Revenue

12 Months Ended

Dec. 31, 2020

Disaggregation of Revenue [Line Items]

Revenue

Revenue

Presented in the following tables are the components of operating revenue:

In Millions
Year Ended December 31, 2020	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,348		$	1,809		$	—		$	—		$	6,157
Other		—			—			81			—			81
Revenue recognized from contracts with customers		$	4,348		$	1,809		$	81		$	—		$	6,238
Leasing income		—			—			148			—			148
Financing income		11			6			—			262			279
Consumers alternative-revenue programs		29			14			—			—			43
Consumers revenues to be refunded		(16)			(12)			—			—			(28)
Total operating revenue – CMS Energy		$	4,372		$	1,817		$	229		$	262		$	6,680
Consumers
Consumers utility revenue
Residential		$	2,109		$	1,232								$	3,341
Commercial		1,444			337									1,781
Industrial		570			46									616
Other		225			194									419
Revenue recognized from contracts with customers		$	4,348		$	1,809								$	6,157
Financing income		11			6									17
Alternative-revenue programs		29			14									43
Revenues to be refunded		(16)			(12)									(28)
Total operating revenue – Consumers		$	4,372		$	1,817								$	6,189

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

In Millions
Year Ended December 31, 2019	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,407		$	1,922		$	—		$	—		$	6,329
Other		—			—			74			—			74
Revenue recognized from contracts with customers		$	4,407		$	1,922		$	74		$	—		$	6,403
Leasing income		—			—			174			—			174
Financing income		9			5			—			221			235
Consumers alternative-revenue programs		23			10			—			—			33
Total operating revenue – CMS Energy		$	4,439		$	1,937		$	248		$	221		$	6,845
Consumers
Consumers utility revenue
Residential		$	1,988		$	1,316								$	3,304
Commercial		1,502			372									1,874
Industrial		669			51									720
Other		248			183									431
Revenue recognized from contracts with customers		$	4,407		$	1,922								$	6,329
Financing income		9			5									14
Alternative-revenue programs		23			10									33
Total operating revenue – Consumers		$	4,439		$	1,937								$	6,376

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

In Millions
Year Ended December 31, 2018	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,528		$	1,882		$	—		$	—		$	6,410
Other		—			—			92			—			92
Revenue recognized from contracts with customers		$	4,528		$	1,882		$	92		$	—		$	6,502
Leasing income		—			—			160			—			160
Financing income		10			5			—			157			172
Consumers alternative-revenue programs		23			16			—			—			39
Total operating revenue – CMS Energy		$	4,561		$	1,903		$	252		$	157		$	6,873
Consumers
Consumers utility revenue
Residential		$	2,049		$	1,284								$	3,333
Commercial		1,545			367									1,912
Industrial		674			55									729
Other		260			176									436
Revenue recognized from contracts with customers		$	4,528		$	1,882								$	6,410
Financing income		10			5									15
Alternative-revenue programs		23			16									39
Total operating revenue – Consumers		$	4,561		$	1,903								$	6,464

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

Electric and Gas Utilities

Consumers Utility Revenue: Consumers recognizes revenue primarily from the sale of electric and gas utility services at tariff-based rates regulated by the MPSC. Consumers’ customer base consists of a mix of residential, commercial, and diversified industrial customers. Consumers’ tariff-based sales performance obligations are described below.

•Consumers has performance obligations for the service of standing ready to deliver electricity or natural gas to customers, and it satisfies these performance obligations over time. Consumers recognizes revenue at a fixed rate as it provides these services. These arrangements generally do not have fixed terms and remain in effect as long as the customer consumes the utility service. The rates are set by the MPSC through the rate-making process and represent the stand-alone selling price of Consumers’ service to stand ready to deliver.

•Consumers has performance obligations for the service of delivering the commodity of electricity or natural gas to customers, and it satisfies these performance obligations upon delivery. Consumers recognizes revenue at a price per unit of electricity or natural gas delivered, based on the tariffs established by the MPSC. These arrangements generally do not have fixed terms and remain in effect as long as the customer consumes the utility service. The rates are set by the MPSC through the rate-making process and represent the stand-alone selling price of a bundled product comprising the commodity, electricity or natural gas, and the service of delivering such commodity.

In some instances, Consumers has specific fixed-term contracts with large commercial and industrial customers to provide electricity or gas at certain tariff rates or to provide gas transportation services at contracted rates. The amount of electricity and gas to be delivered under these contracts and the associated future revenue to be received are generally dependent on the customers’ needs. Accordingly, Consumers recognizes revenues at the tariff or contracted rate as electricity or gas is delivered to the customer. Consumers also has other miscellaneous contracts with customers related to pole and other property rentals, appliance service plans, and utility contract work. Generally, these contracts are short term or evergreen in nature.

