Petition for PSC hearings rejected

State panel reaffirms suspension to hasten electricity settlement

Deregulation

May 12, 1999|By Shanon D. Murray | Shanon D. Murray,SUN STAFF

Saying public hearings might push settlement talks "to the back burner," the Public Service Commission yesterday affirmed its decision to suspend hearings on deregulating Maryland's electric industry.

After an emergency meeting to hear a petition by the Mid-Atlantic Power Supply Association (MAPSA), a New Jersey-based group of retail electricity suppliers that hope to serve residential and business communities in Maryland, the PSC said suspending the hearings to allow further settlement discussions was "in the public interest."

"We felt that continuing litigation would push a settlement to the back burner," said Glenn F. Ivey, PSC chairman. "It makes sense to go forward with a settlement."

However, at least one consumers group would prefer to see public hearings.

"It is very important to shine the light of day on electricity deregulation because of its cost implications," said Adrienne Hahn, legislative counsel for Consumers Un- ion, the Washington-based publisher of Consumer Reports magazine.

"Deregulation is a very important pocketbook issue for consumers, so it's critical to provide for public debate," Hahn said. "It's disconcerting when a utility takes control of the discussion through settlement negotiations."

MAPSA wanted hearings to determine key deregulation issues, including a request by Baltimore Gas and Electric Co. for cost recovery, price protection for customers, and a request by the People's Counsel for a rate reduction.

The hearings had been scheduled to begin Friday. Last week, the PSC granted a motion by BGE's holding company, Constellation Energy Group, to suspend the hearings on deregulation.

Constellation said it sought the suspension because the additional time would allow a final settlement to be reached and given to the PSC by June 15. The nature of the confidential settlement most likely will not become public until then.

"We believe the [settlement] discussions so far are making it difficult to create a competitive market," said Gary Alexander, an attorney representing MAPSA. "We don't want BGE to end up as the only supplier in Maryland.

"But MAPSA will continue to negotiate in good faith. We'll go forward with settlement discussions with the hope all Maryland customers will have the right to choose."

Michael Delaney, a Constellation spokesman, said the company wants the settlement talks to be inclusive.

"We're ready, willing and able to continue discussion with all parties involved, including MAPSA and their members," he said. "We intend to do what we can to meet the June deadline."

Gov. Parris N. Glendening recently signed legislation enabling Marylanders to shop for electricity, starting next year. But decisions made by the PSC -- a panel of five regulators -- will determine the details.

A successful settlement in the densely complicated, potentially lucrative and fiercely competitive deregulation case must be to the liking of a multitude of parties, including industrial, commercial and residential customers, suppliers, the federal government and local municipalities.

"There won't be any rush to judgment on this issue," said Ivey, the PSC chairman. "We will take a look at the draft settlement and have a full airing of the issues."

He continued, "It appears settlement negotiations are going pretty well, at least for a majority of the parties."

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