Making energy policy an issue

The Baltimore Sun

With two announcements in two days and more on the way, Gov. Martin O'Malley has elevated state energy policy to the top tier of his administration's priorities -- a move that could help him blunt political criticism over the electric rate increases he failed to stop.

With the 50 percent BGE rate increase that took effect June 1, the governor faces the possibility of a hot and cranky electorate as Marylanders are forced to think twice before turning on the air conditioning. Political friends and foes alike say O'Malley is wise to focus on the electricity rates.

"It's a big deal," said Del. Curtis S. Anderson, a Baltimore Democrat who was heavily involved in last year's fight over the rate increase. "Clearly, there is a problem, and it's a problem that could affect virtually every Marylander."

O'Malley promised in last year's campaign to stop the BGE rate increase, but after an investigation this spring by his appointees to the Public Service Commission, he was forced to concede that there was nothing the state could legally do to intervene. Since then, O'Malley has pursued policies he says are designed to make sure such a large jump in rates doesn't happen again.

He said yesterday he will hold an energy summit at the State House this month to discuss conservation, easing congested transmission lines in the state and increasing the use of clean, renewable energy. Invitations haven't gone out yet, but O'Malley said he wants to hear from utilities, businesses, consumers, environmentalists and others.

"We have to develop a state energy policy that will provide accountable, dependable and hopefully cleaner energy for our future," the governor said. "It's our biggest challenge, and it's something that is totally within our control and one that other states have been able to do."

The conservation and clean energy initiatives O'Malley is talking about also fit in with his efforts to create an environmentally friendly administration. O'Malley received widespread support from the environmental community in last year's election, and going green in a time of increased concern about global warming has political benefits -- California Gov. Arnold Schwarzenegger's energy policy landed on the cover of Newsweek in April.

O'Malley, a Democrat, talks about the environment when pitching his energy ideas, but his rhetoric focuses more on saving consumers money than on keeping carbon dioxide out of the atmosphere. That mirrors how he used energy policy in last year's election, when he sought to make it the key pocketbook issue of the campaign by blaming the increase on a cozy relationship between big business and the Republican incumbent, Gov. Robert L. Ehrlich Jr.

O'Malley still sprinkles his remarks on energy with digs at Ehrlich, saying he could not "undo in four months the effects of four years" of lax oversight under Ehrlich, and that his predecessor's policy amounted to "making the transition from regulation to deregulation without a clutch."

But mostly he has focused on keeping rates down in the future.

Yesterday, he swore in Malcolm S. Woolf, an energy policy expert who formerly worked for the National Governors Association, as the new head of the Maryland Energy Administration. A day before, he announced a seven-step program for state government to cut its energy consumption and challenged Maryland residents and businesses to cut theirs by 15 percent by the year 2015.

O'Malley said he's hoping to develop an interest-free revolving loan fund to allow businesses and residents to make energy efficiency improvements and to find ways to give utilities an incentive to help customers reduce consumption.

"Wouldn't it be great if you had energy companies coming in and saying, 'We're going to do an extreme energy makeover of your house. We're going to put in new, efficient windows, a new air conditioner. It's going to cost you nothing, and when we leave, you're going to have a lower energy bill?'" Woolf said.

A number of the ideas O'Malley is pitching could prove to be easier said than done. Yesterday, he backed the idea of developing new energy efficiency standards for residential and commercial construction, something California has done for more than 30 years to great effect.

But legislation last year requiring the use of green building techniques died in the General Assembly despite O'Malley's support, and that bill would have affected only government office buildings, not homes or businesses. A study commission is now evaluating the issue.

"We have to throw ourselves into green building technology," O'Malley said. "We have to overcome the bureaucratic notion that it will blow construction budgets sky-high."

Even if the governor succeeds at his conservation initiatives, it's unclear how much difference they'll make in consumers pocketbooks, said Sen. E. J. Pipkin, an Eastern Shore Republican who helped lead the General Assembly's negotiations on BGE rates last year.

The steps the governor is taking are good and necessary, but they are insufficient, Pipkin said.

"We need to re-regulate," Pipkin said. "This product is unique. You can't store it like you can with other products, and on top of that, as it's set up in Maryland today, if you're discontented with the electric service as a residential customer, you have virtually no choice of another company. All the conservation in the world is not going to change the fact that we have a failed energy structure."

The rate increase came early in O'Malley's term, long before he will have to run for re-election. But given the attention he has paid to the issue, the stakes for him to succeed are high.

Some are pushing for O'Malley to act immediately to re-regulate the electric market, and if a second rate crisis hits during his term, he's sure to see the backlash spread, said Anderson, the Baltimore delegate.

"The governor has the responsibility to foresee things," Anderson said. "If the problem occurs again, the question will be asked, 'Why didn't you see this coming? We just had a price rise last year.' I think it's incumbent on the governor to be the leader he says he is and to try to come up with a solution before the problems exist."

andy.green@baltsun.com

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