PSC THUMBS NOSE AT LEGISLATURE & OKAYS BG&E MONTHLY ELECTRIC SURCHARGE

February 5, 2014

TO:  THE PEOPLE OF LEGISLATIVE DISTRICT 8

PSC THUMBS NOSE AT LEGISLATURE & OKAYS BG&E MONTHLY ELECTRIC SURCHARGE

 

In 2013, the Public Service Commission – PSC –approved two rate increases for BG&E, as well as a monthly surcharge on residential and commercial electric bills.  And the PSC completely sidestepped the General Assembly to do it.  Ironically, the PSC has rejected five separate BG&E requests to put a monthly surcharge on electric bills to pay upfront for infrastructure changes necessary to provide better and more reliable service.

The rate hikes will add $2.13 monthly to the average electric bill.  Starting this April, the surcharge will add 8 cents a month and increase annually until it reaches 36 cents in the fifth and final year.

How did BG&E electric customers come to get an upfront monthly surcharge on their bills without the approval of the General Assembly?  The Grid Resiliency Task Force, established and appointed by Governor O’Malley to study improving the delivery of electricity to residential and commercial consumers, recommended that the PSC approve a monthly surcharge to improve day to day electricity delivery.  In short, we have witnessed a task force, created and appointed by the Governor, enact law without Assembly input.  I think that’s pretty astounding, don’t you?        It should be noted that recommendations of a task force, commission, etc. are usually submitted to the legislature for input and approval or rejection.  The legislature generally has the final word.  That’s the way it should work.

AARP and the Office of the People’s Counsel, which advocates for residential utility customers, have registered their strong opposition to upfront surcharges.  They are appealing the PSC decision to give PEPCO a rate increase and a surcharge.  They are deciding whether to appeal the BG&E rate increases and surcharge.

Utility customers have always paid for infrastructure improvements and construction through added charges on their monthly bills.  However, we were not billed until the work was completed.  That is what’s different about this surcharge.  Two of the five PSC Commissioners opposed the electric surcharge, declaring that it unfairly shifted the risk from shareholders to customers before the improvements were made and before it could be determined if the work would actually improve service.  Indeed, this is a shamefully lopsided deal in which the utility is guaranteed upfront payment before the work is begun and the electricity users, who foot the bill, are guaranteed absolutely nothing!

Do not hesitate to contact me on this or any other issue of concern to you.  Please know that I encourage and welcome your input.