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A CMS Energy Company August 2, 2018 Ms. Kavita Kale Executive Secretary Michigan Public Service Commission 7109 West Saginaw Highway Post Office Box 30221 Lansing, MI 48909 General Offices: LEGAL DEPARTMENT One Energy Plaza Jackson, MI 49201 Tel: Fax: (517) 788-0550 (517) 768-3644 CATHERINE M REYNOLDS Senior Vice President and General Counsel *Washington Office: 1730 Rhode Island Ave. N.W. Tel: (202) 778-3340 MELISSA M GLEESPEN Suite 1007 Vice President, Corporate Washington, DC 20036 Fax: (202) 778-3355 Secretary and Chief Compliance Officer Writer s Direct Dial Number: (517) 788-2112 Writer s E-mail Address: anne.uitvlugt@cmsenergy.com SHAUN M JOHNSON Vice President and Deputy General Counsel Bret A Totoraitis Kelly M Hall Eric V Luoma Assistant General Counsel Ashley L Bancroft Robert W Beach Don A D Amato Robert A. Farr Gary A Gensch, Jr. Gary L Kelterborn Chantez P Knowles Mary Jo Lawrie Jason M Milstone Rhonda M Morris Deborah A Moss* Mir e Michael Nestor Michael C. Rampe James D W Roush Scott J Sinkwitts Adam C Smith Theresa A G Staley Janae M Thayer Anne M Uitvlugt Aaron L Vorce Attorney RE: MPSC Case No. U-18424 In the Matter of the application of Consumers Energy Company for authority to increase its rates for the distribution of natural gas and for other relief. Dear Ms. Kale: Enclosed for electronic filing in the above-captioned proceeding, please find a Settlement Agreement which is intended to resolve all outstanding issues in this proceeding, except with respect to the issue of GCC-related bill messaging as set forth in paragraph 16 of the Settlement Agreement, and a Statement of Non-Objection. The Settlement Agreement has been executed by Consumers Energy Company, the Michigan Public Service Commission Staff, Michigan Attorney General Bill Schuette, Association of Business Advocating Tariff Equity, Retail Energy Supply Association, Lansing Board of Water & Light, and the Residential Customer Group. Also included is the Statement of Non-Objection of Midland Cogeneration Venture Limited Partnership This is a paperless filing and is therefore being filed only in PDF. I have enclosed a Proof of Service showing electronic service upon the parties. Sincerely, Digitally signed by Anne M. Uitvlugt Date: 2018.08.02 14:30:57-04'00' Anne M. Uitvlugt cc: Hon. Suzanne D. Sonneborn, Administrative Law Judge Parties per Attachment 1 to Proof of Service fl0818-1-225

, and XXLT

, and XXLT

or XXLT

The Company shall have the right to deny or shut off service in accordance with Rules and Regulations of the Company as authorized by the Michigan Public Service Commission outlined in Rule C1.3, Use of Service and in Rule C5.1, Access to Customer s Premises.

In the case of a lump sum default of payment, and after 180 days have passed, the account will automatically be set up as a fixed monthly surcharge payment.

9.25 %. U-18424 7.42

Rate XXLT 0 100,000 / Year 0.1438/Mcf NA > 100,000 / Year X.XXXX/Mcf 0.0018/Mcf, or XXLT

U-18424 July 2019 August June 2020 $0.36 customer 0.36 customer 0.55 customer 5.20 customer 29.80 customer NA 13.35/customer 20.66/customer 152.83/customer Rate XXLT NA NA 2,522.85/customer Per applicable distribution Rate Schedule

Extra Extremely Large, Cost-Based XXLT

Company selected may receive LIAC. The number of customers enrolled may be adjusted, at the Company s discretion, in order to dispense Commission-approved LIAC funding on an annual basis. Any shortfall in the dispensing of annual LIAC funds to qualified customers shall be carried over into the subsequent LIAC program year. LIAC customer selection will be based on highest need chosen from those with a significant medical condition, customers with lowest income and those with highest past-due balances, based on the following criteria: 1. Customers with an approved critical care certification where the total household income does not exceed 150% of the Federal Poverty level within the last 12 months, as verified by an authorized State or Federal agency. 2. Customers who have received a Home Heating Credit in the previous 12 months. Enrollment based on customers with highest arrears balance. 3. Customers whose total household income does not exceed 150% of the Federal Poverty level and have a past due balance. Enrollment based on customers with the highest arrears balance. Low Income Assistance Credit:, If a credit balance occurs, the credit shall apply to the customer s future gas utility charges. 3.0031

3.0031

85.40 480.23/ 40.00 80.00 2.5133 1.9517/ 1.4608 /

6.00 11.00

2.34 10% of the Annual Contract Quantity for ST, LT. and XLT, or exceeds 4% of the Annual Contract Quantity for XXLT,

, and XXLT 500.00 2,554.78 6.577.85 59,320.51 /meter 55.00 55.00 55.00 NA 70.00 /meter 1.0705 0.7932 0.6969 0.5394/Mcf, and the economic breakeven point between XLT and XXLT is 4,000,000 Mcf per year.

