Constellation (BGE) Energy Rebate Settlement Explained

Many of us are still eagerly awaiting the promised economic stimulus package. I expect mine sometime around the middle of May. Click here to find out when your check should arrive. What you may not know is that Baltimore Gas and Electric (BGE) customers are also poised to receive a one time “rate rebate.”

The Settlement

Governor Martin O’Malley just signed a settlement between the State of Maryland and Constellation Energy resolving lawsuits by both parties over $386 million in energy credits approved during the 2006 special session. The agreement relieves Maryland ratepayers of the costs related to decommissioning the nuclear power plant facilities at Calvert Cliffs. And, it institutes a one time rebate for each BGE customer. The only hurdle left is approval by the Maryland General Assembly.

What This Means for BGE Customers

The impact of this settlement is two fold. First, under the terms of the agreement, each BGE customer will receive a one time rebate of approximately $170 by the end of the year. Second, Maryland ratepayers will save $1.5 billion in future payments.

What This Means for Constellation Energy

For starters, Constellation Energy assumes responsibility for the costs associated with decommissioning the Calver Cliffs power plant. This settlement also gives the Public Service Commission stronger oversight of Maryland utilities and requires BGE to elect two independent directors to the BGE Board of Directors. Lastly, future rate changes are limited to 5% and won’t take effect till October 2009.

What do you think? Is this a good solution? Do you think the government is addressing high energy cost effectively?
Image courtesy of lady_lbrty