Deferred Payments To Include Interest

Maryland households can spread out a 72 percent increase on their electric bills over two years but would have to make up the deferred payments with interest, under a rate relief plan imposed by state utility regulators yesterday.

Responding to a judge's order, the Public Service Commission said it had no choice but to force Baltimore Gas and Electric Co. to enroll its 1 million customers in a plan that increases rates gradually starting July 1.

But the decision rekindled criticism that the regulators side too often with the electric industry, rather than consumers. House Speaker Michael E. Busch (D-Anne Arundel) said commissioners had "thumbed their noses" at the court's decision by rejecting the judge's suggestion for a rate freeze.

Commissioner Harold D. Williams, the only member not appointed by Republican Gov. Robert L. Ehrlich Jr., chastised his colleagues for refusing to freeze rates until the commission holds a hearing on rate relief. "They failed to help the people of Maryland once again," Williams said.

The commission's decision came days after a Baltimore judge threw out another relief plan negotiated by BGE and Ehrlich and sent the matter back to the commission for review. Circuit Court Judge Albert J. Matricciani said the commission could either freeze rates temporarily or restore an unpopular phase-in plan that starts with a 21 percent increase and includes 5 percent interest payments.

Commission Chairman Kenneth D. Schisler concluded, in part based on an attorney general's letter, that the rate freeze would not withstand a legal challenge. A spokesman for the attorney general, however, said yesterday that the letter did not rule out a temporary cap.

Ehrlich laid the blame on Baltimore Mayor Martin O'Malley, the Democratic gubernatorial candidate who filed the lawsuit to dismiss the earlier rate relief plan.

"Today's developments demonstrate why naive, politically tinged lawsuits should never come before the interests of working families," Ehrlich said. "The city's lawsuit has put working families in a far worse position."

Montgomery County Executive Douglas M. Duncan, a Democratic candidate for governor, said the commission's action reinforced the need to convene a special legislative session. "It should be abundantly clear," said campaign manager Scott Arceneaux, that "it is up to lawmakers to fix this problem."

BGE spokesman Robert Gould said customers who do not want to participate in the phase-in plan can begin calling the company Monday at 888-234-0505.