- The Washington Times - Wednesday, March 29, 2006

ANNAPOLIS — The Senate yesterday advanced a plan that would force Baltimore Gas and Electric Co. (BGE) to lower electricity bills by returning $528 million it collected from ratepayers as part of the 1999 utility deregulation deal.

“We should claw back that $528 million and use it to offset the rising energy costs,” said Sen. E.J. Pipkin, Eastern Shore Republican and lead sponsor of the bill.

A power company executive called the measure “patently unconstitutional” and said the company would challenge it in court.

“We had a deal,” said Robert L. Gould, spokesman for Constellation Energy Group, BGE’s parent company.

In the waning days of the legislative session, lawmakers are pushing this and other legislation to Gov. Robert L. Ehrlich Jr.’s desk to counter a 72 percent increase in BGE bills while the Democrat-controlled General Assembly still has time to overturn a veto.

A bill that wasn’t scheduled for a Senate committee hearing until Tuesday was passed quickly by the committee yesterday afternoon and received preliminary approval from the full chamber by evening.

The bill, which would block Constellation Energy’s $11 billion merger with Florida Power & Light Co., won approval Friday in the House of Delegates.

Senate President Thomas V. Mike Miller Jr., Prince George’s County Democrat, said the bill would go to a final vote today.

The Senate also passed a bill that would dismantle the governor-appointed Public Service Commission, which regulates utilities, and replace it with a commission appointed mostly by legislative leaders.

Legislation that reaches Mr. Ehrlich, a Republican, by tomorrow will become law automatically if the governor does not sign it or veto it before the General Assembly adjourns April 10.

Lawmakers also have the opportunity to overturn a veto before adjourning.

Mr. Ehrlich said yesterday that he opposes the legislative remedies to the electricity-rate crisis, saying they could cause more harm than good.

The governor, legislative leaders and utility executives are scheduled to meet this morning to continue talks aimed at phasing in rate increases.

However, Mr. Gould said the fast-track legislation “clouds discussions [and] creates great uncertainty about what the end game will be.”

He said that killing the merger would prevent the company from lowering rates, would bankrupt the company and would result in power outages such as those in California in 2000.

Administration officials have said they are confident lawmakers will not go too far with punitive measures against the power company, but they also said the speed with which legislation advanced yesterday gives them pause.

“Clearly there is an emotional component here,” Mr. Ehrlich said.

Staving off “rate shocks” for BGE’s 1.2 million customers has become the hottest issue in this election year, in which Mr. Ehrlich is seeking re-election and every seat in the General Assembly is open.

The governor has indicated that a rate-reduction plan also should relieve increases of 39 percent for Potomac Electric Power Co. and 35 percent for Delmarva Power customers. The increases were announced March 7 and are set to take effect July 1.

The rate increases are partly the result of a 1999 deregulation plan approved by the Democrat-controlled General Assembly and signed by Gov. Parris N. Glendening, a Democrat.

The plan included rate caps that kept electric bills artificially low for the past six years and discouraged competition from entering Maryland’s partially deregulated utility market.

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