BGE confusion
BGE customers are looking at the old "price to compare" for generation/transmission on their bills: 10.88 cents per kilowatt hour. Then they look at the new price to compare, effective today: 10.85 cents per kilowatt hour. Then they say: "THAT'S not a 50 percent increase, as the Public Service Commission & the newspaper are reporting. That's a DECREASE. What's up?"
Explanation: Overall costs are going up 50 percent because a CREDIT of 4.5 or 5 cents per kilowatt hour applied to BGE's DISTRIBUTION BILL disappears today. This credit is a loan that basically limited last year's 72 percent price increase to 15 percent. BGE will collect repayments on the loan from its customer base in dribbles over 10 years. So: The market price for energy has changed hardly at all. But the disappearance of the credit means that BGE customers will see big -- 50 percent increases -- in their total electric bills.
Comments
Based on the comment in your blog about this confusion, the distribution cost will increase and everyone will share in paying that. I switched to OHMS energy int December 2006 and recently renewed at a cost higher that BGE since I thought BGE was increasing 50%. This seems like a bad decison now since I too will have an increase in the distribution cost also. I will only benefit if the BGE Summer rates go higher this fall.
Posted by: Barry Harding | June 1, 2007 1:18 PM