July 22 was the first time in four years that BGE had an emergency activation of our PeakRewards program.
This emergency electric load reduction, which was repeated across the region by other utilities to varying degrees, was taken at the direction of the PJM Interconnection, the regional transmission operator (power grid) serving Maryland and several other states.
In the past, BGE has had some non-emergency events with lower impact.
However, emergency activations of the program have been infrequent and are expected to remain infrequent in the future.
It is important to remember that the PeakRewards program did its job on July 22.
The program is designed, in part, to lower demand for electricity when we need it most.
On July 22, when demand was extremely high and conditions on the electric system were challenging, the emergency activation of the program resulted in the reduction of peak energy demand of more than 600 megawatts, equivalent to a medium-sized power plant.
Reducing demand improved system reliability and helped avoid potential brownouts and rolling blackouts – similar to what happened in other states – that could have interrupted electric service to all of BG&E's 1.2 million electric customers throughout central Maryland.
The successful peak demand reduction was only possible because of the 450,000 BGE customers who participate in this voluntary program.
In addition to reducing demand, the PeakRewards program also helps to defer the need for new and expensive power plants, which benefits the environment and helps lower the cost of electricity.
Customers participating in the voluntary program also receive annual bill credits of up to $200 in the first year and up to $100 every year thereafter. Bill credits to participating BGE customers will exceed $20 million this year alone. These credits are paid to customers whether or not BGE ever needs to call on the customers to reduce usage.
However, we recognize the frustration experienced by some of our PeakRewards customers as a result of the recent emergency activation.
We appreciate the challenges some customers faced, who didn't have central air conditioning for an extended period of time on a very hot day.
We also understand the frustration expressed by some who needed a better understanding of the program or had difficulty contacting us during this event.
We are working to identify potential areas of improvement to ensure the program continues to successfully reduce peak electric demand and meet our customers' expectations.
We believe our PeakRewards program has tremendous value.
We know some PeakRewards customers are frustrated with the program right now and appreciate the feedback we have received.
We know we must do a better job communicating and working with customers before, during and after PeakRewards events occur. We are reviewing our processes and evaluating potential improvements.
We look forward to our customers' continued support and participation in this important program.
senior vice president and chief customer officer