Related Party Transactions - Consumers (Consumers Energy Company [Member])

12 Months Ended

Dec. 31, 2014

Consumers Energy Company [Member]

Related Party Transactions - Consumers

18:RELATED-PARTY TRANSACTIONS – CONSUMERS

Consumers enters into a number of significant transactions with related parties.  These transactions include:

· purchase of electricity from affiliates of CMS Enterprises;

· payment of parent company overhead costs to CMS Energy; and

· investment in CMS Energy common stock.

Transactions involving power supply purchases from certain affiliates of CMS Enterprises are based on avoided costs under the Public Utility Regulatory Policies Act of 1978, state law, and competitive bidding.  The payment of parent company overhead costs is based on the use of accepted industry allocation methodologies.  These payments are for costs that occur in the normal course of business.

Presented in the following table is Consumers’ expense recorded from related party transactions for the years ended December 31:

In Millions
Description	Related Party	2014			2013			2012
Purchases of capacity and energy	Affiliates of CMS Enterprises		$	89		$	89		$	86

Amounts payable to related parties for purchased power and other services were $12 million at December 31, 2014 and $13 million at December 31, 2013.

Consumers owned 1.1million shares of CMS Energy common stock with a fair value of $38million at December 31, 2014.  For additional details on Consumers’ investment in CMS Energy common stock, see Note 7, Financial Instruments.

In September 2014, Consumers entered into three transactions with CMSERM for the purchase of capacity for future years.  The purchases, which were the result of competitive bidding, total $3 million.

In November 2014, Consumers renewed a short-term credit agreement with CMS Energy, permitting Consumers to borrow up to $300 million.  At December 31, 2014, there were no outstanding loans under the agreement.