Wednesday, March 11, 2009
Reregulating Energy Market is a Bad Idea
The Maryland General Assembly is considering legislation to re-regulate Maryland’s electricity market (SB 795/HB 1312 and SB 844/HB 1530).
The Maryland Chamber opposes such efforts because they would be costly to rate payers and would return the risk of building, owning and operating power plants to Maryland’s electricity customers. If passed, re-regulation bills could have a significant impact on commercial and industrial customers who purchase electricity in an a competitive marketplace.
Maryland’s Public Service Commission (PSC), along with its expert analysts, thoroughly studied the issue of re-regulation and have recommended against it. Commission reports on the issue found that re-regulation would be too costly to rate payers, too risky, and would result in legal problems. The December 2008 SB 400 Final Report stated that the PSC “cannot recommend that the legislature seek to return the existing generation fleet to full cost-of-service regulation.” Also, the Final Report said that the legislature should not restrict the PSC’s options for obtaining new power plants.
Today, the Public Service Commission has sufficient flexibility to address the needs of Maryland electricity consumers. The PSC can allow or require Maryland electric utilities to construct or acquire power plants. The PSC can also require Maryland electric utilities to acquire electricity through long-term contracts or portfolio management.
For more information, contact Allyson Black at .(JavaScript must be enabled to view this email address).
