<PAGE>

                                   FORM 10-K
                United States Securities and Exchange Commission
                             Washington, D.C. 20549

                        FOR ANNUAL AND TRANSITION REPORTS
                      PURSUANT TO SECTIONS 13 OR 15d OF THE
                         SECURITIES EXCHANGE ACT OF 1934

            THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL
    INSTRUCTIONS I (1) (a) AND (b) OF FORM 10-K AND IS THEREFORE FILING THIS
                    FORM WITH THE REDUCED DISCLOSURE FORMAT.

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
      For the year ended December 31, 2001

                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
      For the transition period from __________ to __________


Commission File      Registrant; State of Incorporation;        IRS Employer
     Number           Address and Telephone Number            Identification No.
---------------      -----------------------------------      ------------------
333-47938            Consumers Funding LLC                      38-3575109
                     (A Delaware Corporation)
                     212 W. Michigan
                     Jackson, Michigan 49201
                     (517) 788-0250

Securities registered pursuant to Section 12 (b) of the Act:  None.

Securities registered pursuant to Section 12 (g) of the Act:  None.

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES [X] NO [ ]

The aggregate market value of the voting and non-voting common equity held by
non-affiliates of the Registrant: None.

                      Documents incorporated by reference:

Not applicable.




<PAGE>
                             CONSUMERS FUNDING, LLC
                           FORM 10-K ANNUAL REPORT TO
                     THE SECURITIES AND EXCHANGE COMMISSION
                      FOR THE YEAR ENDED DECEMBER 31, 2001


                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                         Page
                                                                                                         ----
<S>                                                                                                      <C>
PART I:

1.   Business............................................................................................  3
2.   Properties..........................................................................................  4
3.   Legal Proceedings...................................................................................  4
4.   Submission of Matters to a Vote of Security Holders.................................................  4

PART II:

5.   Market for the Registrant's Common Equity and Related Stockholder Matters...........................  4
6.   Selected Financial Data.............................................................................  5
7.   Management's Narrative and Analysis of Results of Operations........................................  5
7A.  Quantitative and Qualitative Disclosures About Market Risk..........................................  6
     Report of Independent Accountants...................................................................  7
8.   Financial Statements and Supplementary Data
         Statement of Income.............................................................................  8
         Balance Sheet...................................................................................  9
         Statement of Cash Flows......................................................................... 10
         Statement of Member's Equity.................................................................... 11
         Notes to Financial Statements................................................................... 12
9.   Changes in and Disagreements with Accountants on Accounting and Financial
     Disclosure.......................................................................................... 17

PART III:

10.  Directors and Executive Officers of the Registrant.................................................. 17
11.  Executive Compensation.............................................................................. 17
12.  Security Ownership of Certain Beneficial Owners and Management...................................... 17
13.  Certain relationships and Related Transactions...................................................... 17

PART IV:

14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K..................................... 18
     Signatures.......................................................................................... 19
     Exhibit Index....................................................................................... 20
     Exhibit 99.......................................................................................... 21
</TABLE>


                                  Page 2 of 21

<PAGE>

                                     PART I

                                ITEM 1. BUSINESS

GENERAL

On October 11, 2000, Consumers Funding LLC ("Consumers Funding") whose sole
member is Consumers Energy Company ("Consumers Energy"), was formed as a
Delaware limited liability company pursuant to a limited liability company
agreement executed by Consumers Energy. Consumers Energy is an electric and gas
utility company and is a wholly owned subsidiary of CMS Energy Corporation.

Consumers Funding was organized for the sole purposes of:

         -        Purchasing and owning securitization property;

         -        Issuing one or more series of securitization bonds;

         -        Pledging its interest in securitization property and other
                  collateral to the trustee under the indenture in order to
                  secure securitization bonds; and

         -        Performing activities that are necessary, suitable or
                  convenient to accomplish these purposes, including the
                  execution of any interest rate swap agreement or hedging
                  arrangement incident to the issuance of securitization bonds.

Consumers Funding is not authorized to and will not engage in any activities in
the nature of selling electricity.

