Maryland proposes how it would spend $113.5 million in BGE fund

The state outlined Friday how it proposes to spend the $113.5 million that Exelon Corp. agreed to put in a "customer investment fund" as part of its merger with Baltimore Gas and Electric Co.'s parent.

The biggest piece — $44 million — would go to weatherization services and furnace replacement for low-income residents with high energy bills. Other proposed uses include building off-the-grid public schools and helping small businesses improve their energy efficiency.


The Maryland Public Service Commission approved Exelon's acquisition of Baltimore-based Constellation Energy Group this year on the condition that it create the investment fund with half of the merger's estimated "synergy" savings. Regulators said BGE customers, not just Constellation shareholders, needed to reap benefits from the merger.

The commission will decide how the money will be spent. Others making proposals for some or all of the funds include BGE, the city of Baltimore and the Maryland Office of People's Counsel, which advocates for utility customers. A hearing on the recommendations is scheduled Aug. 7.


The people's counsel office could not be reached for comment on the state's plan, announced after 5 p.m. Friday.

Gov. Martin O'Malley's office pitched the state's proposal as a way to conserve energy, save BGE customers more than $278 million over 10 years and create or retain hundreds of jobs.

"This is a one-time opportunity," said Abby Hopper, the governor's energy adviser. "We're trying to use this money to create long-lasting effects that will exceed the duration of the … fund."

The $44 million for weatherization would be split, with half going to help Baltimore residents and the rest to suburban BGE customers. The state expects that more than 4,000 households would be assisted. In addition to weatherization, workers would look for lead hazards, mold and structural deficiencies in need of fixing, the state said.

The state also wants to spend $15 million building five "net zero energy" schools — one in the city and four in the suburbs — that wouldn't use electricity from the grid thanks to renewable energy systems and "advanced energy efficiency measures."

Other parts of the state's proposal:

•$23 million for a mix of advances and loans to small businesses upgrading to become more energy-efficient

•$10 million to update the state's bill arrearage forgiveness program, including expanding it to natural gas customers


•$9 million for energy-efficiency retrofits at affordable-housing complexes

•$7.5 million toward efforts to help manufacturers, industrial customers and the broader community reduce energy costs

•$5 million to reduce the state's Maryland Mortgage Program interest rate and offer a below-market second loan for energy efficiency improvements