LANSING – The Public Service Commission released the second of four draft reports Tuesday on renewable energy before Governor Rick Snyder’s recommendations on the state’s energy future, expected in December.

The report consists of miscellaneous energy questions that were not classified specifically to renewable energy, energy efficiency or electric choice. The questions include electric liability, natural gas and electricity rates.

The report said ITC, the largest transmission company in the state, has made more than $2 billion in capital investments in transmission infrastructure in the Lower Peninsula, and the region is ranked in the top 10 in the industry for reliability.

The American Transmission Company is responsible for the transmission system in the Upper Peninsula and has taken steps to improve infrastructure, and in turn improve reliability in the region, the report said.

The report said the state’s electricity rates were above the national average during the 1990s, below the national average during the 2000s, and currently are higher than the national average.

Load loss appears to have had the largest impact on rates, the report said. When customers leave a utility service to switch to an alternative electric supplier or leave the system entirely, there are fewer customers and lower sales over which to spread the fixed costs of a utility, and then leads to higher rates for those customers who remain with utility service.

Fuel costs have had the second largest impact on rates since 2008, the report said. The state’s total coal costs increased 96 percent from 2004 to 2012, yet were in line with neighboring Great Lakes states during this time. Reasons cited include transportation costs, production costs and increased coal exports.

The report also said that although the state has higher electricity costs, residents use less electricity, which leads to lower utility bills.

Currently the state producers supply 15 to 20 percent of natural gas used in the state, while also receiving natural gas from Texas, Oklahoma, Louisiana and Canada, the report said. Hydraulic fracturing is required to affordably access the state’s potential, the report said.

The state also has the capability to store 649 billion cubic feet of natural gas, and there could be more room if depleted reservoirs were utilized. Currently, there is sufficient in-state pipeline capacity to move natural gas around the state and to satisfy demand as a whole.

And, the relatively low price of gas and the increase in shale production provides increased incentive to use gas for applications other than heating. Specifically, the state is experiencing a compliance push to retire and replace coal-fired electric generation with natural gas-fired generation, mainly due to environmental regulations and the price of natural gas, the report said.

Public comments can be made on the report until October 22.

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