The Maryland Public Service Commission will consider this week cutting the monthly fee Baltimore Gas and Electric Co. customers must pay to opt out of having smart meters installed after the utility reported that the number of people opting out is more than three times what was anticipated.
BGE instituted a fee of $11 a month, plus a $75 one-time fee, for customers who choose not to have the meters installed to pay for the cost of maintaining two systems. But, with more customers opting out than expected, the overall cost of maintaining the smart meter system and the analog system now may be lower than expected, according to BGE.
BGE began replacing analog gas and electric meters in 2012 and has mostly completed the task. But two challenges remain: customers whose meters are inside or not easily accessible and so cannot easily be replaced, and those who decline the new meters because they fear it will harm their health or privacy.
The PSC, which issued the order to allow customers to opt out estimated that about 1 percent would do so, a rate similar to that in other states with smart meters.
Instead, BGE said, the rate has hovered between 3.8 percent and 4.15 percent, or more than 51,000 people, as BGE continues the installations. The number changes as customers move in and out of BGE's service area.
The PSC will meet Thursday to consider lowering the fees as part of a "true up" 18 months after BGE began levying the fees. The PSC ordered BGE to report on opt-outs and costs in order to align the fee with actual costs.
BGE is not asking for any particular rate and will let the PSC determine the appropriate charge, BGE spokeswoman Rhea Marshall said.
Given an opt-out rate of 4 percent, the monthly fee should be about $4.26, BGE said in its filings with the PSC. A 2 percent opt-out rate would mean a $6.81 monthly fee. There is no proposal to change the $75 initial fee.
The majority of those opting out are in Baltimore, particularly in poorer neighborhoods, according to BGE.
Since BGE's installation is ongoing, the PSC may decide on an interim change to the monthly fee, then set a final one when the process is complete. BGE estimates that reaching a 1 percent opt-out rate could take three years.
About 43 percent of those customers opting out of the new meters are "voluntary," according to BGE. The rest have analog meters in hard-to-access locations and haven't scheduled an appointment yet for BGE to replace them. In some cases, the resident agreed to changing the electric meter but hasn't scheduled an appointment to get a new smart gas meter, Marshall said.
"We're thinking this is going to stabilize because there are customers calling every day asking to have the meters installed," Marshall said.
The staff advising the PSC recommended not changing the opt-out fee until the rate appears to stabilize, noting that many customers have been added to the opt-out list after they didn't respond to BGE's requests to make an appointment.
The Office of the People's Counsel, the state's consumer advocate, recommended lowering the rate to $3.51 a month.
"Customers largely have been dissatisfied by the size of the fee, and it would be more dissatisfying for customers to pay more than their fair share, which would be the effect of maintaining the charge at a level representing a far higher opt-out rate than was originally planned," wrote People's Counsel Paula M. Carmody in her filing.
Though most experts agree that the meters pose no harm, some consumers believe the radiation they emit can be dangerous, similar to fears over microwaves and cellphones. Others fear the meters will be used to track their activities.
Maryland Smart Meter Awareness, a group opposing the smart meters, supports lowering the opt-out fee, said Kate Kheel, the group's vice president.
"It does appear from the numbers that the fees are too high currently, and we feel they should be lowered accordingly," Kheel said. "And we encourage as many people to opt out, as they can protect their families and themselves and their homes."