Consumers Funding's assets are limited to the securitization property that was
sold to the issuer, the trust funds held by the trustee, the rights of the
issuer under the transaction documents, any third party credit enhancement or
rights under any interest rate swap agreement and any money distributed to the
issuer from the collection account in accordance with the indenture and not
distributed to Consumers Energy.

The securitization property represents the irrevocable right to recover an
amount sufficient to recover a portion of Consumers Energy's qualified costs,
including an amount sufficient to pay the principal of and interest on the
series 2001-1 securitization bonds issued by Consumer Funding in November 2001
and the expenses associated with the securitization bonds. This amount is to be
recovered through a non-bypassable securitization charge, approved by the
Michigan Public Service Commission ("MPSC"), payable by all of Consumers
Energy's electric customers taking deliver from Consumers Energy or its
successor on its MPSC approved rate schedules and under certain special
contracts with specific customers.

The securitization bonds represent obligations only of Consumers Funding, and
are backed only by the assets of the Consumers Funding. The securitization bonds
do not represent obligations of Consumers Energy or of any agency or
instrumentality of the State of Michigan.

The only material business conducted by Consumers Funding has been the issuance
of the securitization bonds and holding of the securitization property.


                                  Page 3 of 21

<PAGE>

Consumers Funding has no employees. Under the Servicing Agreement, Consumers
Energy, as agent for Consumers Funding, has the following duties:

         (i)      obtaining meter reads, calculating and billing the
                  securitization charges and collecting from customers all
                  securitization charge collections;

         (ii)     responding to inquiries by customers, alternative electric
                  Suppliers, if any, the MPSC, or any federal, local or other
                  state governmental authority with respect to the
                  securitization charges;

         (iii)    delivering bills or arranging for delivery of bills,
                  accounting for securitization charge collections,
                  investigating and resolving delinquencies, processing and
                  depositing collections, making periodic remittances and
                  furnishing periodic reports to the Issuer, the Trustee, the
                  securitization bondholders, the Securities and Exchange
                  Commission and the rating agencies, subject, in the case of
                  processing and depositing collections, making periodic
                  remittances and furnishing periodic reports, to the provisions
                  of the Intercreditor Agreement;

         (iv)     settling, as the agent for the Issuer, as its interest may
                  appear, defaulted or written off accounts in accordance with
                  the Servicer's usual and customary practices for accounts of
                  its own electric service customers; and

         (v)      taking action in connection with securitization charge
                  adjustments (see MANAGEMENT'S NARRATIVE ANALYSIS).


                               ITEM 2. PROPERTIES

Consumers Funding has no physical property. Its primary asset is the
securitization property described in Item 1 above.

                            ITEM 3. LEGAL PROCEEDINGS

None.

           ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Omitted pursuant to Instruction I of Form 10-K.



                                     PART II

                  ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
                         AND RELATED STOCKHOLDER MATTERS

(a)      Sales of Unregistered Securities. There is no established public
         trading market for Consumers Funding's equity securities. Consumers
         Energy owns all of the Company's equity. On January 22, 2001, Consumers
         Energy made a $1,000 equity contribution to Consumers


                                  Page 4 of 21

<PAGE>

(b)      Funding. On November 8, 2001, Consumers Energy made a $2.3 million
         equity investment in Consumers Funding.

(c)      Restriction on Dividend. Consumers Funding may not make any payment,
         distributions or dividends to any member of Consumers Funding with
         respect to its membership interest in Consumers Energy except in
         accordance with the Indenture.

(d)      Bondholder. As of December 31, 2001, the sole holder of the
         Securitization Bonds was Cede & Company, as nominee of the Depository
         Trust. The Securitization Bonds are not registered on any national
         securities exchange and are not traded on any established trading
         market.


                         ITEM 6. SELECTED FINANCIAL DATA

Omitted pursuant to Instruction I of Form 10-K.


                     ITEM 7. MANAGEMENT'S NARRATIVE ANALYSIS
                             OF RESULTS OF OPERATION

This Management's Narrative Analysis (MNA) of the results of operation of
Consumers Funding is an abbreviated format pursuant to Instruction I of Form
10-K. The MNA refers to, and in some sections specifically incorporates by
reference, Consumers Funding's Notes to Financial Statements and should be read
in conjunction with such Financial Statements and Notes.

