As the governor who promised to stop the BGE rate increase and got hammered for failing, Martin O'Malley surely must be happy to get something back for customers.
But he might have gotten more. Yesterday's deal makes no mention of an independent investigation into the questionable 2005-2006 wholesale power auctions that caused a 70 percent price increase for households buying power from Baltimore Gas and Electric.
Pursuing it could reveal crucial information on whether BGE and customers pay a fair electricity price to the utility's parent, Constellation Energy. And it could result in even more money for BGE customers.
The question is whether the investigation is still alive. I was unable to get an authoritative response.
"I can only say we'll have more on that next week," said Steven B. Larsen, chairman of the Maryland Public Service Commission.
Two years ago, an Oregon-based consultant found that BGE customers got stuck paying 21 percent more than the market rate to Constellation and other wholesalers in a December 2005 auction.
It was one of the first times deregulation had forced BGE, which once owned its own generation plants, to buy juice on the open market.
The resulting price "is surprisingly high," McCullough Research wrote in a 2006 letter to California Rep. Henry A. Waxman, who sits on the House Committee on Energy and Commerce and was looking into electricity costs.
Most of the BGE business went to Constellation, which took over the former BGE plants under deregulation. Not only was the price much greater than the plants' cost to produce electricity, McCullough found, it was higher than what other generators charged at the same time for the same kind of power.
That raised questions about whether the auction was truly competitive.
PSC Chairman Larsen wanted to find out.
First his commission focused on the dual role played by John Collins, Constellation's chief risk officer at the time. Collins not only helped Constellation sell electricity to utilities; he advised BGE on buying electricity from Constellation and other wholesalers and got to see bids from Constellation's competitors.
Could that have affected the auction? (Relations with BGE are entirely appropriate, Constellation has said.)
Last fall, the PSC asked Joseph E. Bowring, market monitor for the Mid-Atlantic electricity grid, to investigate the BGE auctions. But Bowring, who has a demanding day job, hasn't gotten to it. Now, depending on yesterday's deal, the inquiry might be dead.