Accounts Receivable and Unbilled Revenues: Accounts receivable comprise trade receivables and unbilled receivables. CMS Energy and Consumers record their accounts receivable at cost less an allowance for uncollectible accounts. The allowance is increased for uncollectible accounts expense and decreased for account write-offs net of recoveries. CMS Energy and Consumers establish the allowance based on historical losses, management’s assessment of existing economic conditions, customer payment trends, and reasonable and supported forecast information. CMS Energy and Consumers assess late payment fees on trade receivables based on contractual past-due terms established with customers. Accounts are written off when deemed uncollectible, which is generally when they become six months past due.

CMS Energy and Consumers recorded uncollectible accounts expense of $33 million for the year ended December 31, 2020, and $29 million for the years ended December 31, 2019 and 2018. At December 31, 2020, Consumers had deferred $4 million of uncollectible accounts expense as a non-current regulatory asset. For additional information, see Note 3, Regulatory Matters.

Consumers’ customers are billed monthly in cycles having billing dates that do not generally coincide with the end of a calendar month. This results in customers having received electricity or natural gas that they have not been billed for as of the month-end. Consumers estimates its unbilled revenues by applying an average billed rate to total unbilled deliveries for each customer class. Unbilled revenues, which are recorded as accounts receivable and accrued revenue on CMS Energy’s and Consumers’ consolidated balance sheets, were $437 million at December 31, 2020 and $426 million at December 31, 2019.

Alternative‑Revenue Programs: Consumers accounts for its energy waste reduction incentive mechanism and financial compensation mechanism as alternative-revenue programs. Consumers recognizes revenue related to the energy waste reduction incentive as soon as energy savings exceed the annual targets established by the MPSC and recognizes revenue related to the financial compensation mechanism as payments are made on MPSC-approved PPAs. For additional information on these mechanisms, see Note 3, Regulatory Matters.

Consumers does not reclassify revenue from its alternative-revenue program to revenue from contracts with customers at the time the amounts are collected from customers.

Revenues to Be Refunded: In December 2020, the MPSC issued an order authorizing Consumers to refund $28 million voluntarily to utility customers. For additional information, see Note 3, Regulatory Matters.

Consumers Energy Company

Disaggregation of Revenue [Line Items]

Revenue

Revenue

Presented in the following tables are the components of operating revenue:

In Millions
Year Ended December 31, 2020	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,348		$	1,809		$	—		$	—		$	6,157
Other		—			—			81			—			81
Revenue recognized from contracts with customers		$	4,348		$	1,809		$	81		$	—		$	6,238
Leasing income		—			—			148			—			148
Financing income		11			6			—			262			279
Consumers alternative-revenue programs		29			14			—			—			43
Consumers revenues to be refunded		(16)			(12)			—			—			(28)
Total operating revenue – CMS Energy		$	4,372		$	1,817		$	229		$	262		$	6,680
Consumers
Consumers utility revenue
Residential		$	2,109		$	1,232								$	3,341
Commercial		1,444			337									1,781
Industrial		570			46									616
Other		225			194									419
Revenue recognized from contracts with customers		$	4,348		$	1,809								$	6,157
Financing income		11			6									17
Alternative-revenue programs		29			14									43
Revenues to be refunded		(16)			(12)									(28)
Total operating revenue – Consumers		$	4,372		$	1,817								$	6,189

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

In Millions
Year Ended December 31, 2019	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,407		$	1,922		$	—		$	—		$	6,329
Other		—			—			74			—			74
Revenue recognized from contracts with customers		$	4,407		$	1,922		$	74		$	—		$	6,403
Leasing income		—			—			174			—			174
Financing income		9			5			—			221			235
Consumers alternative-revenue programs		23			10			—			—			33
Total operating revenue – CMS Energy		$	4,439		$	1,937		$	248		$	221		$	6,845
Consumers
Consumers utility revenue
Residential		$	1,988		$	1,316								$	3,304
Commercial		1,502			372									1,874
Industrial		669			51									720
Other		248			183									431
Revenue recognized from contracts with customers		$	4,407		$	1,922								$	6,329
Financing income		9			5									14
Alternative-revenue programs		23			10									33
Total operating revenue – Consumers		$	4,439		$	1,937								$	6,376

