BGE gets OK to buy power from neighbor

June 23, 1994|By Ross Hetrick | Ross Hetrick,Sun Staff Writer

The Maryland Public Service Commission yesterday approved a contract for the Baltimore Gas and Electric Co. to buy power from a neighboring utility starting in 1997 with no formal requirement that the low-cost agreement be implemented sooner.

But the five-member board made it clear that BGE management could be held responsible in future rate hearings if its choice is not the least expensive. "Management realizes its obligations on least-cost planning," said Lilo K. Schifter, the board member who made the motion to approve the contract.

The contract calls for PECO Energy Co. of Philadelphia to supply 140 megawatts of electricity to BGE starting in June 1997. BGE also is building an $80 million, 140-megawatt combustion turbine generator at its Perryman site in Harford County, to go into service in June 1995.

The Office of the People's Counsel, the state agency that represents ratepayers before the commission, said the PECO deal is so good that the commission should require BGE to do a study to see if it is cheaper to start buying power from PECO in 1995 and delay the Perryman plant until 1997.

"We think it is their obligation," said Paul S. Buckley, the acting people's counsel. He also said it would help achieve the company's goal of being a low-cost electric provider. "All we hear from the company is competition, competition, competition," he said.

Harvey J. Reed, manager of system planning and support, said the company periodically reviews its options. But he said it was important for BGE to maintain some of its own generating facilities in Maryland so that it does not overload its ability to import power from other utilities.

The PSC granted BGE the power to impose a surcharge for the PECO contract rather than have its base rate changed in a future hearing. BGE has not submitted a surcharge rate but it will amount to only "pennies" a month on an average bill, according to David A. Brune, BGE's general counsel. The surcharge would not go into effect until BGE starts buying the electricity.

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