BGE seeks 6.6 percent residential rate increase for electricity -- Gazette.Net


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Baltimore Gas & Electric Co. is seeking to raise its electric rates by about 6.6 percent and its natural gas rates by about 7.9 percent for the typical household it serves.

In the request filed by the utility with the Maryland Public Service Commission on Friday, residential bills would go up about $7.22 for electricity, based on monthly median use of about 800 kilowatt hours, and about $4.62 for gas, based on use of about 52 therms.

The company is asking for the rate hike to help pay for refurbishing and upgrading its aging system to ensure that service is reliable and safe, executives said.

Most of that work involves replacing older infrastructure with new, more reliable equipment, said Mark D. Case, BGE's vice president for strategy and regulatory affairs.

The costs of wire and cable have risen about 125 percent and wooden utility poles about 36 percent in 10 years, while energy-saving programs and devices have helped households cut their use by 10 percent since 2005, Case said.

Because of those trends and the fact that so many poles were installed in the 1950s and 1960s and need to be replaced, requests for rate increases “will be a more frequent occurrence as we ramp up investment in the system — but we are also doing everything we can to be more efficient,” Case said.

BGE also will be replacing miles of cast iron gas mains with more durable pipe, according to spokesman Robert Gould.

Case said an Edison Electric Institute comparison of 50 utilities' distribution rates showed BGE's to be the eighth lowest.

The request filed Friday asks for an overall 4.4 percent increase in the rates charged for distributing electricity and a 6.6 percent increase in the rates charged for distributing natural gas.

Although customers must get their service from the utility that serves their geographic area, Case said less than 30 percent of a household electric bill pays for maintaining and operating the distribution system, and about 70 percent of the bill is for the energy supplied.

Because electric suppliers are competing, customers can shop around and often find savings that offset hikes in distribution charges, Case said.

Customers also can enroll in a number of programs that utilities offer that can help them save and manage costs.

BGE's requests will be subject to a series of hearings, yet to be scheduled, and if approved would not take effect until February.

In 2010, BGE sought a 5 percent overall increase and was granted 1 percent for electricity and 1.5 percent for natural gas.

Recently, Pepco, which serves Washington, D.C.'s Maryland suburbs, sought a rate hike that would have raised the typical monthly household bill by $5.50. The PSC approved a $2 increase.

mhyslop@gazette.net