Officials with Baltimore Gas and Electric Co., the largest energy provider in Maryland, told regulators at a hearing yesterday that home-heating bills have skyrocketed this winter mainly because of significantly colder weather, greater household consumption and, to a lesser extent, spikes in commodity costs for electricity and gas.
Company officials also noted other factors - including longer billing cycles in November and December and the proliferation of more energy-sapping devices such as big-screen TVs and game console systems - as potential causes for a sharp increase in customer complaints to BGE and the Public Service Commission, the agency that oversees it and other energy providers in Maryland.
This winter, residential customers across the state have complained to the PSC that their energy bills have, in some cases, doubled in recent months. The increases are stretching the state Office of Home Energy Programs, whose officials testified yesterday at a PSC hearing that they're already close to doubling the number of low-income households receiving aid to pay their bills.
"It is a clear demonstration of the difficulty families are facing in light of the increasing electric bills and a weakened economy," said Ralph Markus, director of OHEP, a program within the Maryland Department of Human Resources.
Other utilities and energy cooperatives also attended the public hearing at the PSC's office in downtown Baltimore, to explain to the agency's commissioners why costs have soared this winter and what they're doing to help customers keep from having their heat turned off.
PSC Chairman Douglas R.M. Nazarian said the session was organized for the commission to question company officials and gather facts because of the outpouring of consumer complaints. Nazarian said the PSC has gotten "hundreds" of complaints, while BGE officials said they've fielded 14,000 "high bill" complaints.
The hearing wasn't scheduled to allow input from the public, but some residents faced with high energy bills showed up and spoke with reporters.
Sylvia Collins, an East Baltimore resident, attended the hearing because she's trying to understand the increase in her bill. She said her December bill was $260 - and last month it jumped to $450. Collins, who has lived in her house for 15 years, took steps to improve her home's energy efficiency after being hit by high bills last year, too.
"I've spent a lot of money installing new windows and doors," Collins said.
Though improving a home's energy efficiency can help save money, BGE officials pointed to the main culprit of higher heating bills: the cold weather. In a chart showing temperature comparisons between last winter and this winter, a BGE official noted that there had been nearly 300 more hours this winter of temperatures below 30 degrees Fahrenheit. BGE customers had to contend with 40 more hours of temperatures that dipped below 20 degrees, according to BGE figures.
Wayne Harbaugh, BGE's vice president of pricing and regulatory services, said the sharply colder weather meant that heating systems had to work harder to maintain temperatures that residents had set in their homes. He also said that customers likely used more energy heating the cold water that comes into their homes because the water itself was colder.
The impact on low-income families has been high, according to Markus, of the state's Office of Home Energy Programs. Through last week, the office has issued payments, up to $2,000 each, to more than 13,000 families, at a cost of $12.4 million. In the last fiscal year, the state program paid $6.4 million on behalf of nearly 8,000 customers.
PSC commissioners questioned BGE on a number of topics, including whether the company could better demonstrate in its bills to customers the impact that severe cold weather is having on their energy consumption. Harbaugh said the company has already started an internal group that's looking at ways to improve billing statements. He also said the company is moving toward implementing "smart" technology that would eventually allow it to pinpoint in customers' homes the exact sources of consumption that might be driving up costs.
The commissioners also took issue with the billing cycle that BGE uses, where customers can be billed for usage of anywhere between 28 and 34 days. Many customers have seen a longer billing cycle this past winter, in part due to severe icy weather that prevented BGE workers from reading meters, company officials said.
"The problem is when you're on the high end, a big bill comes because you're tacking on six or seven days," said Susanne Brogan, a PSC commissioner.
One of the biggest concerns for the commission remained how to help a vocal minority of Maryland residents get over the immediate sticker shock of higher energy bills this winter. BGE said it encourages consumers to sign up for its "budget billing" program, which bills the customer the same average amount each month, regardless of winter or summer weather, so the bills are immune from volatile swings.
Another factor in higher bills is the higher commodity costs: Electric rates are up 12.5 percent over last winter, while gas rates have climbed 5 percent, BGE figures show.
In a statement, Maryland PIRG, a nonprofit public interest advocacy group, called on the PSC to "get to the bottom of this problem" and "prioritize implementation of known solutions."