This Annual Report and other written and oral statements from Consumers Funding
may contain forward-looking statements as defined by the Private Securities
Litigation Reform Act of 1995. Consumers Funding's intentions with the use of
the words "anticipates," "believes," "estimates," "expects," "intends," and
"plans," and variations of such words and similar expressions, are solely to
identify forward-looking statements that involve risk and uncertainty. These
forward-looking statements are subject to various factors that could cause
Consumers Funding's actual results to differ materially from the results
anticipated in such statements. Consumers Funding has no obligation to update or
revise forward-looking statements regardless of whether new information, future
events or any other factors affect the information contained in such statements.
Consumers Funding does, however, discuss certain risk factors, uncertainties and
assumptions in this MNA, and in various public filings it periodically makes
with the Securities and Exchange Commission. Consumers Funding designed this
discussion of potential risks and uncertainties, which is by no means
comprehensive, to highlight important factors that may impact Consumers
Funding's outlook.

As discussed above under Item 1. BUSINESS, Consumers Funding, a Delaware limited
liability company whose sole member is Consumers Energy, was formed by
Consumers Energy on October 11, 2000. Consumers Energy is an electric and gas
utility and is a wholly owned subsidiary of CMS Energy Corporation. Consumers
Funding was organized for the sole purpose of purchasing and owning
securitization property (see below), issuing securitization bonds, pledging its
interest in securitization property and other collateral to the trustee to
collateralize the securitization bonds, and performing activities that are
necessary, suitable or convenient to accomplish these purposes.


                                  Page 5 of 21

<PAGE>
 On November 8, 2001, Consumers Funding issued $468.6 million of securitization
bonds. The proceeds from the securitization bond issuance were used to purchase
securitization property from Consumers Energy. As discussed in Note 1 to the
Financial Statements, securitization property represents the irrevocable right
of Consumers Energy to collect a non-bypassable securitization charge from
customers in accordance with a financing order issued by the MPSC. The
securitization property, which is classified as a securitization receivable,
resulted in the recording of $3.4 million of interest income for the year ended
December 31, 2001. This interest income was offset by the recording of $3.4
million of interest expense associated with the securitization bonds.

Consumers Energy, as servicer, began billing a securitization charge to electric
customers beginning with its December 2001 billing cycle. The surcharge
currently totals $.001427 per kilowatt-hour. In the servicing agreement between
Consumers Funding and Consumers Energy, Consumers Energy is required to remit
its securitization charge collections to the trustee on each business day.
Through December 31, 2001, Consumers Energy had remitted approximately $1.3
million of securitization charge collections to the trustee. Consumers Funding
expects that there will be sufficient cash remitted to the trustee for the first
payment of approximately $25.4 million for securitization bond principal,
interest and related expenses due on July 20, 2002.

Under the servicing agreement, Consumers Energy is required to request periodic
securitization charge adjustments from the MPSC. The request for an adjustment
must be submitted at least 45 days before the adjustment may take place.
Adjustments will be made annually, and then quarterly beginning approximately
one year before the expected final payment date of the last maturing class of
securitization bonds. Adjustments to the securitization charge are based, among
other things, on actual securitization charge revenue collections and updated
assumptions by Consumers Energy as to projected future deliveries of electricity
to customers.



         ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

None.



                                  Page 6 of 21

<PAGE>
                        Report of Independent Accountants

We have audited the accompanying balance sheet of CONSUMERS FUNDING LLC (a
Delaware limited liability corporation and wholly owned subsidiary of Consumers
Energy) as of December 31, 2001, and the related statements of income, cash
flows, and member's equity for the year ended December 31, 2001. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statements based on our
audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Consumers Funding as of
December 31, 2001, and the results of its operations and its cash flows for the
year ended December 31, 2001, in conformity with accounting principles generally
accepted in the United States.

/s/ Arthur Andersen LLP

Detroit, Michigan,
March 14, 2002.





