A STORY IN YESTERDAY'S BUSINESS SECTION INCORRECTLY CHARACTERIZED PLANS BY BALTIMORE GAS AND ELECTRIC CO. TO CUT ITS WORK FORCE IN THE NEXT YEAR. THE COMPANY IS CONSIDERING CUTTING BETWEEN 250 AND 350 JOBS IN ITS UTILITY OPERATIONS GROUP. A FINAL DECISION WILL BE MADE LATER THIS YEAR. THE STORY ALSO GAVE AN INCORRECT NUMBER FOR THE COMPANY'S TOTAL EMPLOYMENT. BGE EMPLOYS ABOUT 7,000 PEOPLE.
Facing pressure in a rapidly changing industry, Baltimore Gas and Electric Co. announced yesterday that it will cut as much as 9 percent of its 3,900-member work force in the next year.
BGE, which generates power for about 1.1 million customers in Maryland, will cut between 250 and 350 jobs and will consider additional layoffs over the next year, said Brenda Pettigrew, a company spokeswoman. "Competition creates pressures to become more productive and more streamlined," she said.
Stakes are high in the $250 billion national retail market for electricity. With the arrival of deregulation, electric companies are merging or being acquired at a rapid clip in attempts to remain competitive.
Michael Travieso, a spokesman for the Maryland People's Counsel, said he knows of nearly 50 mergers in the industry that are either approved or pending. A merger between BGE and Potomac Electric Power Co. fell through in 1997 because of regulatory delays and opposition from consumers, unions and environmentalists.
BGE cited several reasons for the plan to streamline their operations.
"Deregulation means that customers can have their choice, and that is what is driving this," Pettigrew said.
Last month, BGE and the Maryland Public Service Commission agreed to a deal that would cut residential electric rates by 6.5 percent beginning next July. Consumers in Maryland will also then be able to choose their power supplier from companies including BGE, Allegheny Energy Inc., Delmarva Power & Light Co., Enron Corp. and Duke Power Co.
In addition to increased competition, BGE also cited a six-year rate freeze after next year's rate reduction, as well as new technology and automated systems. The cost of these changes is unknown, Pettigrew said.
The company said it didn't know where it would cut jobs and that it might retrain and redeploy employees before making the final layoff decisions. Pettigrew said it was possible, but unlikely, that the company would lay off more than 350 workers. Employees were informed of the layoffs last week, she said.
Richard Crawshaw, a representative of the International Brotherhood of Electrical Workers, which has tried unsuccessfully to unionize BGE workers, said the decision has BGE employees worried. "There's immense concern, because they know what happened in December of 1997, when BGE cut over 100 jobs without regard to age or years of service," he said. Crawshaw, who has been trying to organize workers at BGE since 1996, said the company is likely to cut jobs at all levels.
Travieso's said he is concerned that if BGE lays off service workers, BGE will be less equipped to deal with ice storms like the one that hit Maryland last year. But Pettigrew says customer service will not be affected by the layoffs. "Reliability and customer service is paramount," she said.