BGE is urged to consider delaying new generator

June 22, 1994|By Ross Hetrick | Ross Hetrick,Sun Staff Writer

A deal for Baltimore Gas and Electric Co. to buy electricity from a neighboring utility is so good for ratepayers that BGE should consider pushing up the implementation date from 1997 to next year, according to the Office of the People's Counsel, the state agency that represents ratepayers.

"It's a question of whether this good deal could be better," said Paul S. Buckley, the acting people's counsel. "It would reduce the impact on rates," he said.

At its administrative meeting today, the Maryland Public Service Commission is scheduled to consider an agreement for PECO Energy Co. of Philadelphia to sell BGE 140 megawatts of electricity for 25 years starting in 1997.

To fill its additional power needs until then, BGE is building a $110 million, 140-megawatt combustion turbine generator at its Perryman site in Harford County. That generator is scheduled to go into service in June 1995.

While wholeheartedly supporting the PECO offer, Mr. Buckley wants BGE to study whether the PECO power would be cheaper than electricity from the Perryman generator. If it is, he would like to see BGE begin buying electricity from PECO in 1995 and delay the Perryman generator until at least 1997.

Even though construction has already begun on the Perryman generator, Mr. Buckley said it could be placed on hold and the expenses for the plant be put into an account which would accumulate carrying costs until the generator is activated in 1997 or later.

However, BGE is firmly against Mr. Buckley's proposal.

"It's ridiculous to stop construction of a plant like that now, especially when you have a signed, sealed and delivered contract with PECO for 1997 that is also in the best interest of our ratepayers," said BGE spokesman Arthur J. Slusark. He also stressed the need for building "internal" generating facilities to maintain the proper mix of sources.

But while BGE is against it, PECO executives said they're willing to talk about it.

"It is certainly something we could discuss with BGE," said PECO spokesman Neil McDermott. "There is in the contract flexibility to move the start date, but it's at their [BGE] option," he said. PECO has about 799 megawatts of excess capacity in its system, which stems from a 1990 ruling by the Pennsylvania Public Utility Commission that the company could not charge customers for part of the capacity at the company's Limerick 2 nuclear power plant near Pottstown, Pa.

Mr. Buckley is also asking the commission to lift the veil on PECO price information, which has been kept secret for competitive reasons.

Besides creating more competition among bulk power suppliers, public disclosure is important for the regulatory process itself, Mr. Buckley said.

"At its most basic level, the ongoing creditability of this regulatory process is dependent on the fact that utilities are regulated through an open, public process," Mr. Buckley said in a letter to the commission.

But both BGE and PECO say confidentiality is one of the conditions of the new competitive utility market.

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