20060707 KDDC Recent MGA actions on Electric Dereg will hurt Marylanders

Recent General Assembly actions on Electric Deregulation will hurt Marylanders

July 7, 2006

In light of Maryland's Court of Appeal's decision today to halt the General Assembly's firing of the Public Service Commission, you may want to be sure to read an Op-Ed column in today’s Baltimore Sun as to how the Maryland General Assembly’s approach, in the long and short run, will hurt Marylanders in the future electric market.

It is written by Ray Gifford, president of the Progress and Freedom Foundation, is a former chairman of the Colorado Public Utilities Commission:

From the Baltimore Sun

Assembly's BGE stance will hurt Marylanders

By Ray Gifford

July 7, 2006

WASHINGTON -- Maryland will suffer for some time because of the General Assembly's poor, populist choices about electricity.

As expected, the legislature overrode Gov. Robert L. Ehrlich Jr.'s veto of a bill that limits Baltimore Gas and Electric's rate increases and eliminates all of the current members of the Public Service Commission. The bill is a travesty for Maryland consumers and good regulation.

By repealing the rate increases, the legislature effectively denies BGE the ability to pay the competitive price for electricity. While this is hailed as a populist victory over corporate greed, no one has made an effective case that the PSC's determination of the need for an increase was wrong or overestimated BGE's costs. Instead, the legislature chooses to defy simple regulatory math; an electric utility must be able to charge what electricity costs or it will provide too little or slowly go out of business.

Read the rest of the column here.