ANNAPOLIS – Even as state legislators and Maryland officials wrestle with the 72 percent rate increase Baltimore Gas and Electric Co. customers will face this summer, the utility has begun mailing out bills reflecting the higher electricity costs.
All 300,000 customers on the BGE budget billing plan – which spreads out costs over the year so that each monthly bill is about the same – have seen or will soon see increases, said Robert L. Gould, a BGE spokesman.
“We have to act according to what’s coming,” he said. “We still believe that budget billing is the way to go.”
Of the affected customers, about 61,000 who do not use gas or electric heat are faced with particularly jarring increases – up to 70 percent higher, Gould said, depending on account imbalances and other factors.
In a letter sent to Gov. Robert L. Ehrlich Friday, Baltimore Mayor Martin O’Malley insisted that the state’s utility regulator, the Public Service Commission, impose a moratorium on the rate increase until the legislature enacts a plan to mitigate its impact.
“While you have been quoted several times saying this will not happen, for thousands of ‘Budget Billing’ customers this shocking increase is happening – right now,” O’Malley wrote.
O’Malley, a Democrat, is vying to oppose the Republican Ehrlich in the upcoming gubernatorial election.
Ehrlich spokesman Henry P. Fawell dismissed the letter as a “political document” and said that “it will be treated as such.”
“Now is not the time for political rhetoric, now is the time for bipartisan solutions,” he said.
House Speaker Michael E. Busch, D-Anne Arundel, said that the rate increases for budget billing customers is not a main concern, since BGE already has a system to provide rebates with interest to customers who are overcharged.
“That’s like financing any other purchase,” he said.
Busch said his main concern was working with the governor and other legislators to come up with a plan to ease the burden of the rate increases, which are the result of the expiration of rate caps on July 1.
On Friday, the state Senate took the first step, passing the governor’s supplemental budget – which included just over $25 million to help low-income families fend off the coming rate increase – by a unanimous vote.
The increase is occurring for some ratepayers now because the budget billing program uses projected costs of future energy use to calculate charges. Since estimated July and August energy costs are currently being factored into budget billing customers’ rates, those bills already are reflecting the 72 percent increase.
About two-thirds of the increase customers are seeing comes from the end of the caps, Gould said. The remaining third comes from factors like increasing natural gas prices.
Customers who do not heat their homes with either gas or electricity are taking the biggest hit because of the schedule under which BGE calculates rates for customers on budget billing, said Christine Nizer, a public service commission spokeswoman.
The utility reviews energy usage for billing purposes periodically, but the main annual reviews for customers without electric or gas heat take place in February. Therefore, their bills reflect the increase earlier and the impact is higher. All other budget billing customers have their annual review in August.