ANNAPOLIS – Beginning an impassioned plea to let residential customers save by buying electricity in bulk, Sen. Leo E. Green, D-Bowie, joked Friday about how God was going to charge Adam an arm and a leg for Eve, but was bargained down to a rib.
Green was seeking to amend a House bill to extend to residential electric customers the ability to join groups, or “aggregations,” to get discounts by purchasing energy in bulk. He said such aggregations have already reduced rates for the state itself, many local governments, chambers of commerce and other associations.
The last-minute amendment passed by a single vote. Some senators said automatically aggregating residential customers into a buying association and then letting them opt out later was coercive. They feared the measure would ultimately penalize customers seen as less desirable because of poverty and poor credit history.
Green and other supporters said it was consumer-friendly by providing a mechanism for individuals to cost-effectively form buying groups.
The original House bill, which returns regulation of electric metering to the state because of a lack of competition, passed the House unanimously a month ago. The changed bill is now likely headed for a conference to reconcile the differences.
Since the deregulation of Pepco and Connectiv, residential rates have increased substantially — an average of 15 percent for all Pepco customers, 11 percent for all Conectiv customers — according to the Maryland Public Service Commission, Green said.
He argued that deregulation had spawned Enron’s abusive energy trading in its single-minded drive for corporate profits. Now the Maryland General Assembly, by entertaining the original measure and without understanding what it was doing, was about to pass a bill framed by “little Enrons, that want the same monopoly as big Enron,” he said.
“I believe this is a sleeper issue” that will generate much more constituent backlash than fees, tolls, or real property tax increases,” Green said.
“This (amendment) offers us the opportunity to overcome a situation we didn’t realize would happen when we deregulated rates.”
He said that the city of Washington, D.C., estimated aggregation would save it $5.5 million over the next two years, and the Baltimore-Washington Corridor Chamber of Commerce’s 127 members expected to save $2.2 million over the next three years.
“We believe that if municipalities were allowed to aggregate with residential customers they could do a good job,” said Scott Hancock, executive director of the Maryland Municipal League.
Pepco strongly opposes opt-out aggregation, said Thomas Graham, Pepco region president, and feels that it will do a disservice to less-affluent customers, who may be left behind as wealthier communities form buying groups.
There was strong opposition within Prince George’s County, he said, from groups such as the Prince George’s Black Chamber of Commerce and the Maryland Black Mayors’ Association.
He noted that BGE rates, though still regulated, had increased by 17 to 19 percent because all rates were being driven up by increased fuel prices.
-30- CNS 4-1-2005