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Power Play: New Rates Take Effect Today

With higher electricity rates taking effect today for much of Maryland, Gov. Martin O'Malley and several public interest groups traded suggestions for how to cope with the 50 percent increase for Baltimore Gas & Electric customers.

O'Malley said yesterday his administration is preparing to release an energy conservation plan that could give "consumers some control over their energy destiny." O'Malley offered few details but pointed to the experience of California, which has held its per capita energy consumption in check during the past 35 years. Other states, including Maryland, have seen consumption rise dramatically.

Meanwhile, representatives from the Maryland Public Interest Research Group, Progressive Maryland and the AFL-CIO called a news conference to detail the impact of higher bills on low-income families, propose new policies for the future and question the role that campaign contributions played in the crafting of a 1999 electricity deregulation bill that has been larely blamed for the hefty increases in recent years.

"Lawmakers need to prove they are not beholden to deep-pocket special interests," Sean Dobson, acting director of Progressive Maryland said in a statement. "They need to enact voluntary, public funding of campaigns so they can run for office without taking money from BGE, Pepco, and other big-money contributors."

By Phyllis Jordan  |  June 1, 2007; 6:15 AM ET
Categories:  John Wagner  
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When you artificially hold down rates for years, then let them go, what does anyone expect ?

That this is some kind of argument for financing elections with taxpayer money is yet another indication of the bizarre dislocation of the liberal mindset.

Posted by: gitarre | June 1, 2007 8:24 AM | Report abuse

According to O'Malley's campaign propaganda, the HIS Public Service Commission is going to wave a magic wand and make this go away. Well, my "working family" is waiting...

O'Malley wants to propose an energy conservation plan after that of California. What will that be? The rolling blackouts of a few years ago?

What a complete moron. He won't be happy until MD is upside down in debt-like California. Let Maryland be Maryland. I'm sick of hearing "like that of California" attached to every far left lame proposal that he floats.

Posted by: BG from PG | June 1, 2007 8:29 AM | Report abuse

In just a few months in office, O'Malley has made horrible errors and so he now presides over (1) one of the largest and worst budget deficits in Maryland history -- 1.5 BILLION dollar deficits projected for the forseeable future and (2) an energy crisis of historic proportions, his proposal yesterday of an emergency conservation plan like the one California using during the rolling blackouts a few years ago is unprecedented in Maryland. If he continues with these errors, he will be a 1-term Governor. See ya.

Posted by: Anonymous | June 1, 2007 8:41 AM | Report abuse

gitarre, it's even dumber than that. Once it was decided to deregulate, the commission CUT the rates and then froze it for a few years. It's not O'Malley's fault - this happened well before he was in office.

All I want to know is the new BGE rate. Oddly enough, it's not listed anywhere I can discern on their website. They give the old rate but not this new one. How can one compare?

Posted by: Anonymous | June 1, 2007 8:52 AM | Report abuse

Yes, yes, Sean Dobson - public financing of campaigns, what a PERFECT solution to high energy costs due to a 10 year old deregulation plan. And then maybe we can do mandatory recycling which will reduce trash and eventually lower pollution from additional manufacturing which can allow people in one of the smaller states in the country to use 5 percent less air conditioning (assuming we haven't been overtaken by global warming at that point) and THAT can save on people's energy bills. Or, or maybe if we pull the troops out of Iraq and reduce our dependence on foreign oil and lower energy costs.. Wait, no, using less foreign oil means LESS supply, so prices would go up further, nevermind, let's leave the troops in Iraq and just pay for politicians campaigns with tax dollars. That'll lower costs.

Posted by: idea man | June 1, 2007 9:26 AM | Report abuse

all of these are fine ideas. Or we could just turn up our air conditioner a bit, leave it off when we're not at home, try unplugging items when not in use, not leave the refrigerator open while we make a sandwich, take a shower that is a little shorter and a little more moderate temperature, keep windows closed, switch to compact flourescent light bulbs. You know, the kind of things that actually impact your energy bill and don't cause the government to have to build a massive new regulatory program that costs us in tax dollars even more than it may potentially shave off our monthly BGE bill.

Posted by: Anonymous | June 1, 2007 9:36 AM | Report abuse

"It's not O'Malley's fault - this happened well before he was in office." --- Uh, what about O'Malley's CAMPAIGN PROMISE to protect consumers from a massive rate hike, oh, let's not forget that minor little detail. It's all O'Malley's fault for not living up to his campaign promise to stop the rate hike. He has failed miserably.

Posted by: Anonymous | June 1, 2007 9:57 AM | Report abuse

I wonder what other problems could be solved with public financing of campaigns using the logic that taking money from a representative of that industry causes the problem related to it. IE - taking campaign contributions from a BGE official causes high energy bills.

Let's see....

It would end the war in Iraq if we didn't allow soldiers or veterans to contribute.

We could make it so grass didn't grow so high if the big fertilizer producers were cut out of the picture.

All the problems with the schools would improve if we got teachers and principals out of the political mess of giving to politicians.

Bunions and Athlete's Foot would likely disappear if the footwear giants didn't control our legislature.

Leaking ballpoint pens would be a thing of the past were it not for contributions from BIC and Papermate corporate honchos. And they would never run out of ink either.

