Maryland legislators say they want to help lower electric bills ? of course. But they have demonstrated what they know how to do is addict residents to their air conditioning and make decisions that ultimately drive rates higher.
The looming rate spike for Baltimore Gas and Electric Co. customers could mean the end of date night for some couples. For some families, it could force the choice between air conditioning and putting food on the table, or worse ? especially with today?s negative savings rates.
While the original plan to raise rates 72 percent could be scrapped, one that will phase price increases in is being negotiated. With either option, the pain will be acute.
Most seem to be blaming the power company for trying to gouge them. Buttressing that conclusion is the fact that Constellation Energy Group, which owns BGE, has seen its total revenues nearly double from $9.5 billion in 2003 to $17.1 billion last year.
But a real culprit is the Maryland Legislature. By capping prices for six years at pre-1993 levels, the state changed people?s behavior. We got used to using more energy than we could actually pay for at market prices.
Second, the Legislature squashed competition from delivery companies ? at least for the short term. What business wants to or could offer service at below-market prices for seven years? Shielding customers for another 18 months ? the plan being negotiated ? will keep up the tradition.
Competition will not lower prices to pre-cap rates, however. The price of producing energy from natural gas has skyrocketed over the past year because of surging global demand from places like China and India and Hurricane Katrina, which disrupted production and transmission. What it could do is make alternative energy more attractive. Pepco Energy Services already offers “green” energy for a higher cost than BGE?s current rates. But its electricity will be 12 percent cheaper than BGE?s summer rates after July 1.
And third ? power generation competitors will likely never move to the local market. Washington Gas Energy Services Inc. is the only new company to say it will offer electricity generation for local customers. Its rates will run 10 percent below BGE?s summer rates and 3 percent below rates for the rest of the year.
The reason: building power plants doesn?t make sense economically. High fuel prices, steep transportation costs for moving coal to plants, and the cost of complying with environmental regulations means power generators can?t recoup expenses fast enough to finance new plants.
Aside from moving back to a regulated market, the best option is to make the utility environment as hospitable to competition as possible. Unfortunately, that means letting consumers bear the brunt of rate hikes.
Here are local legislators who voted for the deregulation bill in 1999 who are still in office:
District 5 ? Baltimore and Carroll counties
? Sen. Larry Haines (R)
? Del. Tanya Shewell (R)
? Del. Nancy Stocksdale (R)
District 5B ? Baltimore county
? Del. Wade Kach (R)
District 6 ? Baltimore County
? Sen. Norman Stone, Jr. (D)
? Del. John Arnick (D)
? Del. Joseph Minnick (D)
? Del. Michael Weir, Jr. (D)
District 7 ? Baltimore and Harford counties
? Sen. Andrew Harris (R)
District 8 ? Baltimore County
? Sen. Katherine Klausmeier (D)
District 10 ? Baltimore County
? Del. Emmett Burns, Jr. (D)
District 11 ? Baltimore County
? Sen. Paula Hollinger (D)
? Del. Bobby Zirkin (D)
District 12 ? Baltimore and Howard counties
? Sen. Edward Kasemeyer (D)
Sub District 12-A – Baltimore and Howard counties
? Del. James Malone, Jr. (D)
District 21 ? Prince George?s and Anne Arundel cos.
? Sen. John Giannetti, Jr.
District 30 ? Anne Arundel County
? Sen. John Astle (D)
? Del. Michael Busch (D)
? Del. Virginia Clagett
District 31 ? Anne Arundel County
? Sen. Philip Jimeno (D)
? Del. Joan Cadden (D)
? Del. John Leopold (R)
District 32 ? Anne Arundel County
? Sen. James DeGrange, Sr. (D)
? Del. Mary Ann Love (D)
? Del. Theodore Sophocleus (D)
District 33 ? Anne Arundel County
? Sen. Janet Greenip (R)
Sub District 33A ? Anne Arundel County
? Del. David Boschert (R)
District 34 ? Harford and Cecil counties
? Sen. Nancy Jacobs (R)
District 34A ? Harford and Cecil counties
? Mary-Dulany James (D)
District 35
? Sen. J. Robert Hooper (R)
Sub-District 35A ? Harford County
? Del. Barry Glassman (R)
? Del. Joanne Parrott (R)
District 40 ? Baltimore City
? Del. Salima Siler Marriott (D)
District 41 ? Baltimore City
? Del. Samuel Rosenberg (D)
District 43 ? Baltimore City
? Del. Ann Marie Doory (D)
? Del. Maggie McIntosh (D)
District 45 ? Baltimore City
? Sen. Nathaniel McFadden (D)
? Del. Clarence Davis (D)
? Del. Hattie Harrison (D)
District 46 ? Baltimore City
? Del. Peter Hammen (D)
? Del Carolyn Krysiak (D)
