Maryland PSC Staff File Proposed POR Discount Rates for BGE

Staff of the Maryland Public Service Commission have filed recommended levels for Baltimore Gas & Electric's Purchase of Receivables discount rates, to be considered at the Wednesday administrative meeting.

As a threshold matter, Staff does not recommend any alteration of the BGE POR discount rate methodology. As only reported by Matters, BGE had offered several alternative calculation mechanisms, including the elimination of late payment fee revenue as a POR discount offset, and the introduction of a credit and collection cost component.

Staff did state that it will address BGE's recommended modifications and similar policy proposals in the supplier coordination working group.

Additionally, in recommending that any negative discount rates be set at 0%, Staff said:

"Although costs are gradually (and in some cases, completely) being recovered through the POR rates; Staff intends to pursue additional features in the retail choice program which may require more programming expenses. In order to avoid abrupt increases in the future, these revenues should be retained by the utilities to offset incremental programming expenses."

Staff's ultimately recommended discount rates are identical to the applicable rates BGE proposed if no changes to the calculation methodology were adopted.

Specifically, Staff recommends applicable discount rates of:

Electric:

Residential: 0%

Type I: 0%

Type II: 0.2669%

Hourly Priced Customers: 0%

Gas:

Residential: 0%

General Service: 0%

The zero discount rates reflect negative discount rates which have been reset to 0%. For some classes, Staff's calculation resulted in a marginally different negative discount than BGE's negative discount rate (perhaps due to the passage of time since BGE's April filing), but the ultimate rate proposed to be applied to customers is identical due to the reset to 0%.

Staff's calculated discount rates (not reflecting the zeroing-out) are as follows:

Electric:

Residential: (0.4063%)

Type I: (1.0372%)

Type II: 0.2669%

Hourly Priced Customers: (0.2491%)

Gas:

Residential: (1.0388%)

General Service: (0.1139%)