BGE seeks rate increase for $63 mln investment in Maryland gas system

BGE, a Baltimore-based gas company, is asking the Maryland Public Service Commission (PSC) to review natural gas delivery rates to ensure they reflect the cost of improvements being made to the gas system.

BGE, which serves 675,000 gas customers in Maryland, is currently investing $63.3 million in modernizing the natural gas system. It would like to see that investment reflected in gas delivery rates. In response, it has proposed raising the average residential gas and electric customer’s total bill by 3.5 percent or $5.77 per month. This would just be for gas delivery; BGE is not requesting an adjustment to electric rates.

Even with the increase, the average residential gas customers’ total bills would remain lower than a decade ago, BGE said. Plus, the systems will be safer and more reliable.

Gas bills have been lower over the past decade due to decreases in natural gas commodity prices, customers using less energy overall, and federal tax reductions that allowed BGE to flow $103 million in annual tax savings to customers.

“We know that while any proposed increase may be a challenge, we also know that our customers appreciate the investments we are making to serve them better, and the continuous effort we make to reduce costs and pass through efficiency savings,” Calvin Butler Jr., chief executive officer of BGE, said. “We’re delivering on our commitment to enhance the safety and reliability of the natural gas system, completing modernization projects on-time, on-budget and at a faster pace.”

BGE’s Strategic Infrastructure Development and Enhancement (STRIDE) gas infrastructure replacement program has replaced upgraded aging and leak-prone pipes and reduced greenhouse gas emissions.

Roughly 150 miles of gas mains and more than 32,000 service pipes connecting customer properties to gas mains have been replaced with modern gas equipment over the last four years.

Further, BGE’s investments in the natural gas system have contributed to the regional economy, creating about 600 jobs.

PSC is an independent state commission that ensures transparency, public input and fair rates for all customers. A decision on the current proposed rates is expected from the PSC in January 2019.