                                  Page 7 of 21

<PAGE>

               ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                              CONSUMERS FUNDING LLC
                               STATEMENT OF INCOME
                             (THOUSANDS OF DOLLARS)


<TABLE>
<CAPTION>
                                                                  YEAR ENDED
                                                              DECEMBER 31, 2001
                                                              -----------------
<S>      <C>                                                  <C>
OPERATING REVENUES

         Interest Income -- Consumers Energy                       $3,389
         Other Operating Revenue -- Consumers Energy                  129
                                                                   ------

         Total Operating Revenue                                    3,518

OPERATING EXPENSES

         Interest Expense                                           3,389
         Administrative Fee -- Consumers Energy                        12
         Service Fee -- Consumers Energy                              117
                                                                   ------

         Total Operating Expenses                                   3,518
                                                                   ------


OPERATING INCOME                                                        0
                                                                   ------



NET INCOME                                                         $    0
                                                                   ======
</TABLE>

The accompanying notes are an integral part of this statement.




                                  Page 8 of 21

<PAGE>
                              CONSUMERS FUNDING LLC
                                  BALANCE SHEET
                             (THOUSANDS OF DOLLARS)

<TABLE>
<CAPTION>
ASSETS                                                           DECEMBER 31, 2001
                                                                 -----------------
<S>      <C>                                                     <C>
CURRENT ASSETS

         Restricted Cash                                             $  3,604
         Securitization Receivable -- Consumers Energy                 15,650
         Interest Receivable -- Consumers Energy                        2,257
                                                                     --------

         Total Current Assets                                          21,511
                                                                     --------

NON-CURRENT ASSETS

         Securitization Receivable -- Consumers Energy                452,942
                                                                     --------

         Total Non-Current Assets                                     452,942
                                                                     --------

TOTAL ASSETS                                                         $474,453
                                                                     ========

LIABILITIES AND MEMBER'S EQUITY

CURRENT LIABILITIES

         Securitization Bonds Payable                                $ 15,650
         Accounts Payable                                                 129
         Interest Payable                                               3,389
                                                                     --------

         Total Current Liabilities                                     19,168
                                                                     --------

NON-CURRENT LIABILITIES

         Securitization Bonds Payable                                 452,942
                                                                     --------

         Total Non-Current Liabilities                                452,942
                                                                     --------

MEMBER'S EQUITY                                                         2,343
                                                                     --------

TOTAL LIABILITIES AND MEMBER'S EQUITY                                $474,453
                                                                     ========
</TABLE>


The accompanying notes are an integral part of this Balance Sheet.



                                  Page 9 of 21
<PAGE>
                              CONSUMERS FUNDING LLC
                             STATEMENT OF CASH FLOWS
                             (THOUSANDS OF DOLLARS)

<TABLE>
<CAPTION>
                                                                  YEAR ENDED
                                                               DECEMBER 31, 2001
                                                               -----------------
<S>      <C>                                                   <C>
OPERATING ACTIVITIES

         Net Income                                              $       0
                                                                 ---------

   Changes in Current Assets and Liabilities:
         Interest Receivable -- Consumers Energy                    (2,257)
         Interest Payable                                            3,389
         Accounts Payable -- Consumers Energy                          129
                                                                 ---------

   NET CASH FROM OPERATING ACTIVITIES                                1,261
                                                                 ---------

INVESTING ACTIVITIES

         Purchase of Securitization Property                      (468,592)
                                                                 ---------

   NET CASH USED FOR INVESTING ACTIVITIES                         (468,592)
                                                                 ---------


FINANCING ACTIVITIES

         Issuance of Bonds                                         468,592
         Member's Investment                                         2,343
                                                                 ---------

   NET CASH FROM FINANCING ACTIVITIES                              470,935
                                                                 ---------


NET INCREASE IN CASH AND CASH EQUIVALENTS                            3,604

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR                       0
                                                                 ---------


CASH AND CASH EQUIVALENTS AT END OF THE YEAR                     $   3,604
                                                                 =========

OTHER CASH ACTIVITIES:

         Interest Paid                                           $       0
                                                                 =========
</TABLE>

The accompanying notes are an integral part of this statement.