Oh, and if we just got the huge roadbuilding conglomerates out of the area of bribing politicians with expensive big business goodies, we wouldn't have any more traffic problems.

This public financing thing sounds great.

Posted by: Anonymous | June 1, 2007 10:06 AM | Report abuse

You mean O'Malley's not stick by his campaign promises? I am shocked, SHOCKED to hear of such a thing.

Posted by: Rufus | June 1, 2007 10:07 AM | Report abuse

Let's call it what it is. It's not just that O'Malley cannot live up to campaign promises, it's more obvious that he's a blatant lying political oppurtunist who told everyone that Ehrlich was to blame for the rate increase and that since Ehrlich couldn't stop it, he and the PSC must be living in the back pocket of BGE. Now who's scratching their heads about how to deal with this?

Posted by: BG from PG | June 1, 2007 11:10 AM | Report abuse

It's very amusing, O'Malley claims it's Ehrlich's fault that O'Malley can't stop the BG&E rate hike. O'Malley loves to have it both ways, if he fixes it, he takes the credit, and if he screws up, he just says it's all Ehrlich's fault. O'Malley's excuse-making is growing tiresome, Ehrlich will win their rematch in 2010, take it to the bank.

Posted by: Anonymous | June 1, 2007 11:31 AM | Report abuse

Gasoline prices are $3.gallon. Electric rates have increased 50%. Montgomery County Executive Leggett and Montgomery County legislators are in favor or gasoline, income and sales tax increases in addition. Washington Post editors are in favor of tax increases to fill the "deficit," they didn't know about the day before the November elections. Contempt for the public is the rope that ties these folks together.

Posted by: Robin Ficker | June 1, 2007 11:56 AM | Report abuse

Gasoline prices are $3.25 per gallon. Electric rates have increased 50%. Montgomery County Executive Leggett and Montgomery County state legislators are calling for increases in the gasoline, income and sales taxes. Washington Post editors are calling the tax increases to fill the "deficit," they didn't know about the day before the November elections. Contempt for the public is the rope that ties these folks together.

Posted by: Robin Ficker | June 1, 2007 11:59 AM | Report abuse

Deregulation is a failed business model for the consumer, and a huge windfall for businesses. Economics 101 are simple, manage supply to maximize profit. Maryland has a long history of political corruption, but I believe these rate increases are the result of incompetance. Maryland has nuclear power, and Marylanders should benefit from it's presence in our state. Without appearing to be a socialist, some public services such as water and sewage, electricity, and roads should be regulated.

Posted by: Anonymous | June 4, 2007 10:11 AM | Report abuse

Actually, O'Malley is protecting consumers from this rate hike as much as any new Governor possibly could. Under Erlich, the rate hike was set for 75%. In a short itme in office, O'Malley's influence has dropped the hike to 50%. So, by voting for O'Malley instead of Erlich, you've already saved hundreds. Also, the budget deficit was handed to O'Malley by the previous administration. The ball is now in O'Malley's court - lets see if he can be as tough as he needs to be to save the state. Number one budget priority should be - stop the runaway ICC spending! How can any sane person agree to commit $3 billion to one road project when the state is facing debt already? O'Malley, MD is counting on you.

Posted by: Donny | June 12, 2007 12:00 PM | Report abuse

Donny - Do the math properly. There was a 15% hike in January, followed by a 50% hike in June (on top of the 15% in January). This is a grand total of 72.5% rate hike = ((Pre Jan Rate * 1.15) * 1.50) = Pre Jan Rate * 1.725.

The issue that has never gotten much attention (that I have seen) is much more basic. If rates were artificially held below market value for years, then it stands to reason that BGE should have been losing money for at least some of that time. I think (although I have had trouble locating the information directly) that BGE has in fact remained profitable prior to the rate hikes. If that is indeed the case then we are contributing our 72.5% increases to their bottom line. This is a situation similar to what has gone on recently with te big oil companies who are reporting record profits in the these times of record gas prices.
I have no problem paying a market rate for the energy I use; however, when the rate I pay is higher than ever before and the supplier is gathering record profits; that is a combination I find wholly unpalatable.

Posted by: John | June 19, 2007 10:58 AM | Report abuse

Good point about BGE not losing out on profits, but those of you who keep flushing up those tired numbers from the Erlich administration keep leaving out the critical facts involved with how we got here - and are the key to how O'Malley and future Governors can improve the mess instead of perpectuating it. Erlich's masterpiece was the abillity to spend into oblivion by setting the FY2007 budget to use all the money the state had in the bank. The first budget O'Malley will be responsible for will be the FY2008 budget, which thanks to the last administration will start out with a deficit. Similarly, Erlich's folks cut a deal before the 2006 election, that postponed the increase until AFTER the thats how we came to the 72% everyone is bandying about. Like everything else, Erlich was pushing for re-election...if he lost, which he did, the next office-holder would have to clean up the mess. That is how we got here. Ready to fix the problem? If not, I'm sure there is more O'Malley bashing to come. And thats OK. Its O'Malley's turn in the barrel and he should be able to take criticism and still get the job done. However, many who hate O'Malley just because he beat Erlich should ask themselves - "Am I helping the state solve its fiscal problems?"

Posted by: Donny | June 22, 2007 9:57 AM | Report abuse

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