ANNAPOLIS – Marylanders could see lower energy rates in the near future with the passage of an energy bill that would require the state to increase the availability of solar power. Or so says the bill’s sponsor. Skeptics, however, worry that the cost of the program could cause average monthly bills to go up, not down.
“All of our ratepayers stand to benefit from this bill,” said Sen. Robert J. Garagiola, D-Montgomery, the bill’s sponsor. In a best case scenario, he said, “their rates will go down 2 to 5 percent.”
The bill, which passed 31-16 and now moves to the House of Delegates, stipulates that, beginning in 2008, .005 percent of the state’s energy resources must come from solar power. The requirement increases every year so that by 2015, .25 percent of the state’s energy would be solar and by 2022 solar power would make up 2 percent. The Public Service Commission would designate a person to oversee the implementation and to make policy recommendations to the commission.
Opponents of the bill, mainly utility companies, had voiced concerns at the bill hearing about the cost to their operations.
“While it has the potential for being a very clean source for producing electricity, solar energy has been historically, and remains today, very expensive,” Baltimore Gas and Electric Company stated in written testimony. The utility warned that the costs, in addition to the compliance fees outlined in the legislation, could be transferred to the consumer.
However, Garagiola said that in a worst case scenario, instead of rates decreasing or staying the same, customers could pay 2 cents extra on their monthly utility bills next year or 4 cents more on their bills in 2009.
But even so small a potential increase, after BGE imposed a 72 percent rate hike last summer, still had some senators concerned about the impact on their constituents.
“Sometimes what looks good and feels good ends up not feeling so good,” said Sen. George W. Della Jr., D-Baltimore, during debate last week. “But the bottom line on this bill is that it affects our ratepayers.”
In order to achieve solar energy goals for the state, the legislation encourages individuals and businesses to install solar panels on their roofs or elsewhere on their property, which will produce energy that utility companies can then buy back from them. Garagiola said that Staples, an office supply company that testified in favor of the bill, has already pledged to install solar panels on some of its larger retail locations.
“As more companies do this, the utility companies buy them and then everybody’s rates go down,” Garagiola said Friday. “So at the very least, more solar energy means mitigated rate increases” when Marylanders are facing another potential 50 percent rate hike by BG and E.
Maryland established the Renewable Energy Portfolio Standard in 2004 to cultivate the economic and environmental benefits of renewable energy, establish a market for electricity from those resources, and lower the cost for electricity. The state also mandated that, by 2019, at least 7.5 percent of its energy would come from renewable energy sources, including solar.
While some lawmakers advocated waiting for the Maryland Energy Administration to release its first report on the commission before making any changes to the program, others said the sooner the better to help soften any potential BGE rate increases next year. “We’re at a stage where we have to start looking ahead and decide what we want for our future,” Sen. Thomas M Middleton, D-Charles, chair of the committee that heard the bill, said last week. “If this does not work, we will stop it dead in its tracks because our intention is not to drive the cost to the consumer up.”