ANNAPOLIS – As the drive to find a way to ease the coming electricity rate increases reaches its final days, the Maryland General Assembly rushed through two more measures Friday to ratchet up pressure on Baltimore Gas and Electric Co. and Gov. Robert L. Ehrlich.
In a lengthy and often contentious session, the House of Delegates gave final approval to bills that would oust all the members the state’s utility regulator, the Public Service Commission, and force BGE’s parent company, Constellation Energy Group, to return $528 million in “stranded costs” given to the company as insurance for its power plants as a part of 1999’s deregulation agreement.
Constellation spokesman Robert L. Gould said that the legislation was “extremely troublesome.”
“Without question it will have a negative impact on the business environment in Maryland and around the country,” he said.
Meanwhile, the governor resumed negotiations with Constellation representatives and legislators. Ehrlich has voiced disapproval of the Assembly’s efforts to force a deal to ameliorate an average 72 percent rate increase for BGE customers and has assured that compromise will be made by the April 10 end of the legislative session.
Ehrlich aides said that the negotiations were making “great progress” and that more meetings would be held next week.
The bill to change the PSC stipulates that four of the commission’s five new members would be appointed by the Speaker of the House and the Senate President, and only one would be appointed by the governor. Currently, the governor makes all five appointments.
Delegate George C. Edwards, R-Western Maryland, decried both bills as politically motivated efforts to punish the governor.
“The last four years in this General Assembly, we’ve taken away about every power from the governor,” he said. He then sarcastically commented that a bill should be introduced to abolish the governor altogether.
Delegate Peter V. R. Franchot, D-Montgomery, said that approval of the bills, particularly the ouster of the PSC, would be viewed as “a referendum on the rate hike.” He called the current commission “a toothless lapdog for the utility industry.”
Republican opponents of the legislation attempted to hold up both bills, but efforts to adopt a slew of amendments and stall through parliamentary procedure were shot down. Friday was the last day that the Assembly could pass legislation and still have time to override a governor’s veto before they leave Annapolis.
Ehrlich spokesman Henry P. Fawell said that the governor had “not reached a final decision” regarding either of the bills passed Friday or a bill passed Thursday giving the Legislature final approval over Constellation’s planned merger with Florida’s FPL Group.
Fawell did say, however, that the governor believes the bills are flawed. He said that there may be a legal issue with returning the $528 million to Constellation since that number was agreed upon in court six years ago. The PSC bill, he said, does nothing to bring down electricity rates.
“The governor urges that both the House and Senate shift their focus back to keeping electricity affordable,” he said.
Delegate Warren E. Miller, R-Howard, said that forcing Constellation to return to residential ratepayers the $528 million was unfair because only around 30 percent of ratepayers are residential.
He and other Republican opponents also said that the bill’s threat to stop Constellation’s merger if the company does not pay back the money could be a serious threat to the state’s largest electricity provider.
“If we delay a harmless merger,” Miller said, “you’re going to have ratepayers without electricity.”
Delegate Brian K. McHale, D-Baltimore, who chaired the subcommittee that approved the bill, assured his colleagues that electricity would be provided to ratepayers. Even in the event that BGE faced bankruptcy or some other catastrophe, he said, the Public Service Commission and the Federal Energy Regulatory Commission have the authority to ensure that another company reliably provides electricity.