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Measure that could raise utility bills advances in Senate

A bill that would allow a surcharge of up to $2 a month on residential utility bills to pay for new gas pipelines appears to be advancing on a fast track in the General Assembly.

The legislation would let the Maryland Public Service Commission grant the surcharge so utilities such as BGE could speed up replacement of aging pipelines. The state Senate gave preliminary approval to the measure Tuesday after a lively debate; the House of Delegates approved it Monday. Final votes on the measure, which appears likely to pass, are expected by the end of the week.

The bill seeks to address the issue of the aging distribution infrastructure of Maryland's largest for-profit gas utilities: BGE and Washington Gas and Light. Proponents say the two companies have 2,000 miles of pipeline that needs to be replaced, putting Marylanders who live nearby at risk.

"Some of these lines are 100 years old," said Sen. Thomas M. "Mac" Middleton, chairman of the Finance Committee. "This is a tool where they can expedite this whole replacement process."

Middleton, a Charles County Democrat, said the bill will benefit ratepayers, noting that the utilities are already entitled to recover their costs from the modernization work from ratepayers.

But opponents contend the utilities are trying to force ratepayers to finance up-front investments that the companies should have been making all along.

The Office of People's Counsel, which advocates for residential customers, opposes the bill, saying the reports of infrastructure problems are exaggerated.

"It's a myth that the system's going to blow up," said Theresa V. Czarski, deputy director. She said the vast majority of pipeline explosions are caused by contractors digging where they shouldn't rather than bad infrastructure.

Senate Minority Leader E. J. Pipkin, an Eastern Shore Republican, said lawmakers shouldn't "take the rap" for the utilities' pipeline safety problems. "They've shifted it to us and said, 'You fix it and use your constituents' money to do so,'" he said.

The conservative Pipkin joined a bloc of liberal Democrats led by Sen. Richard Madaleno of Montgomery County in supporting an amendment that would have required the PSC to consider the expected benefits to the companies in considering whether to approve a surcharge. Supporters of the bill said the PSC would review the costs and benefits after a surcharge was in place.

The amendment failed on a 15-29 vote.

The surcharge would not necessarily start out at the $2 maximum. For instance, under a plan submitted by Washington Gas, the surcharges would start at 8 cents a month this year and gradually increase to $1.35 over five years. Rob Gould, a spokesman for BGE, said the utility doesn't have a plan now but anticipates any surcharge it might seek would be under the $2 cap.

According to the Department of Legislative Services, there were 30 "significant incidents" involving pipelines in Maryland from 2002 to 2011, killing one, injuring 16 and causing $12 million in property damage.

michael.dresser@baltsun.com

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