                                 Page 10 of 21

<PAGE>

                              CONSUMERS FUNDING LLC
                          STATEMENT OF MEMBER'S EQUITY
                             (THOUSANDS OF DOLLARS)

<TABLE>
<CAPTION>
                                                              YEAR ENDED
                                                           DECEMBER 31, 2001
                                                           -----------------
<S>      <C>                                               <C>
BEGINNING BALANCE                                          $              0

ADD:
         Member's Investment                                          2,343
                                                           ----------------


BALANCE AT DECEMBER 31, 2001                               $          2,343
                                                           ================
</TABLE>


The accompanying notes are an integral part of this statement.




                                 Page 11 of 21

<PAGE>
                              CONSUMERS FUNDING LLC

                          NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND NATURE OF OPERATIONS

Consumers Funding LLC ("Consumers Funding"), a Delaware limited liability
company whose sole member is Consumers Energy Company ("Consumers Energy"), was
formed by Consumers Energy on October 11, 2000, and on January 22, 2001,
Consumers Energy completed a $1,000 equity contribution to Consumers Funding.
Consumers Energy is an electric and gas utility company and is a wholly owned
subsidiary of CMS Energy Corporation. Consumers Funding was organized for the
sole purpose of purchasing and owning securitization property (see below),
issuing securitization bonds, pledging its interest in securitization property
and other collateral to the trustee to collateralize the securitization bonds,
and performing activities that are necessary, suitable or convenient to
accomplish these purposes.

Securitization property represents the irrevocable right of Consumers Energy, or
its successor or assignee, to collect a nonbypassable securitization charge
(Securitization Charge) from customers in accordance with a financing order
(MPSC Financing Order) issued by the Michigan Public Service Commission (MPSC)
on October 24, 2000. As modified by rehearing on January 4, 2001, the MPSC
Financing Order authorizes the Securitization Charge to be sufficient to recover
$468.6 million aggregate principal amount of securitization bonds, plus an
amount sufficient to provide for any credit enhancement, to fund any reserves
and to pay interest, redemption premiums, if any, servicing fees and other
expenses relating to the securitization bonds. For financial reporting purposes,
the purchase of the securitization property has been accounted for as a
financing in the amount of $468.6 million. Accordingly, Consumers Funding has
classified the purchase of securitization property as a securitization
receivable from Consumers Energy in the financial statements.

Consumers Funding's organizational documents require it to operate in a manner
so that it would not be consolidated into the bankruptcy estate of Consumers
Energy in the event Consumers Energy becomes subject to a bankruptcy proceeding.
Both Consumers Energy and Consumers Funding will treat the transfer of the
securitization property to Consumers Funding as a true sale under applicable law
for bankruptcy purposes. The securitization bonds are treated as debt
obligations of Consumers Funding. For financial reporting, Federal income tax
and State of Michigan income and franchise tax purposes, the transfer of
securitization property to Consumers Funding is treated as part of a financing
arrangement and not as a sale. Furthermore, the results of operations of
Consumers Funding are consolidated with Consumers Energy for financial and
income tax reporting purposes.

Consumers Funding is legally separate from Consumers Energy. The assets and
income of Consumers Funding, including without limitation the securitization
property, are not available to creditors of Consumers Energy or CMS Energy
Corporation.

On November 8, 2001, Consumers Funding issued $468.6 million of securitization
bonds, Series 2001-1, in six different classes. The proceeds were used to fund
the purchase of securitization property from Consumers Energy. The principal
amount of the securitization bonds, interest, fees and required
overcollateralization for the securitization bonds, will be recovered through
securitization charges collected from electric retail customers taking delivery
of electricity from Consumers Energy or its successor based on MPSC approved
rate schedules and as permitted by contracts between Consumers Energy and
certain specific customers.


                                 Page 12 of 21

<PAGE>





Consumers Energy, as servicer, collects securitization charges from its
customers and deposits collections daily into the General Subaccount held by the
trustee (The Bank of New York). The trustee is required to use these funds to
make principal and interest payments on the securitization bonds and to pay
certain fees and expenses of Consumers Funding.

