- The Washington Times - Saturday, April 26, 2008

ANNAPOLIS (AP) — Gov. Martin O’Malley is confident Maryland has put in place “the strands” of an energy policy, but with much more work to be done to ward off a looming energy crunch, the governor said he would like to explore the possibility of publicly owned power generation.

Supply and demand problems have been neglected for too long, Mr. O’Malley said, and debate about energy policy is bound to carry on for years.

“Those debates will no doubt involve a lot of discussion about the degree to which we want our state — or even local governments or metropolitan councils — to play a more direct role in procuring energy and perhaps even in owning generation assets,” Mr. O’Malley said.

Mr. O’Malley, a Democrat, spoke after signing several bills that aim to put the state on track to conserve more energy, invest in energy efficiency and bolster its renewable energy portfolio standards.

The governor wants to explore the feasibility of creating an arrangement similar to the way the Baltimore Metropolitan Council oversees reservoirs that provide water for about 1.8 million people in the city and five surrounding counties.

“They have a customer base, and they’re able to provide that commodity, and I think there’s some merit in looking at whether or not such an entity might also be able to get into energy generation, and that’s one idea among many,” Mr. O’Malley said.

Local governments in other parts of the country already use what are known as peaking units, which can supply energy at times when electricity is especially costly — such as on hot summer days.

“If we had publicly owned peaking units that could turn on at that time, it would mitigate against some of those spikes,” Mr. O’Malley said.

That’s just one of several options Mr. O’Malley thinks the state must consider. Maryland is facing increasing demands for electricity, a limited supply, highly congested transmission capacity and aging infrastructure. If nothing is done, the state could face shortages resulting in rolling brownouts or blackouts by 2011, according to a Maryland Public Service Commission report released late last year.

“The big challenge moving ahead is not only the price of energy, not only the cost of energy, but the very availability of energy,” Mr. O’Malley said. “Rolling brownouts and rolling blackouts are a real possibility in the years ahead, and we need to do everything we can to try to get ahead of that crisis.”

The governor got the ball rolling on Thursday by signing several conservation measures. He also signed a bill needed to complete a $2 billion settlement with Constellation Energy Group Inc. The deal provides $187 million in one-time “rate rebates” for Baltimore Gas & Electric Co. customers and forgives $1.5 billion in customer liability for nuclear decommissioning costs.

Mr. O’Malley also thinks the settlement removes impediments to private investment and should make it easier for power companies to invest in transmission lines and power generation.

“There’s a lot more that has to be done, and hopefully we’ll have a federal government that’s doing it with us,” he said.


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