Power Rate Relief in Md. Squelched in Final Minutes

Throughout the night, support seemed wan among rank-and-file legislators who called the package a temporary election-year fix.

"It might sound good for the first year, but then there's more to the story," said Sen. George W. Della Jr. (D-Baltimore). "Rates steadily go up, and in the long term we continue to be captive to the grid."

Concerned about the delay in the Senate, a House committee approved its own slightly different version of the bill. That left the two chambers barely an hour to vote on the measures and reconcile their differences.

An hour before the legislature adjourned, Ehrlich told a live television audience that he would immediately call a special session if lawmakers failed to find a solution. He said he was satisfied with the agreement being considered. "A great result probably was never in our grasp here, given where we began," Ehrlich said.

Those concerns overpowered support from legislative leaders and the governor, and the agreement flamed out by a single vote on a procedural move in the Senate minutes before the midnight deadline.

From the moment electricity rate increases were announced by the Public Service Commission to the final confetti drop yesterday, the question of how to delay dramatic increases was foremost on legislators' minds. Electricity bills reflecting higher rates will arrive in mailboxes this summer, when many lawmakers will be campaigning for reelection.

"Some people are not going to be happy," said Senate President Thomas V. Mike Miller Jr. (D-Calvert). "It's hard to swallow any type of increase, but there's got to be an increase."

Throughout talks with Constellation, legislative leaders used as leverage the threat of bills to derail the companies' planned merger.

Constellation agreed to borrow money and provide $60 million annually for 10 years to pay for phasing in the rate increases. The company would have provided customers a credit to cover interest costs, but ratepayers would have paid as much as $3 extra a month toward the loan.

In turn, legislators were prepared to back off the bills that would have held up Constellation's $11 billion merger with Florida Power and Light Co.

But top lawmakers held out last night for changes to the Public Service Commission. The utility regulators, who approved the rates, have come under fire by Democrats for being too close to the industry they oversee. E-mails disclosed last month showed Chairman Kenneth D. Schisler's friendly relationship with a Pepco lobbyist.

Miller said that the General Assembly was prepared to drop a bill to immediately fire commissioners but that lawmakers still needed to ensure "honest ombudsmen" at the agency. A compromise under consideration would have allowed commissioners to keep their jobs during a review of the merger but require the governor to appoint new members during the 2007 legislative session. It also would have allowed the attorney general -- not the governor -- to appoint the People's Counsel, who serves as an advocate for consumers.