Consumers Funding has no employees. Under the servicing agreement with Consumers
Energy, Consumers Energy is required to manage and administer the securitization
property and to collect securitization charges on behalf of Consumers Funding.
Consumers Energy receives a monthly servicing fee of one-twelfth times 0.25
percent of the principal amount of securitization bonds outstanding as of the
payment date. The servicing agreement also requires Consumers Energy to file
annual securitization charge adjustment requests with the MPSC. These
securitization charge adjustment requests will be based on actual securitization
charge revenue collections and updated assumptions by Consumers Energy as to
projected future deliveries of electricity to customers, expected delinquencies
and write-offs, future payments and costs and expenses relating to
securitization property and the securitization bonds, any deficiency in the
Capital or Overcollateralization Subaccounts and any amounts on deposit in the
Reserve Subaccount.


2. SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions. These estimates and assumptions affect the reported amount of
revenues, expenses, assets, and liabilities and disclosure of contingencies.
Actual results could differ from these estimates.

INCOME TAXES

Consumers Funding has elected not to be taxed as a corporation for Federal
income tax purposes. Consumers Funding is treated as a division of Consumers
Energy, and accordingly, will not be treated as a separate taxable entity.

RESTRICTED CASH

The trustee has established the following subaccounts for the securitization
bonds.

GENERAL SUBACCOUNT: The General Subaccount is comprised of Securitization Charge
collections and interest earned from short-term investments. These amounts
accumulate until the trustee pays principal, interest, service and
administration fees and other expenses. At December 31, 2001, the General
Subaccount contained a balance of $1.3 million.

RESERVE SUBACCOUNT: The Reserve Subaccount includes any Securitization Charge
collections in excess of the amounts required in the General,
Overcollateralization and Capital Subaccounts. The trustee will draw funds from
this subaccount first if the General Subaccount is insufficient to make
scheduled payments. At December 31, 2001, there was no balance in the Reserve
Subaccount.

OVERCOLLATERALIZATION SUBACCOUNT: On each payment date, the trustee will deposit
in the Overcollateralization Subaccount a predetermined, specified amount so
that the account balance reaches the required amount of $2.3 million, which
represents 0.5 percent of the initial outstanding

                                 Page 13 of 21
<PAGE>

principal balance of the securitization bonds. If amounts available in the
General Subaccount and the Reserve Subaccount are not sufficient on any payment
date to make scheduled payments to the securitization bondholders and to pay the
required expenses, fees and charges, the trustee will draw on the amounts in the
Overcollateralization Subaccount to make those payments. The first scheduled
funding of the Overcollateralization Subaccount by the trustee will occur at the
first scheduled payment date of July 20, 2002.

CAPITAL SUBACCOUNT: The Capital Subaccount was established on November 8, 2001.
Consumers Energy deposited $2.3 million into the Capital Subaccount, an amount
equal to 0.5 percent of the initial principal balance of the securitization
bonds. If amounts available in the General Subaccount, the Reserve Subaccount
and the Overcollateralization Subaccount are not sufficient on any payment date
to make scheduled payments of principal and interest to the securitization
bondholders and to pay the expenses, fees and charges of Consumers Funding, the
trustee will draw on amounts in the Capital Subaccount to make those payments.
At December 31, 2001, the Capital Subaccount contained a balance of $2.3
million.

OTHER QUALIFIED COSTS

All initial other qualified costs, as authorized by the MPSC Financing Order,
have been paid by Consumers Energy. These costs have been capitalized by
Consumers Energy and are being amortized over the life of the securitization
bonds by Consumers Energy.


3. LONG-TERM DEBT

On November 8, 2001, Consumers Funding issued $468.6 million of securitization
bonds, in six classes at interest rates ranging from 2.59 percent to 5.76
percent. Consumers Funding used the proceeds from the securitization bonds to
purchase securitization property from Consumers Energy.

