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October 5, 2010

BGE won't get anything close to what it wants

As Hanah Cho reports, BGE wants a rate increase for distributing gas and electricity that could add up to $20 a month year to the average electric bill and $30 to the average natural gas bill. Nice try, BGE. These are charges for BGE's network of local pipes and wires to get the energy to your door. They're separate from the energy and transmission charges that create the energy and ship it cross country to the Baltimore region. Distribution charges are still fully regulated by the Public Service Commission; energy charges aren't. BGE will probably get some sort of increase.

Perhaps they're due after nearly two decades of frozen or declining distribution reimbursement. Even the Office of People's Counsel, which represents residential ratepayers, seems to think BGE is entitled to something. Its expert said BGE needs an increase of about $21.5 million for distributing electricity and about $8 million for distributing gas rather than the $47 million for electricity and the $30 million for gas that BGE wants. BGE is presumably hoping that falling energy prices will help regulators and consumers forget about the disaster of deregulation, which led to huge cost spikes for all users. (And no, the BGE increases of the 2000s were NOT caused merely by energy inflation. An open market with fungible megawatts allowed BGE parent Constellation Energy huge markups on the cheap energy generated by its Calvert Cliffs nuclear plants.

Under regulation those low costs would be passed on to customers.) But nobody has forgotten. The BGE energy increase was topic A of the first gubernatorial contest between Bob Ehrlich and Martin O'Malley. The reprise of that match has made the memories keener, and this PSC knows that. BGE won't get anything close to what it wants. Here is today's column on how to save money from falling electricity prices by switching from the standard BGE product to an alternative provider.

Posted by Jay Hancock at 9:06 AM | | Comments (3)
Categories: BGE/electricity
        

Comments

Please read your references more carefully. The BGE proposal- even as reported in Ms. Cho's column- amounts to $20/30 per year, not per month. I can only hope that this was a mistake on your part, and not a willful misrepresentation of the facts.

Thanks Leo. My bad. Rushing out of the house with not enough coffee. JH

Actually, you can do even better than Jay wrote with Wash Gas Energy Services-- IF you input this promotional code on the entry page website; eahome-ea1019

It will lower your one year rate to just $8.90!!

No one can complain about 2 dollars a month increase when only 8% of people have taken advantage of BGE energy choice program.which could save them 10 to 50 times that. even without a contract or fees to do so.its a no brainer. www.savingongreen.com

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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