Maryland Public Service Commission approves three-year rate plan for BGE
The Maryland Public Service Commission approved the proposed three-year rate plan submitted by Baltimore Gas & Electric (BGE).
The rate plan calls for BGE to hold the line on rate increases for its gas and electric customers for the first two years – 2021 and 2023 – with a proposed increase in the third year.
In actuality, the rate structure for all three years is the same, but for the first two years, the increases are offset by federal tax credits that are due to be returned to customers. BGE proposed accelerating the return of those tax credits to counter any increase in customer bills for the next two years. After that, the credits run out, and the rates will increase in the third year.
“In order to mitigate the potentially severe economic impacts of approving a rate increase during an unprecedented pandemic, the Commission approved BGE’s plan to accelerate the use of certain tax credits to avoid any increase to customer bills for the first year of BGE’s multi-year rate plan,” Jason Stanek, chairman of the Public Service Commission, said. “However, the Commission elected not to exhaust those credits to prevent an increase in 2022 because doing so would have led to a larger rate increase in 2023 and beyond.”
BGE CEO Carim Khouzami said the approved plan will keep costs down for customers while allowing the company to make key investments.
“The PSC order is a good outcome for energy customers, accepting our proposal to hold bills flat in 2021, while still enabling significant investments in improving the safety and reliability of the natural gas and electric systems and the overall customer experience. These investments include hundreds of energy infrastructure projects and maintenance programs over the next several years that will have an estimated economic benefit of $15.3 billion for the local economy and will support more than 26,000 jobs. Holding bills flat next year and driving economic development and supporting critical infrastructure jobs will greatly assist with Maryland’s economic recovery efforts. At the same time, the region’s power grid and natural gas system will be stronger for it. We look forward to working with the PSC to ensure a successful implementation of Maryland’s first-ever multi-year plan,” Khouzami said.