Scheduled maturities and interest rates for the securitization bonds at December
31, 2001 are as follows:

<TABLE>
<CAPTION>
                                                 Initial Class          Expected
                                                     Principal             Final            Final
                                Bond                   Balance           Payment         Maturity
             Class              Rate            (in thousands)              Date             Date
             ------------------------------------------------------------------------------------
<S>                            <C>              <C>                  <C>               <C>
               A-1             2.59%                  $ 26,000         4/20/2003        4/20/2005
               A-2             3.80%                    84,000         4/20/2006        4/20/2008
               A-3             4.55%                    31,000         4/20/2007        4/20/2009
               A-4             4.98%                    95,000         4/20/2010        4/20/2012
               A-5             5.43%                   117,000         4/20/2013        4/20/2015
               A-6             5.76%                   115,592        10/20/2015       10/20/2016
                                                      --------

     Total                                            $468,592
     Current Maturities                                (15,650)
                                                      --------
     Long-Term Debt                                   $452,942
                                                      ========
</TABLE>

Current maturities are based on the expected final payment dates indicated
above.



                                 Page 14 of 21

<PAGE>

The amortization schedule for the securitization bonds provides for an initial
payment to bondholders on July 20, 2002 and then quarterly thereafter. The
following table provides the expected principal retirement of the securitization
bonds over the next five years (in thousands).

<TABLE>
<CAPTION>
                                         Principal
                    Year                Retirement
                    ----                ----------
<S>                                     <C>
                    2002                  $ 15,650
                    2003                    26,905
                    2004                    27,786
                    2005                    28,646
                    2006                    29,591
</TABLE>






                                 Page 15 of 21


<PAGE>


4. FAIR VALUE OF FINANCIAL INSTRUMENTS

Restricted cash is on deposit with the trustee, and by definition, is carried at
its fair value. At December 31, 2001, Consumers Funding had a financial asset
(representing its securitization receivable from Consumers Energy), and
financial liabilities (representing the securitization bonds) each with a cost
basis of approximately $468.6 million. The securitization receivable and
securitization bonds are carried at cost, which approximates fair value. Fair
value is estimated based on quoted market prices, or, in the absence of specific
market prices, on quoted market prices of similar investments or other valuation
techniques.

5. SIGNIFICANT AGREEMENTS AND RELATED PARTY TRANSACTIONS

Under the servicing and administration agreements, Consumers Energy is required
to manage and administer the securitization property of Consumers Funding and to
collect the Securitization Charge on behalf of Consumers Funding. Consumers
Funding pays a servicing fee which currently totals approximately $1.2 million
annually (see Note 1) and an annual administrative fee of $80,000. These fees
are payable to Consumers Energy on each scheduled quarterly payment date
beginning July 20, 2002. For the period ending December 31, 2001, Consumers
Funding has recorded servicing and administration fees of $117,000 and $12,000,
respectively, and has recorded a corresponding liability on its balance sheet.









                                 Page 16 of 21


<PAGE>
              ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
                     ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.



                                    PART III

           ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Omitted pursuant to Instruction I of Form 10-K.



                         ITEM 11. EXECUTIVE COMPENSATION

Omitted pursuant to Instruction I of Form 10-K.


          ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                                   MANAGEMENT

Omitted pursuant to Instruction I of Form 10-K.



             ITEM 13. CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

Omitted pursuant to Instruction I of Form 10-K.



                                 Page 17 of 21

<PAGE>
                                     PART IV

    ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

     (a)       The following documents are filed as part of this report:

               1.     Financial Statements -- included in response to Item 8.

               2.     Financial Statement Schedules.

                      None.

               3.     Exhibits.

                      See Exhibit Index that appears following the Signature
                      page to this report.

     (b)       Reports on Form 8-K:

               Consumers Funding filed Current Reports on October 26, 2001,
               November 1, 2001 and November 15, 2001 covering matters pursuant
               to Item 5. Other Events and Item 7. Financial Statements and
               Exhibits.








                                 Page 18 of 21

<PAGE>
                                   SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                      CONSUMERS FUNDING LLC



                                      By /s/Laura L. Mountcastle
                                         --------------------------------------
                                         Laura L. Mountcastle
                                         President, Chief Executive Officer,
                                         Chief Financial Officer and Treasurer



     Pursuant to the requirements of the Securities Exchange Act of 1934, this
Annual Report has been signed below by the following persons on behalf of
Consumers Funding LLC and in the capacities and on the 29th day of March 2002.