, and XXLT

, and XXLT. 4.0% $(0.0981)Per Mcf (0.0436) (0.0218) 0.0218 0.0436 and XXLT or XXLT

, and XXLT

S T A T E O F M I C H I G A N BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION In the matter of the application of ) CONSUMERS ENERGY COMPANY ) for authority to increase its rates for the ) Case No. U-18424 distribution of natural gas and for other relief ) ) STATE OF MICHIGAN ) ) SS COUNTY OF JACKSON ) PROOF OF SERVICE Samantha J. O Rourke, being first duly sworn, deposes and says that she is employed in the Legal Department of Consumers Energy Company; that on August 2, 2018, she served an electronic copy of the Settlement Agreement upon the persons listed in Attachment 1 hereto, at the e-mail addresses listed therein. She further states that she also served a hard copy of the same document to the Hon. Suzanne D. Sonneborn at the address listed in Attachment 1 by depositing the same in the United States mail in the City of Jackson, Michigan, with first-class postage thereon fully paid. Digitally signed by Samantha O'Rourke Date: 2018.08.02 14:31:36-04'00' Samantha J. O Rourke Subscribed and sworn to before me this 2 nd day of August, 2018. Digitally signed by Melissa K. Harris Date: 2018.08.02 14:31:59-04'00' Melissa K. Harris, Notary Public State of Michigan, County of Jackson My Commission Expires: 06/11/20 Acting in the County of Jackson ps0818-1-231

ATTACHMENT 1 TO CASE NO. U-18424 Administrative Law Judge Hon. Suzanne D. Sonneborn Administrative Law Judge 7109 West Saginaw Highway Post Office Box 30221 Lansing, MI 48909 E-Mail: sonneborns@michigan.gov Counsel for the Michigan Public Service Commission Staff Daniel E. Sonneveldt, Esq. Amit T. Singh, Esq. Monica M. Stephens, Esq. Assistant Attorneys General Public Service Division 7109 West Saginaw Highway Post Office Box 30221 Lansing, MI 48909 E-Mail: sonneveldtd@michigan.gov singha9@michigan.gov stephensm11@michigan.gov Michigan Public Service Commission Staff Gary Kitts Mike Byrne Bill Stosik Brian Ballinger Paul Proudfoot Bob Nichols Michigan Public Service Commission 7109 West Saginaw Highway Post Office Box 30221 Lansing, MI 48909 E-Mail: kittsg@michigan.gov byrnem@michigan.gov stosikb@michigan.gov ballingerb2@michigan.gov proudfootp@michigan.gov nicholsb1@michigan.gov Counsel for Attorney General, Bill Schuette Joel B. King, Esq. Celeste M. Gill, Esq. Assistant Attorneys General Special Litigation Unit 6 th Floor Williams Building Post Office Box 30755 Lansing, MI 48909 E-Mail: kingj38@michigan.gov gillc@michigan.gov AG-ENRA-Spec-Lit@michigan.gov Consultant for Attorney General Bill Schuette Sebastian Coppola, President Corporate Analytics 5928 Southgate Road Rochester, MI 48306 E-Mail: sebcoppola@corplytics.com Counsel for the Association of Businesses Advocating Tariff Equity ( ABATE ) Bryan A. Brandenburg, Esq. Michael J. Pattwell, Esq. Clark Hill PLC 212 East Grand River Avenue Lansing, MI 48906 E-Mail: bbrandenburg@clarkhill.com mpattwell@clarkhill.com Consultant for ABATE Jeffry C. Pollock Billie S. LaConte J. Pollock, Inc. 12647 Olive Boulevard, Suite 585 St. Louis, MO 63141 E-Mail: jcp@jpollockinc.com bsl@jpollockinc.com KAT@jpollockinc.com sl1117-1-229 Page 1 of 2

ATTACHMENT 1 TO CASE NO. U-18424 Counsel for Retail Energy Supply Association ( RESA ) Jennifer Utter Heston, Esq. Fraser Trebilcock Davis & Dunlap, P.C. 124 West Allegan, Suite 1000 Lansing, MI 48933 E-Mail: jheston@fraserlawfirm.com Counsel for the Lansing Board of Water & Light Jason T. Hanselman, Esq. Richard J. Aaron, Esq. Kyle M. Asher, Esq. Dykema Gossett, PLLC 201 Townsend Street, Suite 900 Lansing, MI 48933 E-Mail: jhanselman@dykema.com raaron@dykema.com kasher@dykema.com Counsel for Midland Cogeneration Venture Limited Partnership Jason T. Hanselman, Esq. Dykema Gossett PLLC 201 Townsend Street, Suite 900 Lansing, MI 48933 E-Mail: jhanselman@dykema.com Counsel for the Residential Customer Group Don L. Keskey, Esq. Brian W. Coyer, Esq. Public Law Resource Center PLLC 333 Albert Avenue, Suite 425 East Lansing, MI 48823 E-Mail: donkeskey@publiclawresourcecenter.com bwcoyer@publiclawresourcecenter.com sl1117-1-229 Page 2 of 2