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

In Millions
Year Ended December 31, 2018	Electric Utility			Gas Utility			Enterprises1			EnerBank			Consolidated
CMS Energy, including Consumers
Consumers utility revenue		$	4,528		$	1,882		$	—		$	—		$	6,410
Other		—			—			92			—			92
Revenue recognized from contracts with customers		$	4,528		$	1,882		$	92		$	—		$	6,502
Leasing income		—			—			160			—			160
Financing income		10			5			—			157			172
Consumers alternative-revenue programs		23			16			—			—			39
Total operating revenue – CMS Energy		$	4,561		$	1,903		$	252		$	157		$	6,873
Consumers
Consumers utility revenue
Residential		$	2,049		$	1,284								$	3,333
Commercial		1,545			367									1,912
Industrial		674			55									729
Other		260			176									436
Revenue recognized from contracts with customers		$	4,528		$	1,882								$	6,410
Financing income		10			5									15
Alternative-revenue programs		23			16									39
Total operating revenue – Consumers		$	4,561		$	1,903								$	6,464

1Amounts represent the enterprises segment’s operating revenue from independent power production and its sales of energy commodities.

Electric and Gas Utilities

Consumers Utility Revenue: Consumers recognizes revenue primarily from the sale of electric and gas utility services at tariff-based rates regulated by the MPSC. Consumers’ customer base consists of a mix of residential, commercial, and diversified industrial customers. Consumers’ tariff-based sales performance obligations are described below.

•Consumers has performance obligations for the service of standing ready to deliver electricity or natural gas to customers, and it satisfies these performance obligations over time. Consumers recognizes revenue at a fixed rate as it provides these services. These arrangements generally do not have fixed terms and remain in effect as long as the customer consumes the utility service. The rates are set by the MPSC through the rate-making process and represent the stand-alone selling price of Consumers’ service to stand ready to deliver.

•Consumers has performance obligations for the service of delivering the commodity of electricity or natural gas to customers, and it satisfies these performance obligations upon delivery. Consumers recognizes revenue at a price per unit of electricity or natural gas delivered, based on the tariffs established by the MPSC. These arrangements generally do not have fixed terms and remain in effect as long as the customer consumes the utility service. The rates are set by the MPSC through the rate-making process and represent the stand-alone selling price of a bundled product comprising the commodity, electricity or natural gas, and the service of delivering such commodity.

In some instances, Consumers has specific fixed-term contracts with large commercial and industrial customers to provide electricity or gas at certain tariff rates or to provide gas transportation services at contracted rates. The amount of electricity and gas to be delivered under these contracts and the associated future revenue to be received are generally dependent on the customers’ needs. Accordingly, Consumers recognizes revenues at the tariff or contracted rate as electricity or gas is delivered to the customer. Consumers also has other miscellaneous contracts with customers related to pole and other property rentals, appliance service plans, and utility contract work. Generally, these contracts are short term or evergreen in nature.

Accounts Receivable and Unbilled Revenues: Accounts receivable comprise trade receivables and unbilled receivables. CMS Energy and Consumers record their accounts receivable at cost less an allowance for uncollectible accounts. The allowance is increased for uncollectible accounts expense and decreased for account write-offs net of recoveries. CMS Energy and Consumers establish the allowance based on historical losses, management’s assessment of existing economic conditions, customer payment trends, and reasonable and supported forecast information. CMS Energy and Consumers assess late payment fees on trade receivables based on contractual past-due terms established with customers. Accounts are written off when deemed uncollectible, which is generally when they become six months past due.

CMS Energy and Consumers recorded uncollectible accounts expense of $33 million for the year ended December 31, 2020, and $29 million for the years ended December 31, 2019 and 2018. At December 31, 2020, Consumers had deferred $4 million of uncollectible accounts expense as a non-current regulatory asset. For additional information, see Note 3, Regulatory Matters.

Consumers’ customers are billed monthly in cycles having billing dates that do not generally coincide with the end of a calendar month. This results in customers having received electricity or natural gas that they have not been billed for as of the month-end. Consumers estimates its unbilled revenues by applying an average billed rate to total unbilled deliveries for each customer class. Unbilled revenues, which are recorded as accounts receivable and accrued revenue on CMS Energy’s and Consumers’ consolidated balance sheets, were $437 million at December 31, 2020 and $426 million at December 31, 2019.

Alternative‑Revenue Programs: Consumers accounts for its energy waste reduction incentive mechanism and financial compensation mechanism as alternative-revenue programs. Consumers recognizes revenue related to the energy waste reduction incentive as soon as energy savings exceed the annual targets established by the MPSC and recognizes revenue related to the financial compensation mechanism as payments are made on MPSC-approved PPAs. For additional information on these mechanisms, see Note 3, Regulatory Matters.

Consumers does not reclassify revenue from its alternative-revenue program to revenue from contracts with customers at the time the amounts are collected from customers.

Revenues to Be Refunded: In December 2020, the MPSC issued an order authorizing Consumers to refund $28 million voluntarily to utility customers. For additional information, see Note 3, Regulatory Matters.