           Signature                                   Title
------------------------------          ----------------------------------------


By /s/Laura L. Mountcastle              President, Chief Executive Officer,
      ------------------------          Chief Financial Officer and Treasurer
      Laura L. Mountcastle


By /s/Glenn P. Barba                    Chief Accounting Officer and Controller
      ------------------------
      Glenn P. Barba


By /s/Michael D. VanHemert              Manager
      ------------------------
      Michael D. VanHemert


By /s/David A. Mikelonis                Manager
      ------------------------
      David A. Mikelonis


By /s/Alan M. Wright                    Manager
      ------------------------
      Alan M. Wright



                                 Page 19 of 21
<PAGE>

                                INDEX TO EXHIBITS
                          -----------------------------

The following Exhibits indicated by an asterisk preceding the Exhibit number are
filed herewith. The balance of the Exhibits have heretofore been filed with the
Commission and pursuant to Rule 12(b) -- 32 are incorporated herein by
reference.


  Exhibit No.            Description
--------------           -------------------
3.1            Certificate of Formation of Consumers Funding LLC
               dated November 15, 2001. (Exhibit 4.2 to Consumers Funding S-3
               dated October 13, 2000, File No. 333-47938)
-------------- -----------------------------------------------------------------
3.1.1          Amended and Restated Certificate of Formation of Consumers
               Funding LLC dated as of November 8, 2001, which was filed with
               the Delaware Secretary of State's Office on November 6, 2001
               (Exhibit 4.4 to Consumers Funding Form 8-K Report dated November
               15, 2002, File No. 333-47938).
-------------- -----------------------------------------------------------------
4.1            Limited Liability Company Agreement of Consumers Funding LLC
               (Exhibit 4.1 to Consumers Funding S-3 dated October 13, 2000,
               File No. 333-47938).
-------------- -----------------------------------------------------------------
4.1.1          Amended and Restated Limited Liability Company Agreement of
               Consumers Funding LLC dated November 8, 2001.  (Exhibit 4.2 to
               Consumers Funding Form 8-K Report dated November
               15, 2001, File No. 333-47938)
-------------- -----------------------------------------------------------------
4.2            Indenture dated as of November 8, 2001 between Consumers Funding
               LLC and the Bank of New York.  (Exhibit 4.3.1 to Consumers
               Funding Form 8-K Report dated November 15, 2001, File No.
               333-47938)
-------------- -----------------------------------------------------------------
4.3            Series Supplement dated as of November 8, 2001 between Consumers
               Funding LLC and the Bank of New York. (Exhibit 4.3.2 to Consumers
               Funding Form 8-K Report dated November 15, 2001, File No.
               333-47938)
-------------- -----------------------------------------------------------------
10.1           Sale Agreement dated as of November 8, 2001 between Consumers
               Energy Company and Consumers Funding LLC (Exhibit 10.1 to
               Consumers Funding Form 8-K Report dated November 15, 2001,
               File No. 333-47938).
-------------- -----------------------------------------------------------------
10.2           Servicing Agreement dated as of November 8, 2001 between
               Consumers Funding LLC and Consumers Energy Company.  (Exhibit
               10.2 to Consumers Funding Form 8-K Report dated November 15,
               2001, File No. 333-47938).
-------------- -----------------------------------------------------------------
10.3           Intercreditor Agreement dated as of November 8, 2001 among
               Canadian Imperial Bank of Commerce, Asset Securitization
               Cooperative Corporation, The Bank of New York, Consumers Funding
               LLC and Consumers Energy Company. (Exhibit 10.3 to Consumers
               Funding Form 8-K Report dated November 15, 2001, File No.
               333-47938).
-------------- -----------------------------------------------------------------
*99            Consumer Funding's letter confirming receipt of certain
               representations from Arthur Andersen LLP
-------------- -----------------------------------------------------------------


                                 Page 20 of 21