ (133,773) $ (97,167) $ - $ (4,671,758)

SEMCO Energy Gas Company Case No.: U-20182 Calculation of Credits B Witness: Steven Q. McLean Exhibit A-2 1 Page 1 of 1 Total Special Company Residential GS-1 GS-2 GS-3 TR-1 TR-2 TR-3 Contracts 1 Credit B Amount $ (4,671,758) $ (3,160,568) $ (549,911) $ (298,893) $ (338,830) $ (92,617) $ (133,773) $ (97,167) N/A 3 Projected Meters/Dth* (Oct.) 281,197 22,119 3,305 835 TDB TDB TDB N/A 4 Proposed Credits B $/Meter/Dth* ($11.24) ($24.86) ($90.44) ($405.78) TDB TBD TBD N/A * Credits B for transport customers will be on a $/Dth basis, caculated on actual sales

M.P.S.C. - No. 1 V Gas Case No.: U-20182 SEMCO ENERGY GAS COMPANY Witness: Steven Q. McLean (Credit B Case No. U-20182) Exhibit A-3 Page 1 of 2 Tax Cuts and Jobs Act Credit A X This credit is pursuant to the adjustment of the federal corporate tax rate on a going forward basis. This credit is to be on a volumetric basis. Tax Cuts and Jobs Act Credit A (Surcharge) Rate Class Amount Order No. Residential ($0.1738) per Dth U-20115 GS-1 ($0.1509) per Dth U-20115 GS-2 ($0.1000) per Dth U-20115 GS-3 ($0.0769) per Dth U-20115 Tax Cuts and Jobs Act Credit B X This credit is pursuant to the adjustment of the federal corporate tax rate and represents the tax credit from January 2018 through June 2018. This credit is to be on a per meter basis. Tax Cuts and Jobs Act Credit B (Surcharge) Rate Class Amount Order No. Residential ($11.24) per Meter U-20182 GS-1 ($24.86) per Meter U-20182 GS-2 ($90.44) per Meter U-20182 GS-3 ($405.78) per Meter U-20182 Issued, 2018 Effective for bills rendered on Colleen Starring and after, 2018. Issued under President authority of the Michigan Public Service Port Huron, MI Commission dated, 2018 in Case No. U-20182.

M.P.S.C. - No. 1 W Gas Case No.: U-20182 SEMCO ENERGY GAS COMPANY Witness: Steven Q. McLean (Credit B Case No. U-20182) Exhibit A-3 Page 2 of 2 Continued From Sheet No. E-1.00 Tax Cuts and Jobs Act Credit A W This credit is pursuant to the adjustment of the federal corporate tax rate on a going forward basis. This credit is to be on a volumetric basis. Tax Cuts and Jobs Act Credit A (Surcharge) Rate Class Amount/Dth Order No. TR-1 ($0.0470) per Dth U-20115 TR-2 ($0.0421) per Dth U-20115 TR-3 ($0.0318) per Dth U-20115 Tax Cuts and Jobs Act Credit B W This credit is pursuant to the adjustment of the federal corporate tax rate and represents the tax credit from January 2018 through June 2018. This credit is to be on a volumetric basis. Tax Cuts and Jobs Act Credit B (Surcharge) Rate Class Amount/Dth Order No. TR-1 ($X.XXXX) per Dth U-20182 TR-2 ($X.XXXX) per Dth U-20182 TR-3 ($X.XXXX) per Dth U-20182 Issued, 2018 Effective for bills rendered on Colleen Starring and after, 2018. Issued under President authority of the Michigan Public Service Port Huron, MI Commission dated, 2018 in Case No. U-20182.

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 1939 PA 3, as amended, and by 1933 PA 254, 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 (517) 2)'")$*0. $)'%-' #+.'" The #ommission will provide ')'&.,+*(& service of documents.* $(( +$,.'&- in this proceeding" THIS APPEARANCE TO BE ENTERED IN ASSOCIATION WITH THE ADMINISTRATIVE HEARING: Case / Company Name: SEMCO Energy Gas Company U-20182 Please enter my appearance in the above-entitled matter on behalf of: 1. (Name) SEMCO Energy Gas Company 2. (Name) 3. (Name) 4. (Name) 5. (Name) 6. (Name) 7. (Name) Docket No. Sherri A. Wellman Name MILLER, CANFIELD, PADDOCK AND STONE Address One Michigan Avenue, Suite 900 Lansing Michigan City State 48933 517 487-2070 Zip Phone ( ) wellmans@millercanfield.com Email July 27, 2018 Date " I am not an attorney " I am an attorney whose: 38989 Michigan Bar # is P- Bar # is: ( state ) Signature: EAHR1 - $*#&*#&$%(

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 rate-regulated ) electric, steam and natural gas utilities ) Case No. U-20182 to reflect the effects of the federal Tax ) Cuts and Jobs Act of 2017: ) SEMCO ENERGY GAS COMPANY ) files an application for determination of Credit B ) as described in orders U-18494 and U-20115. ) STATE OF MICHIGAN ) ) ss COUNTY OF INGHAM ) PROOF OF SERVICE Kimberly S. Fox, being first duly sworn, deposes and says that on July 27, 2018, she served a copy of the direct case on the persons listed below via electronic mail: Michael E. Moody Bryan A. Brandenburg Michael J. Brown moodym2@michigan.gov bbrandenburg@clarkhill.com mbrown@cebhlaw.com Kimberly S. Fox Subscribed and sworn before me on this 27 th day of July, 2018. Crystal L. Chacon, Notary Public State of Michigan, Ingham County My Commission Expires: May 25, 2024 Acting in Ingham County 31825256.1\129584-00108