Position: FAVORABLE
Maryland PIRG respectfully requests
a favorable report of HB 1314. This bill removes the mandate for the Maryland
Public Service Commission to create competition in competitive electricity
markets.
The PSC’s mandate to create
competition was written into statute when the Maryland General Assembly passed
electricity restructuring legislation in 1999. It was broadly believed that restructuring
of the electricity market would create competition, which would in turn drive
down prices, providing Marylanders with cheaper electricity.
Nine years later, it is clear that
restructuring has not delivered on these promises. Competition has failed to
appear with Constellation Energy still dominating the market for wholesale
electricity generation in Maryland,
the percentage of households that have switched suppliers is in the
single-digits, electricity rates have skyrocketed for residents across the
state, and the state is facing blackouts as early as 2011.
In response to these problems, the
Maryland General Assembly has taken action and passed a number of bills, most
notably SB 400 in 2007, to direct the state Public Service Commission to
investigate the situation and develop remedies. The PSC is currently reviewing
options to fix the problems with how electricity is bought and sold in Maryland and a final
report and recommendations to the General Assembly are due December 2008.
In the meantime, the Public
Service Commission is still making decisions about the future of Maryland’s electric
system and under current law is required to create competitive markets rather
than delivering the best value to rate-payers.
By removing the mandate to create
competition, this bill restores the public interest to the PSC’s
decision-making with regard to pricing, safety, and reliability and volatility.
The legislation also encourages the PSC to engage in federal proceedings to
protect the interests of the public.
Maryland PIRG respectfully
requests a favorable report on HB 1314.
For more information about this testimony, please contact
Johanna Neumann, State Director of Maryland
PIRG at (410) 467-9389.
