Consumers to pick own power company

Deregulation: BGE settlement gives area homeowners 6.5-percent rate cut for 6 years.

November 13, 1999

ITS A win-win situation. Baltimore-area homeowners get a guaranteed reduction in their electric bills for six years and Baltimore Gas & Electric Co. gets partial compensation for the power plants it has built.

Welcome to the world of deregulated energy markets, in which every local utility user will be free to pick his or her own power company next July.

For those who stay with the old monopoly utility, BGE, theres a 6.5 percent rate cut -- an average of $66 a year -- that will remain in effect until 2006. For those who opt for other energy suppliers, there could be even bigger savings, or there could be the prospect of using environmentally friendly green energy.

The choice will be in the consumers lap. The job of the Maryland Public Service Commission now will be to educate 1.1 million Baltimore-area electric users about their choices.

Is this a good deal for customers? Absolutely. Who doesnt like lower electric rates? Other energy suppliers, it seems. They say the PSC set electric rates so low that competitors will find it tough to undercut BGE in the scramble for customers.

In other states, though, new energy suppliers have found ways to take business from the dominant utility sometimes by offering consumers a package of services. Environmentally conscious homeowners may be especially anxious to sign up with companies that deliver nonpolluting energy.

Residential customers should start preparing for the change.

It will look a lot like the heated competition between long-distance telephone carriers, with a flurry of ads and mailings promoting lower, better rates from competing suppliers. Customers must sort through these conflicting claims. The PSC should require that all competitors use the same pricing methods so that residential owners can easily compare the offers.

While customers will have the freedom to choose an electric supplier next summer -- as they already do now for natural gas supplies -- the delivery of this power will remain in the hands of BGE, under the regulatory control of the PSC.

Thats reassuring. Power outages such as the ones experienced this fall cannot be tolerated.

Its sensible to shop around for an energy supplier, but the delivery of that power to our homes must be carefully safeguarded.

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