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BGE, Pepco heads: Md. should pass utility regulation reform

Residents and businesses across Maryland are more connected than ever to the local energy grid, and they rely on clean, safe and reliable energy to power their lives. We owe it to them to advance legislation that will better position utilities to make investments that support a more resilient energy grid, one that supports the transition to a cleaner and more sustainable energy future.

Baltimore Gas and Electric Company (BGE), Delmarva Power & Light Company (Delmarva Power), and Potomac Electric Power Company (Pepco) support legislation being considered by the Maryland General Assembly that will better position us to make these investments on behalf of our customers. We understand that a modern energy grid helps make Marylanders’ everyday lives better, from enabling solar interconnections and charging electric vehicles to technology that allows us to more efficiently and effectively manage our electric and natural gas systems. We also know that state’s energy companies are strong partners in the growth of Maryland’s economy.

A recent study by the independent Economic Alliance of Greater Baltimore found that BGE alone produced $5.4 billion in economic output, supported more than 11,000 jobs, and generated $532 million in state and local taxes.

We also are proud of our companies’ efforts to give back to the community. In 2018 alone BGE, Delmarva Power and Pepco combined contributed more than $6.2 million and our employees volunteered more than 31,600 hours supporting local Maryland nonprofits. We also bring added value by proactively seeking small, minority, women and service-disabled veteran-owned enterprises and have made significant investments in workforce development training to help today’s job seekers and tomorrow’s leaders.

Even with these achievements, we know there is more work to be done with our customers and in the communities where we operate. That is why we are actively supporting long overdue regulatory reform legislation that is currently working through the state legislature.

As an industry, we’ve watched the success in other states as they have adopted similar alternative methods to adapt to the changing nature of energy use and infrastructure planning. In fact, the National Association of Regulatory Utility Commissioners, whose mission it is to serve the public interest by improving the quality and effectiveness of public utility regulation and who represents state public service commissions in all 50 states, recently adopted a strong resolution supporting examination of alternative rate mechanisms.

In 39 other states, utility regulation has already benefited from improved transparency and accountability. For example, alternative rate plans enable customer input on utility investment plans before these plans are implemented and provide for better alignment of strategic priorities among utilities, customers and regulators to develop a cleaner, safer and more resilient energy grid.

To ensure that Marylanders have the benefit of improved and more effective utility regulation, it is critical that the legislature now establish clear policy direction to modernize utility rate regulation.

Under the pending legislation, Maryland’s Public Service Commission will continue to have the full authority to determine just and reasonable rates. Importantly, the legislation preserves all existing consumer protections.

Maryland has an opportunity for a more efficient and transparent way to invest in our energy grid to address climate change, secure our physical and cyber assets, and ensure continued reliable energy service for our customers.

As leaders of Maryland’s electric and gas companies, serving more than 2.5 million customers, we take our organizations role in delivering clean, safe, reliable and affordable energy for Maryland homes and businesses very seriously.

We urge the legislature to pass this bipartisan supported bill.

Calvin Butler and Dave Velazquez

The writers are the CEO of BGE and president and CEO of Pepco Holdings, respectively.

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