Furious citizens protest utility's proposed 50 percent rate rise

April 19, 2007|By Kelly Brewington and Andrew A. Green | Kelly Brewington and Andrew A. Green,SUN REPORTERS

A small but angry crowd greeted Maryland's Public Service Commission with jeers and scorn last night during a public hearing on BGE's proposed 50 percent rate increase.

The crowd of about 30 assembled at Baltimore's War Memorial Building criticized Baltimore Gas and Electric, its parent company, Constellation Energy, and Gov. Martin O'Malley, who nominated four of the five members of the Public Service Commission shortly after taking office in January and pledged to make the body more consumer-friendly.

Several people clad in T-shirts reading, "O'Malley's PSC, bought and paid for by Constellation," said that state officials are doing nothing to stop the utility from profiting on the backs of the poor.

"They're already rich; they just want to get richer," said Renee Washington. "We're already poor; we ain't got nowhere to go but being homeless."

The crowd erupted in mocking laughter when Mark Case, the head of regulatory services for BGE, said the company does everything it can to keep its prices low.

Commission Chairman Steven B. Larsen reminded the crowd at the beginning of the hearing that the rate increase is not a foregone conclusion. BGE's 1.1. million residential customers are scheduled to pay full market prices in June unless they take part in a second deferral plan, which the commission is considering during hearings throughout this week.

The increase is related to last year's 72 percent increase, which the General Assembly negotiated last summer to hold temporarily at 15 percent.

"The only thing I can tell you is ... we were appointed to make sure that whatever happens with BGE rates is justified," Larsen said. "If they are not justified, they won't happen."

Others at the hearing questioned why Maryland is not moving to reverse the legislature's 1999 decision to deregulate the electric industry. They said that Maryland should follow the lead of other states that have reinstated rate caps. Maryland's rate caps expired last summer.

Earlier yesterday, during six hours of testimony in the commission's hearing room in its downtown headquarters, commissioners discussed the future of the state's energy industry.

"The biggest question is, `How do we go forward?" said People's Counsel Paula M. Carmody in an interview. "We need to decide how electricity is going to be provided to Maryland consumers. ... Otherwise we will be back here every year asking the same questions."

During that hearing, Larsen described the electricity bidding process that resulted in the 72 percent rate increase as a "train wreck."

William B. Pino, BGE's director of electric supply, responded that high energy prices and the end of price caps, not the organization of the bidding process, contributed to the sharp increase.

Larsen asked Pino if BGE could mimic the procedure of electric company Southern Maryland Electric Cooperative, whose power contracts are larger and span more years than BGE's -- and whose average cost to ratepayers is lower.

After some terse back-and-forth, Pino said BGE could look into such a model. Said Pino: "It would warrant examination, certainly."

The commission continues its daytime hearings today, and evening public hearings are set for next week in Bel Air and Annapolis.



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