Electrifying changes

July 02, 2006|By TRICIA BISHOP | TRICIA BISHOP,SUN REPORTER

The rate increase has arrived. Yesterday electricity prices for Baltimore Gas and Electric's 1.1 million residential customers rose enough to eventually make electric bills about 72 percent higher: But new credits were also put in place, which will keep the initial jump to about 15 percent under a multi-year phase-in plan put together by the legislature.

The rise has made headlines for months, worked politicians into a lather and caused consumers no small amount of upset. Still, it's a topic that's jumbled in the minds of many.

This is a look at various parts of the BGE electric bill, what they mean and how they'll change. So grab an old bill, and get set to compare the labeled sections.

But first, a note: Customers will pay June rates for June days and July rates for July days, even if their bills come mid-month and run, say, from June 10 through July 10. Most won't see the full effects until their August bills arrive.

tricia.bishop@baltsun.com

Changes to look for in your BGE bill

Stabilization deferral

This is a new line that will appear in the summary section of the bill on page one.

15%

The deferral is basically a credit that will be deducted from the electric bill to keep the increase this year to about 15 percent. It will be calculated by adding about 5 cents back to the prices charged per kilowatt hour.

72 %

This is the average amount electric bills would increase if the deferral credit weren't there.

Charges this period

This line will now reflect the price you would have paid if the full increase were in effect.

Total amount due

This line will be calculated by subtracting the stabilization deferral from the "charges this period."

Your Price to Compare

This area appears right under the summary box on the bill's first page. It's an average based on annual prices and includes the cost to generate and transmit electricity, but not the costs of delivering it or the associated surcharges and taxes.

BGE says the price to compare is the one to use when looking at the prices offered by competing companies. Thus far, only a half-dozen potential competitors have stepped forward to express interest in taking on BGE customers.

5 cents

Last year's price to compare per kilowatt hour

11.03 cents

The new price to compare per kilowatt hour as of July 1 - a 120 percent increase.

3 cents

The amount that distribution fees add to the actual price per kilowatt hour. You will pay the delivery fee to BGE no matter who your electric provider is: It owns the delivery lines competitors would have to use. This price hasn't changed much in 13 years, and isn't expected to anytime soon.

Electric Usage Profile

At the top right-hand side of the electric bill, this area shows how much juice you've used. It changes throughout the year. During June through September, when air conditioners are running full blast, usage is the highest, followed by winters in homes with electric heat.

30%

The amount electric usage has increased since 1995 as homes have added more gadgets: VCRs and DVDs, computers, cell phone chargers, iPods and home theaters.

BGE Electric Supply

This is where all the action happens. It's on page two of the electric bill and denotes the generation and the transmission components of electricity supply. It's the only price that's actually going up.

6.1 cents 4.3 cents

(summer) (non-summer)

These are the summer supply rates and non-summer supply rates per kilowatt hour respectively the past year.

11.9 cents 10.5 cents

(summer) (non-summer

These are the new summer and non-summer rates BGE is charging per kilowatt hour as of July 1. (Don't forget, you'll have to add the 3-cent delivery fee and various taxes and surcharges to get the total price of around 14 cents per kilowatt hour.)

95% 144%

(summer) (non-summer

The respective increases in summer and non-summer supply rates this year. Even though the price of supplying electricity has gone up this much, the total electric bill will rise by less because other costs - such as state taxes and distribution fees - don't change. And the stabilization deferral credit will keep the increase even lower for the first year.

Looking ahead

In January, three other items will make their way onto the bills.

$2.19 plus or minus

First, a repayment fee will appear to make up for that "stabilization deferral" credit. This has been widely identified as being about $2.19 per month, but the reality is it will differ for everyone. The fee is a "usage fee" and proportionately based on how much electricity a household uses. The average should be around $2.19, but those who use more electricity than average will pay more. If you use less, your fee will be lower.

Credits

These are for fees BGE was allowed to collect, but has since promised to give back.

The first was paid by customers for the decommissioning of the Calvert Cliffs nuclear power plant, which no longer has any direct link to BGE. (Its parent company, Constellation Energy Group, bought the plant from BGE in 2000 for what some say was a bargain price, raising questions about why BGE customers should pay a fee for it.)

The second was a fee that BGE got because it's required to provide service to customers if no one else will. BGE will still have to do this, but it has agreed to give up extra payment for it.

BGE has not yet worked out the amounts associated with those credits or figured out what to call them.

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