On July 2, for the fourth consecutive year, Baltimore Gas & Electric Co. asked the Public Service Commission to approve a rate distribution increase for citizens, who receive both gas and electric service.
For each of the past three years, BGE has gotten an increase in the rate distribution charge, which has added $6.80 a month to the average electric bill and $4.28 to the average gas bill. If the PSC allows this fourth increase, additional monthly charges will amount to an average of $6.57 on electric bills and $8.53 on gas bills.
As it has usually done, the PSC will probably scale back the requested increase but, in the end, as usually happens, BGE will get the increase and we will pay it.
The root cause of skyrocketing gas and electric bills is the 1999 passage of Electric Deregulation.
I was one of 13 state senators who opposed electric deregulation — a concept cooked up and pushed by Enron and a group of lobbyists with promises of lower rates and electric competition, which never materialized. Deregulation created an unregulated monopoly and stripped the PSC of much of its regulatory oversight and market control power.
In fact, the consequences of electric deregulation for consumers have dwarfed my worst expectations. Electric deregulation has unleashed corporate utility greed, that has translated into annual increases in monthly residential and business gas and electric rates. It has made a reality of the utilities' fondest dream to make consumers pay monthly surcharges up front for improvements to equipment and services before they are completed.
In 2013, I opposed passage of legislation allowing a monthly surcharge of up to $2 on residential utility bills to pay up front for replacement of aging gas pipelines. In addition to allowing the gas surcharge, the approved legislation permits the PSC to grant similar surcharges to utilities.
In December 2013, the PSC granted BGE a monthly electric surcharge beginning at 8 cents, effective April 20, 2014. Utilities have always been entitled to recover costs for improvements from ratepayers. However, those costs have always been recovered after the work was completed and not before it was even begun.
I, along with AARP, consumer advocacy groups, and the People's Counsel have strongly opposed both gas and electric monthly customer surcharges, emphasizing that users should not have to prepay extra money for improvements before the work is done. BGE says it needs the additional revenue to cover the cost of its project to upgrade infrastructure, in order to improve service. Wasn't the monthly surcharge supposed to cover that?
I wish I could give you a more optimistic analysis of the situation. However, I will not sugarcoat a situation in which we are at the mercy of a greedy monopoly and impotent governmental controls. I will continue to seek legislative solutions to this intolerable problem which victimizes all BGE users.
Please do not hesitate to contact me. I encourage and welcome your input on state issues and legislative concerns.
Sen. Delores Kelley